While the details of the regulation are yet to be settled, MSC said compliance will lead to higher operating costs, and that those costs will need to be passed on to customers. The costs involved will depend on the price of EU Allowances (EUAs), essentially licenses for industry to emit CO2 above a set threshold.
MSC said it will calculate costs on a monthly basis when the regulation enters into force, referencing a public index of EUA prices to generate costs on a per-service basis with individual structures for inbound and outbound cargoes.
Estimating costs based on an EUA price of €90 per tonne and assuming voyages are 100% covered by the scheme, compliance costs range from a high of €500 per feu for a reefer North/South Europe – NEU to Greece/Turkey to a low of €32 per feu for a dry box from USA/Canada to the EU.
MSC said the industry faces either a phased introduction of an ETS over four years from 2023, or a full application of the system from January 2023.
“The final start date for coverage has yet to be determined, as the legislative process is still ongoing,” said the advisory.
All emissions for intra-EU trade are set to be covered by ETS, and 50% of voyages with only an origin or destination in the EU.
"We are closely monitoring as proposed regulations proceed through appropriate legislative mechanisms within the EU regulatory framework and we will provide updates accordingly," said MSC.
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