Page 180 - ΝΑΥΤΙΚΑ ΧΡΟΝΙΚΑ - ΜΑΙΟΣ 2024

REGULATIONS

THE CARBON COUNTDOWN:

TRADING UNDER THE EU’S

EMISSION AMBITION

Contribution by Marlow Navigation
Crew & Technical Management,
Seafarer Training.

Implementing new technologies and changing
operational practices (like optimising speed,
loading strategies, and voyage routes) to com-
ply, may disrupt established procedures. Com-
panies who efficiently manage their emissions
may benefit from lower operational costs and
enhanced market reputation. While the afore-
mentioned are significant advantages, it is also
important to consider the competitive strain
on smaller and more traditional establishments
which may be less prepared to adapt. Given this
predicament, opting for third-party ship man-
agement may prove an appealing strategy.
Third-party managers are oftentimes more agile,
quickly adapting to regulatory changes, imple-
As the clock ticks towards a sustainable future, menting best practices through their special-
the European Union’s Emissions Trading Sys- ised knowledge and experience. Their dedicated
tem (EU ETS) has expanded its reach, adding a teams can monitor regulatory developments and
new layer of complexity to an already intricate ensure that all managed vessels are compliant.
regulatory maritime landscape. It is crucial for shipping companies to ensure
Inevitably, shipping companies are potentially that any offsets are credible and result in real,
facing significant emissions-related expendi- measurable, and verifiable emission reductions.
tures. Surplus allowance costs could impact Many reputable managers, such as Marlow Nav-
shipowners and consequently, shipping rates. igation, have long invested in the right frame-
For example, SeatradeMaritime reports that the works to ensure smooth operations as well as
EU ETS will, on average, increase operational the integrity of reported data, reducing the own-
costs per container vessel by an estimated ers' administrative burden.
€550,000 in 2024 and a further €1.4m in 2026. Non-compliance with EU ETS requirements can
What is more, allowance prices fluctuate based lead to substantial fines and penalties, which
on market conditions and regulatory changes, may prove a significant financial blow. Ensur-
imposing a new dimension of financial risk. ing compliance is thus crucial and in-tandem,
Despite the limitations and increased admin- owners could further benefit from a ship-man-
istration imposed by the EU ETS, challenges ager partnership, yielding further cost savings.
can also be seen as opportunities for growth Managing multiple vessels for various owners
and innovation in the sector. Financial incen- allows third-party managers to achieve more
tives may even become available to companies competitive economies of scale in purchasing
that endorse green technologies, like subsidies allowances, technology upgrades and even fuel.
or tax breaks, which can mitigate some of the While traditional shipping companies face sig-
financial burdens of transitioning to lower car- nificant challenges due to the EU ETS, there
bon operation brackets. These include invest- are strategies to help mitigate these difficul-
ing in modern vessels equipped with advanced ties. By outsourcing ship management, owners
technologies such as alternative fuels or hybrid can focus on what matters - their core business
propulsion systems, optimised hull designs, and strategy, leaving operational complexities and
energy-saving devices. regulatory compliance to experts.

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