Global energy and commodity price reporting agency Argus has launched two calculated prices that value the cost of compliance generated under the FuelEU Maritime regulation.
The calculated prices represent the cost of abating one tonne of CO2 equivalent by burning used cooking oil methyl ester (Ucome) instead of marine gasoil or very-low sulphur fuel oil. They bring transparency to a compliance market which has emerged since the introduction of the FuelEU Maritime regulation in January 2025. The measure requires ships operating in EU waters to cut greenhouse gas emissions progressively — starting with a 2% reduction in 2025 and increasing to 80pc in 2050.
Shipowners and charterers who generate GHG savings above the 2% requirement can choose to sell the surplus to other shipowners using FuelEU’s pooling mechanism. This allows a shipowner to aggregate compliance over its entire fleet to create a positive balance at the end of the reporting year. It can also involve selling excess compliance to companies which have not achieved the targeted reductions.
As well as providing a value for the cost of compliance, the new prices can be used by shipowners to decide whether to sell compliance, save it for future years, or pay the penalty for failing to meet the target. Charterers can use the prices to value the compliance generated during short- or long-term charter agreements to sell or buy back compliance at the end of those agreements.
The regulation requires shipowners to pay penalties if they fail either to meet the reduction target or to purchase surplus compliance from over-performers.
Argus’ new prices show that the cost of purchasing additional compliance is currently half the value of the penalties.
“We have developed these new compliance cost prices based on requests from shipping industry participants,” Argus Media chairman and chief executive Adrian Binks said. “There is a real need to have an accurate marker for the cost of compliance so that companies can allocate resources to cut the most emissions at the lowest cost. Companies have told us they plan to use these new prices in contracts and in long-term planning and investment decisions.”
The new FuelEU Ucome-MGO abatement and FuelEU Ucome-VLSFO abatement prices are published daily in €/t CO2e and $/t CO2e in the Argus Biofuels and Argus Marine Fuels reports.
Source: Argus
