Last month, the European Commission published two new proposals for EU regulations to encourage the use of sustainable fuels in aviation and shipping – namely the ReFuelEU Aviation and FuelEU Maritime initiatives, respectively. Both proposals are subject to public feedback until 5 October.

FuelEU Maritime

Maritime transport is crucial to the EU’s economy. It contributes to three quarters of external trade and almost one third of internal trade volumes, with shipping playing a critical role in connecting islands and peripheral regions with the rest of the single market. Moreover, it safeguards the mobility of European citizens, with 400 million passengers using European ports annually.

However, the EU estimates that maritime carbon emissions account for almost 4% of total EU emissions (and for 11% of EU transport emissions). Currently the fuel mix in maritime sector relies entirely on fossil fuels. Last year, the EU adopted the EU Climate Law to cut carbon emissions by at least 55% by 2030 and to achieve net-zero by 2050. To achieve this goal, a 90% reduction in transport emissions (including maritime transport and aviation) is needed by 2050. The FuelEU Maritime initiative aims to help bring the shipping sector in line with this ambition.

To this end, the EU Commission has prepared a proposal for a regulation to enhance the use of sustainable alternative fuels in shipping. The FuelEU Maritime is part of a larger suite of measures aiming to address maritime transport emissions, while also maintaining a level playing field. It is consistent with the measures introduced in the ‘Fit for 55’ package and builds on existing policies. The proposal addresses (a) market barriers hampering the use of sustainable fuels; and (b) uncertainty about which options for a wider roll-out of sustainable fuels are market-ready.

In particular, the proposed regulation imposes (a) a limit on greenhouse gas emissions of ships arriving at, staying at or departing from EU ports; and (b) an obligation on EU ports to become carbon neutral. If adopted, the regulation would require ships to reduce their annual average greenhouse gas emissions as follows:

  • 2% from January 2025
  • 6% from January 2030
  • 13% from January 2035
  • 26% from January 2040
  • 59% from January 2045
  • 75% from January 2050

The proposal applies all ships above 5,000 tonnes, with the exception of warships, fish-catching or fish-processing ships, government ships, and primitive wooden and non-mechanical ships.

The initiative is available here. The proposal is open for feedback until 5 October 2021.

ReFuelEU Aviation

Contributing to the EU’s GDP by more than 2%, the aviation sector is also crucial to the EU’s economy and the mobility of its citizens. The sector heavily relies on fossil fuels at present. While sustainable aviation fuels such as biofuels and electro-fuels would significantly reduce aviation emissions, they currently represent only 0.05% of total jet fuel consumption.

Last year, the European Commission adopted the Sustainable and Smart Mobility Strategy, which aims to boost the supply and demand for sustainable aviation fuels. Sustainable aviation fuels would significantly contribute to achieving the EU’s carbon neutrality goals. In particular, synthetic aviation fuels could lead to emissions savings of 85%. To this end, if adopted, the regulation would require the aviation sector to gradually increase the share of sustainable aviation fuels between 2025 and 2050. Below is a timeline of minimum sustainable aviation fuels share as envisaged by the proposed regulation:

  • At least 2% from January 2025
  • At least 5% (of which at least 0.7% synthetic aviation fuels) from January 2030
  • At least 20% (of which at least 5% synthetic aviation fuels) from January 2035
  • At least 32% (of which at least 8% synthetic aviation fuels) from January 2040
  • At least 38% (of which at least 11% synthetic aviation fuels) from January 2045
  • At least 63% (of which at least 28% synthetic aviation fuels) from January 2050

The proposed regulation would apply to aircraft operators operating at least 729 commercial air transport flights annually departing from the EU.

The initiative is available here. The proposal is open for feedback until 5 October 2021.

Please do not hesitate to contact any member of the Reed Smith EHS team if you would like more detailed information on this topic.