As the FuelEU Maritime regulation takes effect, companies must choose between paying the penalty, switching to biofuels, or pooling surplus from over-compliant ships. Each option has significant financial implications. This week, we present a case study comparing real-world costs for a non-compliant vessel, helping companies identify the most cost-effective strategy.
Evaluating FuelEU Maritime Compliance Costs
Scenario Overview
A sample containership consumes 10,000 tonnes of HFO within the FuelEU scope. Given its fossil fuel usage, the ship incurs a compliance deficit of 975 t CO₂e in 2025. The operator faces three choices to comply:
Pay the FuelEU Penalty (€2,400 per tonne of VLSFOe or €640 per tonne of CO₂e).
Switch to Bio30 (30% biofuel blend) at an additional €209 per tonne compared to VLSFO (ARA price difference, HBE incentivized as per Feb 7)
Purchase surplus from another ship at a price of €250 per tonne of CO₂e surplus.
Each method has different cost implications and strategic benefits, as shown in the breakdown below.
Option 1: Paying the FuelEU Penalty
Under FuelEU Maritime, ships failing to comply must pay a fixed penalty of €2,400 per tonne of VLSFOe (equal to €640 per tonne CO₂e)*.
While simple, this is the most expensive option. Additionally, if the vessel remains non-compliant for consecutive years, penalties are further penalized exponentially, creating a growing financial burden.
Option 2: Switching to Bio30
Switching to a 30% biofuel blend (Bio30)** reduces the vessel’s emissions to meet compliance with FuelEU Maritime.
Biofuels provide a regulatory-compliant pathway by reducing emissions at the source. However, they come at a premium price, may have supply constraints depending on market availability, and technical challenges as described below:
Delayed Proof of Sustainability (PoS): The exact emission reductions achieved with biofuels are often uncertain at the time of bunkering. The PoS, which defines the emission factor of the fuel, is typically delivered after bunkering, sometimes significantly later. This delay can complicate compliance reporting and strategy planning.
Cashew Nutshell Liquid (CNSL) Biofuels: Recent reports have highlighted significant engine problems associated with biofuels derived from cashew nutshell liquid. Ships operating in Singapore and Rotterdam experienced issues such as clogged filters, injector failures, fuel sludging, and turbocharger corrosion after using CNSL-based biofuels.
Option 3: Pooling
Pooling allows companies to purchase surplus from vessels with over-compliance, achieving compliance on the deficit ships at a significantly lower cost***.
Pooling emerges as the most cost-effective option, with compliance costs significantly lower than both penalties and biofuel. Moreover, pooling offers additional flexibility:
Companies can purchase only what they need or buy extra surplus for future banking.
Even tramp shipping companies, operating with uncertainty, can secure surplus now and bank it for future use.
Early purchases guarantee lower prices before market demand increases.
Comparing the FuelEU Compliance Costs: The Best Choice
Pooling offers the lowest compliance cost while maintaining flexibility, making it the best option for most shipping companies. Note that EU ETS savings are not considered, check out this newsletter if you want to find out how EU ETS changes the business case.
Why Trade Early?
Pooling is not just the cheapest option—it also provides strategic advantages:
Locks in lower prices before demand increases later in the year.
Prevents FuelEU penalty multipliers, avoiding long-term cost escalation.
Allows banking of surplus, providing compliance security for future years.
Tramp shipping companies can secure compliance early despite uncertain schedules.
Still not onboarded yet? Start your onboarding process by clicking on the button below and filling out the form at the bottom of the linked page or reserve surplus now by emailing info@bettersea.tech and get onboarded subsequently.
Conclusion: FuelEU Pooling is the Smartest Compliance Strategy
Penalty payments are the most expensive option, offering no long-term benefit.
Biofuels reduce emissions but are supply-dependent.
Pooling surplus provides the lowest-cost, most flexible compliance solution.
With surplus trading, FuelEU compliance is no longer just about meeting regulations—it’s about making the smartest financial decision. Secure your FuelEU surplus today—email info@bettersea.tech!
BetterSea’s FuelEU Maritime Compliance Platform with integrated marketplace provides you with a fast, streamlined, end-to-end process covering all potential compliance options, including external pooling and surplus trading. Book a demo below!
Stay tuned for more insights on navigating the FuelEU compliance mechanisms in our upcoming newsletters. If you have any questions or need further guidance on pooling, feel free to reach out!
Best regards,
The BetterSea Team
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*Simplified unit conversion **The analysis assumes an emission reduction for biofuel of 65% compared to 94 g/MJ (as per RED II) and a LCV of 37200 ***Surplus value estimated to be 250 €/t CO2e (Disclaimer: This is an assumption)