Connect with us

FuelEU

BIMCO adopts FuelEU Maritime clause for charter parties

BIMCO FuelEU Maritime Clause for Time Charter Parties 2024 is developed to help stakeholders align their contractual frameworks ahead of the FuelEU Maritime regulation.

Admin

Published

7 months ago

on

BIMCO RESIZED

International shipping association BIMCO on Monday (25 November) said it has adopted a new contractual clause for time charter parties relating to the FuelEU Maritime regulation, which will come into force on 1 January. 

The BIMCO FuelEU Maritime Clause for Time Charter Parties 2024, which is designed for incorporation into time charter parties, is developed to help stakeholders align their contractual frameworks.

The focus of the BIMCO’s Documentary Committee has been on developing a standard clause that is workable for most scenarios and commercial relationships. For longer period charter parties, the charterers will have the flexibility to decide on their compliance strategy whether that be utilising pooling, banking or borrowing. 

“This clause has been eagerly awaited by the industry. January is almost here, and the FuelEU Maritime regulation is complex. Because of this, we have carried out several industry consultations during the drafting process to make sure that we arrived at a clause that works in practice,” said Stinne Taiger Ivø, Deputy Secretary General and Director of Contracts at BIMCO.

“The FuelEU Maritime regulation will significantly impact the shipping industry, even more so than the EU Emissions Trading System. The clause we have adopted today is the result of a collaborative process between owners, charterers, P&I and legal experts and other stakeholders,” says Nicholas Fell, Chair of BIMCO’s Documentary Committee.

The company responsible for compliance with FuelEU Maritime under the new BIMCO clause is the shipowner. In reality, however, it may be a third-party shipmanager who has agreed to take over all the duties and responsibilities imposed by the International Management Code for the Safe Operation of Ships and for Pollution Prevention (ISM). BIMCO is therefore working on developing a clause for BIMCO’s ship management agreement, SHIPMAN.

In December last year, the Documentary Committee adopted a new Emission Trading Scheme Allowances Clause for BIMCO’s ship management agreement, SHIPMAN, and three ETS clauses for Voyage Charter Parties. Moreover, in June this year, the Documentary Committee adopted three ETS clauses for Contracts of Affreightment.

Other published decarbonisation clauses in BIMCO’s carbon clauses portfolio include the Emission Trading Scheme Allowances Clause for Time Charter Parties, CII Clause for Voyage Charter Parties, CII Operations Clause for Time Charter Parties and the EEXI Transition Clause for Time Charter Parties.

Antonia Panayides, partner in Reed Smith’s Transportation Industry Group who serves on the BIMCO drafting committee for FuelEU Maritime, said: “The new FuelEU Maritime Clause for Time Charter Parties is important for the industry, as the Regulation expressly provides that parties should look to their contractual agreements to implement the ‘polluter pays’ principle.

“It is not only time charter contracts that need to take FuelEU Maritime into account, many shipping contracts will need to consider the impact of FuelEU Maritime such as contracts of affreightment, ship management agreements, bunker supply agreements and sale and purchase contracts.

“The clause for time charter parties introduces an approach whereby charterers pay a ‘surcharge’ to owners if the vessel incurs a compliance deficit during the charter period. The parties are to agree when such payment should be made. The surcharge represents the owners’ exposure to a FuelEU penalty, proportionate to the charter period.

“Where the charterer redelivers the vessel with a surplus, the parties can agree on a sum to be paid by owners to charterers for generating such surplus, where that surplus remains with the vessel and has value.

“Subject to the duration of the charter period, charterers may also instruct owners on pooling, borrowing and banking.

“The clause can be adapted by the parties to suit their commercial arrangements, such as taking into account charter duration and whether owners have already committed to pools etc.

“Everyone affected by the Regulation feels strongly about its impact, and the clause has been structured to help achieve compliance. By offering guidelines and accommodating flexibility, the clause aims to provide a foundation for parties to collaborate and meet the Regulation’s requirements.

“The new clause ensures that FuelEU Maritime compliance is integrated into time charters, emphasising shared responsibility under the ‘polluter pays’ principle.”

Related: BIMCO adopts new CII clause for voyage charter parties 

 

Photo credit: BIMCO
Published: 28 November, 2024

Related Topics:
Continue Reading

FuelEU

Argus Media: Subsidised bio-LNG deemed eligible under FuelEU

Subsidised bio-LNG and other types of alternative fuels are deemed eligible under FuelEU Maritime Regulation, according to sources with knowledge of the matter.
Admin

Published

2 weeks ago

on

June 27, 2025

By

resized argusmedia

Subsidised bio-LNG and other types of alternative fuels are deemed eligible under FuelEU Maritime Regulation, according to sources with knowledge of the matter.

23 June 2025 

FuelEU allows emissions reductions supported under other legal frameworks, such as the support schemes under RED, in order to encourage greater investment in less carbon-intensive marine fuels.

Under Directive (EU) 2018/2001 (RED), the greenhouse gas (GHG) reductions are counted towards member states’ targets, while under FuelEU the targets are set to shipping companies.

Excluding subsidised marine fuels may otherwise lead to competitive disadvantages for smaller sectors, such as European biomethane.

The European Commission has not yet issued an official statement.

Demand for bio-LNG has risen sharply this year with the start of FuelEU Maritime in January, requiring ship-owners to reduce their GHG emissions by 2pc in 2025, with targets steadily rising to 80pc in 2050.

Subsidised, bunker dob bio-LNG in Northwest Europe was last assessed at €78.09/MWh ($89.55/MWh) on Thursday, while its unsubsidised counterpart was assessed at €93.59/MWh.

By Madeleine Jenkins

Bio-LNG vs Gas

Bio-LNG vs Gas

 

Photo credit and source: Argus Media
Published: 26 June, 2025

Continue Reading

FuelEU

OceanScore launches FuelEU Pooling Marketplace with first compliance surplus offers

Firm provides its customers the opportunity to choose between a wide range of potential compliance pools, choosing from offers that differ by price, volume, terms and other counterparty specific aspects.
Admin

Published

2 weeks ago

on

June 25, 2025

By

OceanScore launches FuelEU Pooling Marketplace with first compliance surplus offers

Hamburg-based technology platform OceanScore on Tuesday (24 June) announced that it has launched its FuelEU Pooling Marketplace with first compliance surplus offers now live.

OceanScore provides its customers the opportunity to choose between a wide range of potential compliance pools, choosing from offers that differ by price, volume, terms and other counterparty specific aspects. OceanScore does not operate the pools – the company’s focus is on matching multiple different compliance surplus and deficit holders within its extensive customer base.

This range of choices comes with prices offered by the different partners on OceanScore’s marketplace. Price midpoint on OceanScore’s marketplace currently sits at EUR 217 (USD 252) per tonne of CO2e. Prices trend higher for small volumes of a few hundred tonnes and can be significantly lower – substantially below EUR 200 per tonne – for larger volumes offered.

The company said this variety of offers to choose from marked a first in the market and a significant milestone in the development of a transparent and commercial approach to FuelEU Maritime compliance.

The mechanics of OceanScore’s FuelEU Pooling Marketplace assure that no other costs apply, neither for conducting the transaction itself or for managing the pool. OceanScore said it only charges an incremental administrative fee for onboarding partners onto the marketplace.

This early activity confirms that a working FuelEU pooling market is taking shape, delivering on the mechanism’s promise of flexibility and cost efficiency for ship operators and managers.

FuelEU Maritime allows DOC holders to pool vessel compliance balances. The process is straightforward: balances for 2025 are verified by March 31, 2026 and pooling declarations are submitted by April 30 in Thetis, the EU’s MRV system.

When pooling across with third parties, a simple commercial agreement is needed, defining the surplus volume, price, and terms. Importantly, these agreements can be made at any time, independent of regulatory timelines. Vessel selection and formal notification can follow later, making the system flexible and operationally manageable.

OceanScore’s marketplace facilitates these commercial processes in a “simple, transparent and reliable way”.

“We’re seeing the first real market movement and transactions, and it’s encouraging,” said Albrecht Grell, Managing Director at OceanScore. “Our customers now have the ability to compare offers and approach pooling as a commercial opportunity, not just a compliance task.”

Pooling vs. biofuels: A changing equation

Today, pooling is proving to be the most cost-effective option for many operators, especially those not already operating on LNG or LPG. Offers of around EUR 200/tCO₂e on the marketplace are, in many cases, more economical than switching to biofuels when adjusted for calorific value and ETS savings.

This may change though as the many factors driving the eventual cost of compliance continue to shift.

 

Photo credit: OceanScore
Published: 25 June, 2025

Continue Reading

Interview

Innospec: Marine fuel additives the ‘low hanging fruit’ alternative energy saving technology solution

‘In our return on investment table, you only need a 0.5% fuel saving to break even on an additives investment with us,’ states the Area Sales Manager of Innospec Limited Branch Office Singapore.
Admin

Published

1 month ago

on

June 5, 2025

By

Max Fok Innospec

In an interview with Singapore-based bunkering publication Manifold Times, Max Fok, China & Singapore Marine Sales Manager and Market Specialist, explains how the use of marine fuel additives offer low-hanging fruit solutions for shipowners sailing towards maritime decarbonisation:

MT: Innospec recently released its Q1-25 Sustainability Newsletter, highlighting that 20,000,000 metric tonnes (mt) of carbon dioxide (CO2) emissions were avoided through the use of their fuel additives in 2024. Could you elaborate on this achievement?

Absolutely. By applying conservative estimates for fuel economy improvements ranging from  2.4 to 4.8%, depending on the type of fuel being treated, our analysis shows an avoidance of over 20,000,000 mt of CO2 for our customers in 2024. This figure is more than 200 times our total annual emissions from our site operations and is equivalent to taking 4.5 million gasoline-powered cars off the road for a year or the carbon sequestration achieved by 340 million tree seedlings over a decade. This highlights the vital role of chemical innovation in helping us utilise natural resources more efficiently while minimising our environmental impact.

MT: That’s impressive. How many shipping companies have benefited from using Innospec’s Octamar Technologies?

Today, over 50 shipping companies have benefited from using Innospec™ Octamar Technologies helping to reduce CO2 emissions and supporting shipping decarbonisation. In 2024, we successfully treated 4.8 million mt of marine fuels.

MT: There are some misconceptions about the role of additives as Energy Saving Devices (ESD). Can you address these misconceptions and explain how additives should be used correctly?

The misconception in the industry is that additives are only used for troubleshooting. However, fuel management involves ensuring fuel stability and compatibility, preventing fuel degradation, and ensuring proper engine reliability.

Performance applications of additives are widely used outside of marine applications, such as in the automotive industry, where premium-grade petrol is used for fleet performance, reducing consumption and emissions.

Fuel additives can improve engine efficiency on board vessels as an Energy Efficiency Technology Solution, reducing fuel usage, emissions, and costs. Compared to other ESD solutions, additives are the easiest to implement while operating the vessel and complying with stringent regulations.

MT: Is there a return on investment for using additives on a vessel? How can Innospec prove their product works, and can the product be trialled by owners before full commitment?

Innospec has proven the effectiveness of our marine additive’s technology. We are the only additives company in the marine industry with an Innovation Endorsement Certificate awarded by ClassNK in 2022, stating 2.1%-3.9% fuel savings.

Compared to other ESDs, the return on investment is immediate. It is one of the low-hanging fruit solutions in the market. We always welcome owners to trial our product before full commitment. With today’s measurement technologies, it is possible. We have supported various owners and proven the effectiveness since 1997. Moreover, additives are the only ESD that you can monitor as many times as you want.

MT: Do most shipowners use additives in their operations? If not, why? What are the challenges of adopting additives in shipowners’ operations, and how can they overcome them?

Marine additives have gained significant attention since the implementation of the IMO 2020 Sulphur Cap Regulation, as they have proven effective in addressing tank cleaning and VLSFO fuel issues. Most shipowners now include additives as part of their fuel management policy for treating bunker fuel. The challenge lies in who should bear the cost of these additives. Many shipowners tend to push this cost to charterers because it’s the charterers who pay for the fuel. However, this viewpoint is slowly changing due to regulatory requirements. For shipowners, it’s about compliance and machinery reliability, while for charterers, the emphasis is on achieving  fuel savings. Ultimately, the advantages of using fuel additives benefits both parties.

MT: How can additives help shipowners meet regulatory requirements? Are there any case studies or examples you can share?

Innospec has many case studies showing average fuel efficiency savings of 2%-4%. In addition to the CO2 emission reduction associated with fuel savings, which help to avoid penalties such as those under FuelEU Maritime regulation, these savings also improve the CII rating of a vessel which supports the vessel’s journey towards the future IMO Net-zero Framework. With rising fuel prices, these savings could grow significantly. In an era of new bunker fuels, such as biofuels, the same efficiency gains could also cut costs of new bunker fuel usage, and provide additional savings from reduced emissions costs. This strengthens the business case for using additives as ESDs while also improving the economics of low-carbon fuels by lowering overall operational expenses.

MT: Finally, some people believe that additives are too expensive to use regularly on vessels due to the high cost. What would you say to them?

That is a misconception in the industry. As the popularity of additives has grown, many  companies have entered the market, making promises on high fuel savings of up to 10%-20%, but with very-high treat rates and costs. However, in this scenario  the so-called ‘additive’ can no longer be named ‘an additive’ but rather a blending component for the fuel.

Can you imagine adding 6,000 litres of chemical into 6,000 mt of bunker fuel? It would be a nightmare to the crew(!).

At Innospec, our technology treat rate is only between 167 to 333ppm, which is a very small dose rate. To put that into context just 1,000 litres of our additive is sufficient to treat 6,000 mt of fuel.

Max Fok’s contact details are as follows:

Max Fok
Area Sales Manager
Innospec Limited Branch Office Singapore
47 Scotts Road, #06-01 Goldbell Towers,
Singapore 228233
E-mail:  [email protected]

 

Photo credit: Manifold Times
Published: 5 June, 2025

Continue Reading

Trending