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ESPO ports concerned about ‘first signs’ of carbon and business leakage ahead of EU ETS

‘One must realise, that once evasion is established, and trading routes have changed, it will be very difficult to reverse the negative developments,’ says ESPO Secretary General.

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The European Sea Ports Organisation (ESPO) on Wednesday (20 September) reiterated its support for an emission trading scheme as instrument for greening the shipping sector but expressed serious concern about first signs of carbon and business leakage due to the limited scope of the current legislation.

It was replying to a public consultation on the list of non-EU neighbouring ports that would fall under the “transhipment clause” that has been introduced in the EU emission trading system (ETS) directive intended to limit the risks of carbon and business leakage once the EU ETS maritime comes into force.

The statement from ESPO is as follows:

For ESPO, the principle to not consider as a “port of call”, in the counting of the ETS charges, the calls to some transhipment ports neighbouring the EU is only a partial solution to the problem. ESPO fully agrees with the identification of Tanger Med and East Port Said as major neighbouring transhipments ports. However, it will not be enough to ensure that evasion cannot take place. While only a few neighbouring ports are reaching the very high transhipment volume thresholds put forward in the legislation (65%), many ports and terminals around Europe have and/or are building up transhipment capacity. The Commission should therefore not only look at current volumes, but also consider the transhipment capacity in the different ports neighbouring the EU.

Moreover, under the current legislation, even if the call at a non-EU transhipment port is subject to the special regime, it is still more favourable for ships to call at a non-EU port than at an EU transhipment port. When ships call at an EU transhipment port, the last leg between the transhipment port and any other EU port is subject to ETS charges for 100% of the journey. On the other hand, if the ships call at a non-EU transhipment port, only 50% of the journey is accounted for.

“We see a real ramping up of investments in additional TEU capacity in ports and new terminals in neighbouring countries, including investments realised by major shipping lines in these ports, and we also hear about first rerouting movements outside Europe. This reinforces the idea that shipping lines, where relevant, are preparing their way out of the EU ETS maritime. We recognise the importance of the EU ETS Directive and supports its aim, but we continue to regret that this legislative framework disadvantages EU ports vis-à-vis non-EU ports, without the expected benefit in terms of emission reduction”, stresses Zeno D'Agostino, Chairman of ESPO.

For the maritime EU ETS to be a success, the European Commission must make sure that the ETS implementation safeguards the competitiveness of European ports, and avoids carbon and business leakage to ports neighbouring the EU.

For Europe’s ports, monitoring should already take place ahead of the application date, as rerouting and evasion movements are already in preparation or happening now. Moreover, the monitoring should happen continuously, not only with a report every two years.

“One must realise, that once evasion is established, and trading routes have changed, it will be very difficult to reverse the negative developments”, says Isabelle Ryckbost, ESPO Secretary General.

While it is difficult to prove a direct causal link between certain rerouting and developments of terminals outside the EU, the level and intensity of recent developments in non-EU ports strengthen the concern of many European affected ports on the possible adverse effect of the EU ETS without the expected environmental benefit. On top of losing transhipment capacity and the corresponding jobs, Europe risks losing oversight and control of the entire supply chain.

Given the current situation and developments and the serious consequences of the implementation of this legislation for the competitiveness and future of some European ports, ESPO hopes for an open, continuous and constructive dialogue with the Commission allowing to map adverse impacts and signal evasion at a very early stage, in view of achieving an ETS that delivers the ambitions it has been designed for.

Photo credit: European Sea Ports Organisation
Published: 21 September, 2023

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Emissions reporting

Spinergie and Veracity by DNV team up on maritime emissions reporting

Partnership will integrate Spinergie’s Smart Fleet Management solution with the Veracity platform and connect Spinergie’s Smart Reporting module with DNV’s Emissions Connect.

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Spinergie and Veracity by DNV team up on maritime emissions reporting

Maritime technology company Spinergie on Tuesday (26 November) announced a strategic partnership with Veracity, the maritime emissions data cloud from DNV. 

Together, they offer clients a comprehensive, automated system for collecting, processing, and verifying emissions data.

The partnership will integrate Spinergie’s Smart Fleet Management solution with the Veracity platform and connect Spinergie’s Smart Reporting module with DNV’s Emissions Connect. Smart Reporting collects data via multiple sources, including sensors, GPS/AIS, and manual entry. 

Crucially, Spinergie’s in-built mechanisms ensure the quality of ship data. By connecting with Emissions Connect through Veracity, this data can be directly verified, ensuring compliance with the IMO DCS, EU MRV, and FuelEU Maritime regulations.

Spinergie’s client, SMT Shipping has selected the partnership to streamline its data management processes and ensure regulatory compliance. SMT Shipping benefits from a suite of tools tailored to make their operations more efficient. 

These include simplified and guided manual data entry, reinforced with automatic population and robust quality checks. Quality checks at the reporting source reduce the need for a back-and-forth between the verifier and SMT’s crews, making significant time savings.

Further time savings are achieved through single-entry data, with multiple reports generated from a centralized dataset and automatically exported to relevant internal and external stakeholders as required.

"Through Spinergie’s Smart Fleet Management solution, SMT Shipping has taken steps to significantly reduce the administrative burden of our crews and office staff. This system allows the seamless reporting of consumption and emissions data to regulatory bodies, and most importantly gives SMT the great benefit of a platform to access all operational and technical details about our voyages and vessels,” said Joep Groot, Business Optimization & Projects, SMT Shipping.

"Veracity’s partnership with Spinergie enhances our ability to support maritime clients in their journey towards sustainability. By providing seamless access to verified emissions data, we empower companies like SMT Shipping to efficiently bring trust into their emissions data and adhere to stringent environmental regulations," said Mikkel Skou, Executive Director for Veracity by DNV.

"Our partnership with Veracity by DNV aligns with our mission to provide clients with the tools to reduce the reporting and admin workload of crews and office staff. Together, we offer a solution that simplifies emissions data management and helps shipping companies achieve their sustainability goals,” added Jean Cristofari, CEO and Co-Founder of Spinergie.

The collaboration between Spinergie and Veracity by DNV is a significant step in adopting digital technologies and data standardization in the maritime sector. The partnership will help clients, including SMT Shipping, achieve peak efficiency and improve environmental performance through real-time, verified emissions data.

 

Photo credit: Spinergie
Published: 28 November, 2024

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Emissions reporting

DNV simplifies reporting compliance for Asian shipowners with Emissions Connect

DNV shares how its online tool can help Asian shipowners and operators such as Singapore-based UMMS overcome challenges in emissions reporting to comply with global regulatory frameworks such as EU ETS and FuelEU.

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DNV simplifies reporting compliance for Asian shipowners with Emissions Connect

The global regulatory framework aiming to decarbonize the shipping industry has reached a considerable level of complexity, confronting Asian shipowners and operators with the challenging task of collecting, managing, verifying and reporting emission data on a regular basis. DNV has developed a comprehensive online emission data validation and management tool that helps the industry share trustworthy data:

New rules require a new approach

The IMO’s Carbon Intensity Indicator (CII), the management of EU allowances (EUAs) within the EU Emissions Trading System (ETS), and the forthcoming FuelEU Maritime Regulation come with challenges for the maritime industry. There are still wide-spread misconceptions about the EU ETS scheme, and many registered owners have not realized that it is their responsibility to report emissions and purchase EUAs for their vessels operating in European waters.

“Purchasing and surrendering emission allowances under the EU ETS can be costly for shipping companies,” explains Dominic Ng, Head of APAC Veracity at DNV in Singapore. “This has consequences for contractual agreements between parties across the value chain.”

For shipowners, ship operators and managers, charterers and cargo owners, it is crucial to collaborate closely to ensure compliance and avoid the risks of defaulting on emission reporting duties, incurring unnecessary costs, and experiencing data handling errors. For example, to compute ETS exposure and file the consolidated end-of-voyage emission reports, charterers need daily emission data feeds from their ships.

A digital tool establishing a single source of truth

Of critical concern is the accuracy and reliability of the reported emission data because it influences the number of EU allowances that must be purchased. The data collected on board should therefore be verified and receive a “stamp of approval” from a trusted third party.

Recognizing these needs, DNV developed its online tool Emissions Connect, available on the Veracity platform. “Emissions Connect combines three key functionalities the shipping industry needs to comply with decarbonization regulations: consistent management of emissions data, easy integration of business partners, and quick generation of the mandatory statements,” Ng points out. “It provides the trusted single source of truth everyone needs for efficient emission reporting.”

DNV simplifies reporting compliance for Asian shipowners with Emissions Connect

Union Marine believes in being proactive

Many shipowners in Asia erroneously believe that EU ETS compliance is exclusively the charterer’s responsibility, says Vinay Gupta, Founder and Managing Director of Singapore-based Union Marine Management Services Pte. Ltd. (UMMS). “We started our EU ETS compliance programme in August of 2023. I personally held a two-hour session with each of our 18 clients operating ships in EU waters, explaining to them what EU ETS stands for and how it will affect them, how they can manage it, and how they can mitigate any inherent risk.”

UMMS had been using DNV’s Veracity data platform for IMO DCS and EU MRV verification since 2019. When Emissions Connect was added, DNV helped UMMS integrate the solution with their ERP system through an application program interface (API). Today UMMS uses Emissions Connect for all vessels going on EU voyages, or roughly 25 per cent of their managed fleet.

Convenience, transparency and data security

“Emissions Connect has added value by streamlining the way our data is arranged,” Gupta continues. “Following integration of Emissions Connect, we were able to identify the gaps in our reporting system and now the data undergoes many more levels of checks and sanitation before it is synchronised with the Emissions Connect portal for verification.”

“Verified EU ETS statements can be generated quickly and submitted to the owner or charterer within seven days of voyage completion”, Gupta adds. “Emissions Connect has a user-friendly interface, and its voyage simulation feature assists in planning future CII ratings for an intended voyage, helping managers proactively maintain vessel emission levels. All this brings added value to our clients.”

When a German bank offered its emission allowance trading services to UMMS, Gupta opened a certificate trading account as the final element in a seamless EU ETS value chain: Fuel consumption data captured on board and transmitted to shore in the noon report is subsequently routed through the API to DNV’s Veracity and Emissions Connect, where it is quality assured and verified. From here the trusted data is seamlessly transmitted to the trading account. “This end-to-end process is so convenient we are now offering it as a service to many clients, including some whose ships are not even under our management,” says Gupta.

“With the DNV Emissions Connect, we can have transparency and effective monitoring of the data being submitted and verified,” explains Gupta. “All the calculations on Emissions Connect are in line with the latest requirements and are accepted industry-wide.” Thanks to its EU ETS know-how, UMMS can now be of help to companies struggling to understand the regulation. “Many owners still don’t know what it is they need to know to carry on with their business,” Gupta points out.

Getting ready for FuelEU Maritime

“DNV are very mature in their understanding of the regulations and how they have to be implemented,” summarizes Gupta. “They are a good partner to have in the current situation – a very collaborative, proactive, forward-thinking organization.”

As both companies’ experiences with the EU ETS introduction have shown, this proactive mindset is enormously helpful in coping with regulatory challenges. Both organizations strongly believe in helping shipowners understand that increasing the efficiency of their vessels can improve CII ratings, lower EU ETS costs incurred and enhance the competitiveness of their vessels.

The next major challenge, FuelEU Maritime, will add further complexity to emissions reporting: Reconciling regulatory deadlines and commercial obligations will require even closer alignment and synchronization between the stakeholders. However, with a unified, common data architecture and a centralized “single source of truth” available for secure data sharing, and with a smooth emission reporting process in place, that next step should quickly lose its scare.

 

Photo credit: DNV, UMMS
Published: 22 November, 2024

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Emissions reporting

VPS and Veracity by DNV partner to streamline MRV Reporting for offshore vessels

Partnership will enable a transfer of validated and checked operational MRV data from VPS’ Maress system, to Veracity data platform, where it is connected to the DNV’s real-time data verification services.

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Maritime decarbonisation advisory services company VPS on Tuesday (19 November) said it has signed an agreement to streamline MRV reporting for offshore vessels and DNV’s maritime emissions cloud Veracity.

The partnership will enable a seamless transfer of validated and checked operational MRV data from VPS’ Maress system, to the Veracity data platform, where it is connected to the DNV's real-time data verification services. 

By streamlining data collection, validation and verification, this integration will help shared customers simplify and secure quality of their emissions reporting and be prepared for ETS from 2027 (vessels > 5,000 GT).

Sveinung Økland, Operation Manager, North Sea Shipping, said: “We collect all consumption data for our fleet in Maress and are excited that the validated and checked quality data in Maress automatically will flow to DNV for efficient verification. This reduces the admin related to MRV significantly for our staff.” 

Mikkel Skou, Executive Director at Veracity, DNV, said: “The Partner Agreement and integration of Veracity and VPS’ Maress is a step in our joint mission to foster a more data-driven and connected maritime industry.”

“As verified emissions data becomes central to both regulatory compliance and contractual obligations, this collaboration simplifies the reporting process, helping fleet operators like North Sea Shipping share crucial data with confidence across the value chain.”

With new MRV (Monitoring, Reporting, and Verification) regulations coming into effect on January 1, 2025, now also covering offshore vessels over 400 GT entering EU/EEA ports, VPS’ Maress system for Data-Driven Decarbonisation is equipped with an MRV Reporting Module supporting data validation and checks, voyage validation and automated data transfer to Veracity by DNV. 

Maress’ advanced data quality algorithms will minimise the need for verification cycles and accelerate compliance. The vessel owner receives reports including verified voyages ready for upload to Thetis MRV.

Jan Wilhelmsson, COO Digital & Decarbonisation, VPS, said: “This partnership represents a great step toward efficient and accurate MRV reporting for the offshore industry.”

“By combining VPS’s expertise in data-driven decarbonisation with DNV’s trusted verification platform, we are equipping offshore vessel operators with the tools to streamline compliance and accelerate their sustainability goals.”

More than 600 offshore vessels, ranging from PSVs, AHTSs, OCVs, Seismic, Cable layers, WTIVs, CSOVs and more, use Maress for fuel and emission monitoring, optimisation, and reporting. 

Some of the 300 vessels participating in VPS’ summer campaign saved up to 28% emissions utilising the Maress dashboards for unique collaboration and monitoring of decarb initiatives. The platform is also central in the collaboration between vessel owners, charters, crew and operators in the offshore and offshore wind industry to reach their decarb targets.

 

Photo credit: VPS
Published: 20 November, 2024

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