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FuelEU Maritime: Contractual alignment now or risk costly disputes, warns West P&I

Julien Rabeux, Head of Claims in Singapore, urges stakeholders to adopt BIMCO’s 2024 FuelEU clauses and define responsibilities in contracts to mitigate exposure.

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Julien Rabeux, Head of Claims (Singapore) at West of England P&I Club 1000 (L) x 600 (H)

Julien Rabeux, Head of Claims (Singapore) at maritime insurance provider West of England P&I Club (West P&I), warns that without clear clauses in ship management agreements and time charterparties, parties risk costly disputes, particularly as the first compliance assessments under FuelEU Maritime approach:

The maritime fuel landscape is shifting rapidly, and with the introduction of FuelEU Maritime on 1 January 2025, shipowners, managers, and charterers operating in Europe now face one of the most complex compliance frameworks to date. 

The regulation is designed to reduce the greenhouse gas (GHG) intensity of shipboard energy consumption, incentivise the use of onshore power supply in EU ports, and accelerate the uptake of alternative fuels. However, while its environmental ambitions are clear, its contractual implications are not – and that’s precisely where the risk lies.

Compliance liability lies with the ‘Shipping Company’ – but who pays?

Under FuelEU Maritime, the ‘Shipping Company’ – typically the Document of Compliance (DOC) holder – bears legal responsibility for compliance. That may be the registered owner, a third-party technical manager, or a bareboat charterer. Ships that fail to meet the required GHG intensity targets face remedial penalties. If non-compliance persists for two consecutive years, the ship could be issued an expulsion order.

To manage emissions, companies may bank or borrow compliance surplus or deficit across reporting years, and pool vessels to balance compliance within a fleet. These options may offer operational flexibility – but without contractual clarity, they also raise critical questions: Who pays the penalties? Who controls pooling decisions? Who retains the value of overcompliance?

West is urging all stakeholders to address these questions now – not after a penalty has already been incurred.

Contract clarity under SHIPMAN agreements

Where a technical manager is the DOC holder, the management agreement must clearly reflect FuelEU responsibilities. The BIMCO FuelEU Maritime Clause for SHIPMAN 2024 is a practical tool that helps allocate compliance obligations, including monitoring, reporting, and submission of plans to the relevant authorities.

In addition to administrative compliance, the contract should specify who controls the vessel’s compliance strategy – including decisions around banking, borrowing and pooling – and who benefits from any associated cost savings or revenue. It should also set terms for indemnity, including the timeframe for transferring funds to reimburse penalties, the provision of security, and what happens if reimbursement is delayed or withheld. Without such provisions, parties risk serious operational and legal disruption.

Time charterparties: don’t assume indemnity where none is written

The stakes are equally high in time charter arrangements. In the absence of a clause dealing explicitly with FuelEU compliance, owners may not be able to refuse to enter EU waters or seek an indemnity for penalties caused by charterer-supplied fuel – even if that fuel results in non-compliance. As such, relying on implied terms or assumptions is an unnecessary gamble.

The BIMCO FuelEU Maritime Clause for Time Charter Parties 2024 provides a robust contractual framework to address key issues and allocate responsibilities for compliance between owners and charterers. It requires owners to inform charterers of the vessel’s compliance balance on delivery and during the charter, mandates a monitoring plan and GHG reporting, and allows charterers to supply compliant fuel or pay a surcharge when necessary. It also provides mechanisms for compliance flexibility such as banking, pooling, borrowing, and surcharge payments, with rights to reimbursement and for owners to suspend performance if the surcharge is unpaid.

However, the BIMCO clause does not cover several critical areas, which must be considered and negotiated in addition to incorporating the standard clause:

Fuel specifications: The clause allows charterers to supply fuel but does not mandate standards or certifications (e.g. Renewable Energy Directive compliance, ISO specifications, GHG intensity). Separate provisions should specify which fuels are acceptable, certification requirements, and documentation to support compliance.

Performance warranties: The clause not address the impact of alternative fuels on vessel performance. Charterparties should include provisions for suspending or adjusting performance warranties when the calorific value of alternative fuels affects vessel operations.

Expulsion risk: While the clause covers surcharges and compliance mechanics, it does not address what happens if a vessel is expelled from EU waters due to non-compliance under FuelEU Maritime. Charterparties must clarify whether charterers can terminate or be liable in such scenarios.

Avoid assumptions, adopt structure

As we move toward the first full compliance assessments under FuelEU Maritime, disputes are likely to arise unless roles, risks, and rewards are properly apportioned. The 2024 BIMCO clauses – both for SHIPMAN and time charterparties – offer a practical, industry-consensus framework to help stakeholders avoid ambiguity and litigation.

This is not a theoretical risk. FuelEU Maritime brings with it financial penalties, operational restrictions, and reputational consequences. Contractual silence will not offer protection.

For owners, managers, and charterers alike, adopting standardised clauses and revisiting contract structures will not only provide legal certainty but also support operational planning and commercial agility. West is on hand to support its Members navigate these changes, review clauses, and manage contractual exposure.

 

Photo credit: West P&I
Published: 8 September, 2025

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FuelEU

Ahti Climate and DNV connect verified emissions data to FuelEU pooling platform

New integration connects Ahti’s FuelEU pooling platform with DNV’s verification services, Veracity, helping customers reduce manual administration and streamline compliance.

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Ahti Climate brings DNV-verified emissions data into FuelEU pooling platform

Ahti Climate on Monday (31 August) announced a new integration with Veracity, DNV’s independent industry cloud platform, enabling shipowners and operators to seamlessly transfer DNV-verified emissions data into Ahti’s FuelEU pooling platform. 

The integration simplifies emissions reporting by connecting operational data verification with FuelEU compliance workflows, helping customers reduce manual administration, improve data quality and confidently meet regulatory requirements.

For customers such as shipping company Bore Ltd, the integration streamlines the flow of emissions data between verification and compliance systems. Raw fuel consumption data is automatically converted into the required OVD format and submitted for DNV verification through Veracity. Once verified, the emissions figures are securely shared with Ahti’s FuelEU pooling platform, creating a more efficient workflow with less manual administration and greater confidence in reported emissions data.

“Being on one of the surplus generators of the pool, trust in the data is everything for us – we need to know the numbers we’re selling hold up to scrutiny. With verified emissions data flowing straight from Veracity by DNV into the Ahti Pooling Platform, we no longer have to manually cross-check figures before every transaction. It gives us confidence that what we’re bringing to the pool is accurate, and that our partners can rely on it too,” said Marcus Strand ICT Manager at Bore Ltd. 

The integration enables customers to:

  • Reduce manual data entry and administrative workload
  • Improve data quality and reduce the risk of reporting errors
  • Securely exchange verified emissions data across systems and stakeholders
  • Increase transparency and confidence in compliance reporting
  • Connect commercial, operational and compliance workflows
  • Reduce turnaround times for reporting and voyage settlements

“Every partnership we build comes back to the same question: does this make compliance easier for shipowners? With Veracity by DNV, the answer is clearly yes – verified data, connected systems, and one less thing for our customers to worry about,” said Risto-Juhani Kariranta, CEO of Ahti Climate. 

With connectivity to the majority of the world fleet, Veracity’s trusted partner ecosystem, combined with Ahti’s expertise in FuelEU pooling, gives shipowners a more connected approach to emissions verification and compliance. By enabling verified data to flow securely between systems, the partnership helps customers reduce complexity and get greater value from their data and access a growing network of digital solutions.

 

Photo credit: Ahti Climate
Published: 1 September, 2026

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Decarbonisation

NAPA: Why operational efficiency remains shipping’s golden ticket

With regulation tightening and alternative fuels still evolving, Pekka Pakkanen says operational efficiency offers shipping an immediate, scalable way to cut fuel use, emissions and costs.

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NAPA: Why operational efficiency remains shipping’s golden ticket

Shipping’s decarbonisation ambitions are clear but turning that ambition into commercially viable emissions reductions at scale remains a challenge.

As regulatory requirements tighten and fuel markets remain volatile, Pekka Pakkanen, Executive Vice President, Shipping Solutions, NAPA, says operational efficiency is emerging as one of the most immediate and scalable levers available to shipowners, with digital tools increasingly helping to maximise the benefits of energy efficiency technologies: 

The shipping industry’s decarbonization drive does not lack ambition – that is visible in the pace of innovation and research we see around us. But translating that ambition into action at scale and in a commercially viable way remains a different challenge altogether. The International Maritime Organization’s MEPC 84, which concluded in April 2026, reminded us of both how far we have come and how much complexity still remains.

Discussions around the Net-Zero Framework continued, with delegates agreeing to seek further consensus on key adjustments later in October 2026, while progress was made across several other fronts. Separately, the adoption of amendments designating the North-East Atlantic as a new Emission Control Area for Sulphur Oxides (Sox), particulate matter and nitrogen oxides (Nox) is a significant achievement. At the same time, the second phase of the review of the Ship Energy Efficiency Management Plan (SEEMP) and the Carbon Intensity Indicator (CII) began, focusing mainly on enhancing the SEEMP.

Progress, though incremental, is still being made in an environment defined by mounting regulatory obligations, volatile fuel markets, and a clean technology landscape still maturing. All these factors create a backdrop of uncertainty. It’s a word used often to describe shipping’s operating environment and still stands the test of time.

Why energy efficiency technologies remain key

Despite knowing this, the argument I want to put forward is a simple one that can help cut through the uncertainty. The single most accessible, most immediate, commercially viable and scalable lever available to shipping today for managing decarbonization is operational efficiency. Not instead of alternative fuels or new vessel technologies, but as the foundation on which everything else must be built.

Fuel price volatility has made efficiency a financial necessity as much as an environmental one. The European Union Emissions Trading System (EU ETS) and FuelEU Maritime are already in effect and tightening year on year. Add to this the second phase of the CII and SEEMP review, which MEPC 84 formally commenced, and all signs point to the need for operational performance data, optimization and reporting.

In today’s market, efficiency is both a sustainability metric and a margin protection strategy. Every tonne of fuel saved reduces exposure to volatile fuel prices, emissions costs, and operational uncertainty. The question for shipping executives is, therefore, is how to maximize the impact of efficiency.

The answer increasingly lies in the intelligent combination of digital tools and energy efficiency technologies. One development that has captured significant industry attention is the growing integration of wind-assisted propulsion systems (WAPS) with voyage optimization software. Harnessing the power of the wind is not just about installing sails, wings, or kites – it is also about navigating the inherent challenges that come with wind propulsion, from complex and fast-evolving weather patterns to training crew. Operating wind-assisted propulsion vessels requires both careful pre-planning and adjustments throughout a ship’s journey. Fast-evolving wind speed and direction, as well as waves and currents, must be assessed and constantly re-assessed throughout the voyage to determine the best possible route. Wind-assisted vessels need to catch winds at the right speeds and angles to make the most of their wings, rotors, or sails, which demands continuous route and speed modelling throughout the voyage not just before it. Relying on traditional means and manual methods alone risks leaving a lot of savings on the table. Instead, understanding changes in wind patterns and using this to the vessel’s advantage requires advanced digital tools.

Classification societies have also been responding to the increase in WAPS on the market and have included specific stability rule checks, which digital tools can help comply with. WAPS typically add weight to a vessel’s upper structure, shifting its center of gravity and creating additional stability considerations to be managed. Digital tools, within NAPA Design, can be used to calculate vessel stability characteristics and help users check their design’s performance against multiple classification society rules as well. These are all essential considerations to ensure the solution continues performing optimally.

Whether the technology is wind-assisted propulsion or air lubrication technology, digital technologies can help maximize the savings they deliver. Users can measure performance, adapt operations continuously and make decisions based on reliable data, which can then inform future investments in energy efficiency technologies.

MEPC 84 makes progress on the foundations underpinning global decarbonization 

The expansion of ECAs at MEPC 84 – including the newly designated North-East Atlantic zone – adds another layer of complexity. Research has consistently shown that ECA avoidance through route deviation is rarely the optimal commercial or environmental response; the fuel costs and schedule implications of detours frequently outweigh the cost of sailing through the zone with compliant fuel. Voyage optimization tools model these trade-offs in real time to help make better decisions than human assumptions alone.

MEPC 84 also progressed a review of the SEEMP framework, which remains central to how vessels document and demonstrate their carbon intensity management. The direction of travel is towards increased expectations around the quality, granularity, and integration of performance data. As regulatory frameworks increasingly rely on verifiable performance data, the quality of operational data becomes just as important as the technologies being measured. Poor data quality can undermine both compliance confidence and optimization efforts. Shipowners who have already invested in the digital infrastructure to capture and act on operational data will find themselves significantly better positioned, both for compliance and for commercial advantage.

The case for integrated data systems – platforms that bring together performance analytics, voyage planning, regulatory compliance, and reporting in a coherent interface – is a response to genuine operational needs. When data from signals, noon reports, and logbook entries can be brought together on one platform to produce clear, actionable insights, crews spend less time managing information and more time using it. The same shared source of operational truth also supports better ship to shore collaboration to support real-time route and speed optimization, continuous hull performance monitoring, and integrated compliance management.

None of this diminishes the importance of the longer-term energy transition. Alternative fuels, new energy efficiency technologies, and next-generation vessel design all have a critical role to play in reaching net zero by 2050. But those transitions take time, capital, and regulatory frameworks that are still being finalized. In the interim, and complementing those transitions, operational efficiency represents a proven, scalable, and commercially viable path to meaningful emissions reduction. The industry does not need to wait for its decarbonization ‘golden ticket’ to arrive from future technology. It already holds one. The challenge now is not identifying opportunities for efficiency but capturing them consistently across fleets and voyages.

 

Photo credit: NAPA
Published: 28 August, 2026

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Alternative Fuels

Peninsula: Bio-LNG offers practical route to shipping decarbonisation

Company outlines why bio-LNG is emerging as a key fuel pathway in the maritime energy transition including playing a role in helping operators manage their emissions profile.

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Marine fuels supplier Peninsula recently published an article on why bio-LNG is emerging as a key fuel pathway in the maritime energy transition:

As the maritime industry accelerates its decarbonisation journey, operators face a growing challenge: reducing emissions while maintaining operational efficiency and commercial viability. While no single fuel offers a universal solution, Bio-LNG is increasingly attracting attention as a practical pathway for LNG-fuelled vessels seeking immediate emissions reductions without major infrastructure changes. 

The conversation around alternative fuels often focuses on future technologies and long-term investments. However, for many operators, the more pressing question is how to reduce emissions today using solutions that can be implemented within existing operations. This is where Bio-LNG presents a compelling proposition. 

“As operators look to balance compliance, cost and operational performance, Bio-LNG offers a practical solution that can be integrated into existing LNG infrastructure today. Increasing availability across key bunkering locations is helping turn decarbonisation ambitions into operational reality.” Cristina Danes, LNG Supply Trader, Peninsula. 

Building on Existing LNG Infrastructure 

BioLNG is a renewable marine fuel produced from certified biogenic waste feedstocks. While its origin differs from conventional LNG, it remains chemically equivalent, allowing it to be used within existing LNG infrastructure and dual-fuel engines. This compatibility eliminates the need for costly vessel modifications or extensive retrofitting programmes, reducing both complexity and investment requirements. 

For operators that have already invested in LNG-capable vessels, bioLNG offers a clear route to further improve environmental performance while leveraging existing assets and supply chains. 

The increasing availability of bioLNG across key bunkering hubs is helping remove barriers to adoption. Recent supply operations, including Peninsula’s first Bio-LNG delivery in the Port of Cadiz, illustrate how renewable marine fuels are becoming more accessible through existing LNG supply chains. 

Delivering Meaningful Emissions Reductions 

As regulatory requirements continue to evolve, the ability to demonstrate measurable emissions reductions is becoming increasingly important. BioLNG can achieve lifecycle greenhouse gas emissions reductions of up to 90% compared with conventional marine fuels when produced from certified waste-based feedstocks. 

These reductions represent a significant opportunity for vessel operators looking to improve their environmental performance while balancing commercial considerations and operational requirements. 

Supporting Regulatory Compliance 

Alongside emissions reduction targets, compliance is becoming an increasingly central consideration in fuel procurement decisions. 

Frameworks such as FuelEU Maritime are creating new incentives for lower-carbon fuel adoption while introducing additional complexity into compliance planning. In this environment, BioLNG can play an important role in helping operators manage their emissions profile and support broader compliance strategies, including participation in mechanisms such as FuelEU pooling. 

As regulations continue to develop, flexibility will become an increasingly valuable asset. Fuels that can deliver both environmental and compliance benefits are likely to play a growing role in operators’ fuel strategies. 

A Practical Step Forward 

The maritime energy transition will require a mix of solutions, technologies and fuel pathways. While longer-term alternatives continue to develop, BioLNG provides an immediately available option for LNG-fuelled vessels seeking to reduce emissions and prepare for a more carbon-conscious operating environment. 

For many operators, the transition to lower-carbon shipping will not be defined by a single transformational change, but by a series of practical steps. BioLNG represents one such step: leveraging existing infrastructure, supporting regulatory compliance and helping bridge the gap between today’s operations and the future of shipping.

 

Photo credit: Peninsula
Published: 11 August, 2026

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