EU ETS 2026: What Shippers and Carriers Need to Know About Full Compliance and Rising Costs

The European Union’s Emissions Trading System (EU ETS) is set to enter its most critical phase in 2026. After a gradual phase-in, the maritime sector will face full compliance, with 100% of CO₂ emissions subject to carbon pricing—and, for the first time, methane (CH₄) and nitrous oxide (N₂O) may also be included from June onwards. This shift will bring higher costs, stricter reporting requirements, and new strategic challenges for both shippers and carriers.

In this guide, we’ll explore:

• The 2026 EU ETS Phase-In: What’s Changing?
• The Impact of Methane and Nitrous Oxide Inclusion
• Rising Costs: Carbon Prices and Surcharges
• Regulatory and Operational Challenges
• Strategies for Shippers and Carriers
• Industry Response: How Carriers Like Maersk Are Preparing

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The 2026 EU ETS Phase-In: What’s Changing?

Full Emissions Coverage

From January 1, 2026, shipping companies will be required to submit allowances for 100% of their verified CO₂ emissions for all voyages involving EU or EEA ports. This marks the end of the phased implementation, which began with 40% coverage in 2024 and 70% in 2025.

What does this mean?

• No more partial exemptions: Every tonne of CO₂ emitted on EU-related voyages must be accounted for, increasing the financial burden on carriers.
• Higher compliance costs: With full coverage, the cost of EU Allowances (EUAs) will directly impact freight rates and surcharges.

Geographical Scope

The EU ETS applies to:

• 100% of emissions for voyages between two EU ports.
• 50% of emissions for voyages starting or ending outside the EU.

This means that even vessels calling at just one EU port will be partially liable, making route planning and port selection critical for cost management. Not to forget that other ETS markets schemes that should kick off in 2026 (UK) and the IMO global pricing mechanism that may be adopted. 

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The Impact of Methane and Nitrous Oxide Inclusion

Why It Matters

Starting in 2026, the EU ETS will expand to include methane (CH₄) and nitrous oxide (N₂O), two potent greenhouse gases:

• Methane has a global warming potential 28 times higher than CO₂.
• Nitrous oxide is 228 times more potent than CO₂.

Implications for Carriers:

• LNG-powered vessels, which emit methane during extraction, transportation and bunkering (a phenomenon known as “methane slip”), will face higher compliance costs.
• Operators using traditional marine fuels (e.g., heavy fuel oil) will also need to account for N₂O emissions, further increasing costs.

Industry Response

The inclusion of these gases is designed to incentivise a shift toward cleaner fuels, such as:

• Methanol
• Ammonia
• Hydrogen
• bioLNG
• Advanced biofuels

However, the infrastructure and cost of these alternatives remain significant barriers.

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Rising Costs: Carbon Prices and Surcharges

Carbon Price Projections

The price of EU Allowances (EUAs) is expected to rise sharply as demand increases and supply tightens:

• 2024–2025: €65–€90 per metric ton of CO₂.
• 2026: According to the Deutsche Bank, the EU carbon price should range between  60 and 150 € in 2026, depending on market conditions.

Impact on Freight Costs

For shippers, this means:

• Surcharges updates will almost certainly include an increase compared to 2024–2025 levels.
• The operating cost of an average bulk vessel trading within the EU could increase by €1.3 million annually in 2026.

Carrier Surcharges: Transparency Concerns

All major ocean carriers serving Europe  have already introduced EU ETS surcharges, but concerns persist about overcharging and lack of transparency. For example:

• A 2024 analysis by Transport & Environment found that some carriers may be generating windfall profits from surcharges, with Maersk estimated to make €60,000 per voyage in excess charges.

Shippers’ Action Point: Use tools like Searoutes’ Freight Emissions Reporter to verify EU ETS emissions calculations and ensure they align with actual emissions and EUA costs.

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Regulatory and Operational Challenges

1. Administrative Burden

• Monitoring, Reporting, and Verification (MRV): Companies must accurately track and report all GHG emissions, including the newly added methane and nitrous oxide. Failure to comply risks fines and reputational damage.
• Deadlines: Allowances must be surrendered by September 30 each year, based on the previous year’s emissions.

2. Route and Port Optimisation

• Transshipment Shifts: Some carriers may adjust routes or ports of call to minimise EU ETS exposure, potentially leading to increased use of non-EU hubs.
• Onshore Power Supply (OPS): From 2030, ships at berth in EU ports will be required to use zero-emission technologies, adding another layer of compliance.

3. Fuel Switching and Infrastructure

• The push toward low-carbon fuels (e.g., methanol, ammonia) is accelerating, but infrastructure gaps (e.g., bunkering facilities, engine compatibility) remain a hurdle.

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Strategies for Shippers and Carriers

For Shippers:

1. Negotiate Transparent Surcharges
   • Request detailed breakdowns of EU ETS surcharges from carriers.
   • Use third-party tools (e.g., Freight Emissions reporter with EU ETS) to validate costs and identify overcharging.
2. Optimise Supply Chain Routes
   • Using EU ETS visibility solutions such as Searoutes, choose services whose EU ETS charges should be lower, for example calling in the UK first,or whose latest port of call is closer to Europe (Jeddah or Walvis Bay being better than Singapore or Colombo) 
   • Consider multimodal transport (e.g., rail or short-sea shipping) to reduce reliance on high-emission voyages.
3. Plan for Volatility
   • Beyond regulations and growing baselines, carriers have been steadily increasing surcharges (Q2 2025 went +11% vs. Q1 2025 charges) 
   • Explore long-term contracts with carriers to lock in rates and share decarbonisation risks.

For Carriers:

1. Invest in Low-Carbon Fuels and Technologies
   • Prioritise LNG, bioLNG, methanol or other alternative fuels for new builds and retrofits.
   • Collaborate with fuel suppliers and ports to ensure infrastructure availability.
2. Enhance Emissions Tracking
   • Implement real-time MRV systems to improve accuracy and compliance.
   • Provide transparent surcharge breakdowns to build trust with shippers.

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Industry Response: How Carriers Like Maersk Are Preparing

Maersk’s Strategy

• Green Fuels: Maersk is investing in methanol-powered vessels, with plans to operate its first carbon-neutral liner by 2027.
• Emissions Dashboard: The company offers customers a real-time emissions tracking tool to monitor their carbon footprint across Maersk and non-Maersk logistics.
• Operational Collaboration: Through the Gemini Cooperation with Hapag-Lloyd, Maersk aims to improve network efficiency and sustainability.

Broader Industry Trends

• Alternative Fuels: Carriers are testing ammonia, hydrogen, and biofuels, though scalability remains a challenge.
• Route Adjustments: Some operators are rerouting vessels to avoid EU ports or reduce exposure to ETS costs.

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Conclusion: Preparing for 2026 and Beyond

The EU ETS 2026 milestone will bring full emissions coverage, expanded gases, and higher costs, reshaping the maritime industry’s approach to compliance and sustainability. Shippers and carriers must act now to:

• Verify surcharges and negotiate fair terms.
• Optimise routes and fuels to reduce emissions and costs.
• Invest in transparency and collaboration to navigate the transition smoothly.

Ready to optimise your EU ETS strategy?

You can check our Complete Guide to EU ETS (2024) here.

• Download the EU ETS White Paper
• Book a meeting with Josie Hansen