Last Friday, we kicked off our #FuelEU compliance quiz! 🌊 We hope you enjoyed the challenge and had some #FridayFun while testing your knowledge on strategies for meeting FuelEU requirements. Let's dive into the solution and explore the rationale behind it.
Friday's Question:
For which of the below vessels would you consider FuelEU Maritime banking as a smart means of compliance with FuelEU?
Possible Answers with Given Responses:
HFO vessel - 20%
MeOH vessel - 30%
Dual-fuel LNG vessel - 20%
Bio30 vessel - 30%
Correct Answers:
Dual-fuel LNG vessel
Bio30 vessel
General Overview:
What is FuelEU Maritime Banking in Compliance?
Banking in the context of FuelEU compliance refers to the process by which a vessel that has achieved a compliance surplus (i.e., its greenhouse gas (GHG) intensity or RFNBO (Renewable Fuels of Non-Biological Origin) subtarget performance is better than required) can carry over this surplus to offset future deficits. This mechanism allows vessels to store their compliance surplus for future use, effectively smoothing out the compliance process over multiple years.
FuelEU Maritime banking is particularly useful for vessels facing varying operational conditions or fuel availability over time, providing a flexible strategy to maintain compliance with evolving regulations. However, it's essential to note that banking is vessel-specific; the surplus generated by one vessel can only be used by that same vessel in subsequent reporting periods.
Rationale Behind the Correct Answers for FuelEU Maritime Banking:
When it comes to banking, it’s crucial to remember that banking is only allowed for the same vessel. Here’s a breakdown of why Dual-fuel LNG vessels and Bio30 vessels are the smart choices for banking under FuelEU:
Dual-fuel LNG Vessel: These vessels can accrue a compliance surplus during the period from 2025 to 2030. This surplus can be banked and used when these vessels become non-compliant from 2030 onwards.
Bio30 Vessel: A Bio30 vessel, which runs on a blend of biofuels and traditional fuels, can generate a surplus. This surplus can be banked and used in future years when the vessel might be running on more conventional fuels like HFO due to e.g. fuel availability, thus ensuring compliance in those years.
Why Not the Other Vessels?
HFO Vessel: HFO vessels do not generate a surplus under FuelEU and therefore cannot benefit from banking, as it is only allowed for the same vessel.
MeOH Vessel: While a MeOH vessel (methanol-fueled) generates a surplus, it is not as advantageous for banking because it will maintain a compliance surplus for years to come and has as such no option to utilize the banked surplus for its own compliance needs. Planning for compliance in the far future, such as around 2040 to 2050, is not advisable due to potential changes in fuel infrastructure and availability.
Regulatory Context:
The relevant portion of the FuelEU Maritime Regulation regarding banking is detailed in Article 20:
"On the basis of the calculations undertaken in accordance with Article 16(4), where the ship has, for the reporting period, a compliance surplus on its GHG intensity as referred to in Article 4(2) or, if applicable, on the RFNBO subtarget as referred to in Article 5(3), the company may bank it to the same ship’s compliance balance for the following reporting period. The company shall record the banking of the compliance surplus to the following reporting period in the FuelEU database subject to approval by its verifier. The company may no longer bank the compliance surplus once the FuelEU document of compliance has been issued."
For more detailed information, refer to the full text of the FuelEU Maritime Regulation (EU) 2023/1805 on the EUR-Lex website.
We hope this explanation enhances your understanding of FuelEU compliance strategies and the smart use of banking surpluses. Stay tuned for our next quiz this Friday!
Feel free to reach out if you have any further questions or are interested in learning more about how BetterSea's streamlined and end-to-end FuelEU software solution can help achieve cost-efficient and effortless compliance.
Best regards,
BetterSea Team
Contact Us: info@bettersea.tech
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