The compounding effect of national and regional maritime decarbonisation regulations

The maritime community has long argued for global regulation. The reason is straightforward: an international industry is better served by a coherent global framework than by overlapping national and regional regimes. With the adoption of the IMO Net-Zero Framework delayed and political consensus uncertain, the latter becomes a real risk. Regulatory pressure will and in fact is already reappearing elsewhere. The EU has already moved ahead with EU ETS and FuelEU Maritime. The UK is extending its own emissions trading scheme to shipping. African countries have or are implementing national carbon tax schemes.

This creates a different type of commercial risk. The cost of carbon is no longer attached to only one regulation. It increasingly becomes a layered cost exposure that depends on the vessel’s trading pattern, the ports it calls, the emissions generated on each leg, and the way different regimes define their scope. In combination, they can materially change voyage economics.

A theoretical worst-case voyage

To illustrate this effect, consider a theoretical voyage from Djibouti to Gabon, then from Gabon to Rotterdam, and finally from Rotterdam to the United Kingdom.

The route consists of several different operational phases: time in port in Djibouti, a sea leg from Djibouti to Libreville, time in port in Libreville, a sea leg from Libreville to Rotterdam, time in port in Rotterdam, a sea leg from Rotterdam to Liverpool, and finally time in port in Liverpool.

For the purpose of this case study, the vessel is assumed to consume 55 tonnes of HFO per day at sea and 15 tonnes per day in port. Each port stay is assumed to last two days, the sailing speed is approximately 14 knots, and the HFO price is assumed at EUR 450 per tonne.

The carbon price assumptions are EUR 79.50 per EUA and EUR 65.00 per UKA. The scenario is a theoretical worst-case scenario designed to show how quickly voyage costs can compound once several regulatory perimeters are applied to one trading pattern. It is not the intention to create the worst "worst-case scenario" for a vessel as one could think of cases for which even exposure to just one region could create major impacts on the voyage expenses. Instead, the scenario's purpose is to show all existing carbon regulations that directly impact a vessel in combination.

On these assumptions, the vessel’s fuel cost amounts to EUR 747,000. This is the starting point. Without carbon regulation, this would be the main fuel-related cost line for the voyage.

The compliance stack when national and regional maritime decarbonisation regulations compound

The EU ETS exposure in the scenario requires about 965 EUAs, resulting in EU ETS costs of EUR 76,717.50. FuelEU Maritime adds a separate exposure. The vessel’s GHG intensity is 91.74 gCO2e/MJ, resulting in a compliance balance of -29.74 tonnes CO2e and a FuelEU compliance penalty of EUR 18,973.69.

In addition, the scenario includes other compliance exposure connected to the route, consisting of EUR 19,735.20 in other carbon taxes such as Gabon and Djibouti, and EUR 6,168.11 in UKA-related costs. Together, these additional elements amount to EUR 25,903.31.

The total compliance exposure is therefore EUR 121,594.50.

This means that the regulatory cost stack is no longer marginal. Compared to the underlying fuel cost of EUR 747,000, the compliance exposure adds about 16%. In other words, the carbon-adjusted fuel cost is not EUR 450 per tonne. It is about EUR 523 per tonne. The vessel still consumes HFO at EUR 450 per tonne, but the effective fuel cost after regulatory exposure is materially higher.

It becomes clear that carbon regulation is no longer a peripheral cost item. Note, the cost increase does not arise from one regulation alone. It arises from the combined effect of several regimes applying across different parts of the trading pattern. EU ETS, FuelEU Maritime, UK-related exposure and other carbon charges each contribute to the total. This is the compounding effect of fragmented national and regional maritime decarbonisation regulation.

Fragmentation changes how fuel costs should be understood

Traditionally, voyage fuel economics were driven mainly by bunker price, consumption and distance. Carbon regulation changes this calculation. The same tonne of fuel may now create different economic consequences depending on where it is consumed, which port the vessel is sailing to, which regulatory perimeter applies, and whether the relevant scheme prices emissions, fuel intensity, or applies a national levy.

This is why carbon exposure should increasingly be treated as part of the effective fuel cost rather than as a separate administrative compliance item. In the scenario above, the vessel does not simply buy HFO at EUR 450 per tonne. It effectively consumes HFO at EUR 523 per tonne once the applicable compliance exposure is included.

That distinction matters for voyage estimation but also for charter party drafting, cost pass-through mechanisms, freight negotiations and route planning.

Why the IMO process matters

The broader policy risk is that this type of calculation becomes more common and complex if global regulation does not develop quickly enough.

A global framework would not necessarily remove all national and regional regulation. However, it would reduce the incentive for further fragmentation by providing a common structure, a common direction and a more predictable regulatory baseline. If the IMO process remains delayed or fails to produce a sufficiently accepted framework, individual jurisdictions may be more inclined to introduce or expand their own measures (as we already experience today).

From a national and regional policy perspective, this may be understandable. Governments do not want to wait indefinitely for global alignment. From a shipping perspective, however, the result is difficult to manage. Ships do not operate within one jurisdiction. They move across several regulatory systems, each of which may define scope, emissions, responsible entity and cost differently. The commercial risk is therefore not only that carbon becomes more expensive. It is that carbon becomes more fragmented.

Conclusion

The route from Djibouti to Gabon to Rotterdam to the United Kingdom is a theoretical scenario, but the underlying issue is real. Maritime decarbonisation regulation is becoming increasingly layered. As regional and national regimes expand, the same vessel can accumulate compliance exposure across several regulatory systems within one trading pattern.

In the scenario analysed, the vessel’s fuel cost is EUR 747,000. The combined compliance exposure adds EUR 121,594.50. This increases the effective fuel cost from EUR 450 per tonne to EUR 523 per tonne, representing a 16% increase.

That is the commercial significance of regulatory fragmentation. It does not always appear as one large carbon price. It appears as several separate compliance exposures that accumulate across the voyage. For shipowners, charterers and cargo owners, the relevant question is therefore no longer simply what fuel costs. It is what fuel costs after all applicable carbon regimes have been applied.

If the IMO Net-Zero Framework does not provide a timely and credible global pathway, this question will become increasingly important. The cost of fragmented regulation will not be theoretical. It will be visible in voyage economics and the underlying complexities will cause contractual headaches.