The European Union’s Emissions Trading System (EU ETS) is entering a critical phase as the September 30, 2025, deadline approaches for covered entities to surrender EU Allowances (EUAs) for their 2024 emissions. This marks the first year that maritime transport joins aviation and other sectors under the expanded “polluter pays” scheme, with significant financial and operational implications for the logistics and shipping industries.
The EU ETS, a cornerstone of the EU’s climate policy, now covers approximately 40% of the bloc’s total greenhouse gas emissions. For 2024, maritime transport operators are required to surrender allowances equivalent to 40% of their verified emissions, a figure that will increase in coming years. Expanded aviation routes also fall under the scheme, with most allowances now auctioned rather than allocated for free. This shift reflects the EU’s push to internalize the cost of carbon emissions, compelling industries to either reduce emissions or pay for the right to emit.
The financial stakes are high, particularly for the shipping sector. Industry reports estimate that shipping companies face a collective bill of $2.9 billion in 2025 to comply with the ETS rules. This cost stems from the purchase of EUAs, which are traded in the Union Registry and priced based on market dynamics. Failure to surrender sufficient allowances by the September 30 deadline incurs a steep penalty of €100 per tonne of CO₂ equivalent, alongside public disclosure of non-compliant companies. Such penalties underscore the urgency for maritime and aviation operators to finalize compliance strategies.
Auctioning and Financial Mechanisms
To support the ETS framework, European Commission authorities have scheduled auctions for 50 million additional allowances in 2025. Proceeds from these auctions will fund the Social Climate Fund, designed to mitigate the social impacts of carbon pricing. Revised auction calendars, published in late July 2025, provide clarity on schedules and volumes, with ongoing calls for evidence to refine the process further. Unlike in previous years, when free allowances were more common, the majority of EUAs for maritime and aviation sectors are now sold at auction, aligning with the polluter-pays principle.
For companies, preparation began months ago. By March 31, 2025, all 2024 emissions reports had to be verified and submitted, with data entered into the Union Registry by April 1. Maritime operators were also required to register their Maritime Operator Holding Accounts (MOHAs) to facilitate EUA transactions. Technical guidance from EU authorities has been regularly updated, offering clarity on compliance requirements. However, the complexity of the system, coupled with the financial burden, has prompted intense preparation across the industry.
Industry Response and Challenges
The inclusion of maritime transport in the ETS represents a significant expansion of the scheme’s scope. Ships calling at EU ports must now account for emissions from intra-EU voyages and 50% of emissions from voyages starting or ending outside the EU. This has placed pressure on shipping companies to optimize operations, invest in fuel-efficient technologies, or pass costs onto customers. DNV, a global classification society, has emphasized the need for operators to act swiftly, noting that instalment-based surrendering of EUAs has been available since March 31 but must be finalized by the end of September.
Aviation, already accustomed to the ETS, faces additional challenges with the inclusion of non-EU routes. Operators must navigate a shifting landscape where free allowances are diminishing, and auction prices can fluctuate. Meanwhile, municipal waste incinerators, newly required to report emissions, are not yet obligated to surrender allowances, providing a temporary reprieve as they adapt to the system.
Broader Implications
The EU ETS’s expansion is a bold step toward achieving the EU’s 2030 climate targets, which aim for a 55% reduction in emissions compared to 1990 levels. By placing a tangible cost on carbon, the system incentivizes investment in cleaner technologies and fuels. However, the $2.9 billion cost for shipping alone highlights the economic weight of compliance, particularly for an industry already grappling with volatile fuel prices and global supply chain disruptions.
As the September 30 deadline nears, industry stakeholders are intensifying efforts to ensure compliance. Trade associations, consultancies, and regulatory bodies are actively communicating deadlines and offering support. The coming weeks will test the preparedness of maritime and aviation operators, with the EU ETS setting a precedent for how carbon pricing can reshape global industries.
