Incorrect emissions data can become costly

Incorrect Emissions Data Can Become Costly (2)

The EU ETS will require more accurate and faster emissions reporting across the value chain.

Those who have ridden the waves in the maritime industry over recent decades will be well-attuned to the increasing emphasis on reducing emissions across the sector. One of the latest systems being implemented to achieve this is the EU Emissions Trading System (ETS), which places a cap on GHG emissions from certain sectors, including shipping, and requires companies to pay tax on their emissions. This means that accurately measuring and reporting emissions data will now become crucial, not only for compliance but also for correct payment towards the EU ETS. Above all else, it will hold industry players accountable to demonstrate a genuine commitment to sustainability.

“Over the last years, we have witnessed a surging need within the industry to have accurate emissions data that the whole value-chain can trust in,” says Magnus Lande, Product Line Director for the Veracity by DNV data platform. “What was once a superficial matter of branding is today a business need and a legitimate license to get investors and customers onboard with correct legislative reporting.”

The EU ETS in practise

In 2019, the Poseidon Principles framework was created to encourage green financing in lenders’ shipping portfolios. Since then, Sea Cargo Charter and other industry-wide initiatives have followed suite, making it more difficult to be competitive without a commitment to reducing emissions and accurate reporting. With the EU ETS, the game is gearing up. From 2024, cargo and passenger ships above 5000 GT will be required to pay allowances for 40% of their emissions. The year after, the percentage increases to 70%, and in 2026 they are expected to pay full coverage. Also, from 2026, the system will include methane and nitrous oxide, in addition to CO2, and in 2027 offshore ships above 5 000 GT will be added. The calculations will be based on all emissions generated from voyages within the EU/EEA and 50% of the emissions on voyages that come in and out of the EU/EEA. What’s more, container vessels that are stopping in transshipment ports outside the EU/EEA but less than 300 nm from an EU/EEA port need to include 50% of the emissions for the voyage to that port as well.

Seamless dataflow and real-time emissions verification

“The EU ETS is not only driving the need for more accurate, but faster reporting. This is something that we in DNV are well-equipped to help customers comply with,” says Magnus. “Over the last year, we have quickly grown a partner program around our maritime industry platform Veracity. Today, we have many of the major operational vessel data providers partnering with us and integrating with Veracity, allowing an automated and seamless flow of data from the vessel through to DNV’s trusted now real-time emission verification services.”

“What’s more, we want our customers to be able to make the most out of the high-quality data that they sit on after the verification process is completed. By utilizing the secure storing and sharing mechanisms in the Veracity Data Workbench, our customers can start combining their verified data with other data sets and utilize it in new use cases, creating a fast track to innovation.”

Trusted data opens new opportunities

While the drive towards accurate and reliable emissions data is being steered by the need to comply with more stringent legislation, having access to the high-quality, trusted data will also create new opportunities for shipowners. This will allow them to identify areas where emissions can be reduced, potentially leading to significant cost savings and environmental benefits. Finally, reporting high-quality emissions data can help to improve the industry’s reputation and demonstrate a commitment to sustainability, attracting customers, investors, and other stakeholders.