Expect Fuel Costs to Rise, Says Ship Tech Executive

by Ship & Bunker News Team
Tuesday November 14, 2023

The price of fuel and the cost of regulatory compliance for greenhouse gas emissions are likely going to rise, a senior marine technology executive has said.

In some cases the cost of European Union Allowances (EUA) -- carbon credits under the the EU's emissions trading scheme -- could account for 50% of the cost of fuel, head of sustainability at Yara Marine Technologies, Aleksander Askelanda, told price reporting agency S&P Global Commodity Insights.

"Shipowners should be making every effort to reduce their exposure to variable costs for bunkers and carbon credits and invest in technologies that can reduce both, fuel costs and emissions, over the lifetime of the vessel," according to Askeland.

Smaller firms with limited resources would be vulnerable to price pressure but partnering with specialist firms could lessen the burden, he added.

"It would make sense for smaller companies to work with external service providers (such as classification societies) who specialize in the areas such as measuring and reporting in order to keep the overall cost of compliance low."

According to Platts, the price of an EUA averaged EUR 81.17 per metric tonne of CO2e in 2022. EUA contracts for December delivery were assessed at EUR 78.70/mtCO2e on November 10.