Maersk: emissions surcharge. File Image / Pixabay.
Box shipping giant Maersk has given an indication of what the cost of the European Union's ETS will be to maritime trade.
Under the EU scheme, an EU Allowance (EUA) is equivalent to a metric tonne of reported carbon dioxide. Shipping companies will be able to buy allowances via exchanges or over-the-counter.
Maersk will apply the extra cost via an emissions surcharge, according to senior product manager for energy products at Maersk Ratish Rajan. Rajan believes that the market for EUAs may be subject to volatility.
European Union Allowance notional price, EUR 90.
"The volatility of the EUA traded in ETS may increase due to supply and demand factors," the executive said in a post on the company website. In response, Maersk will give quarterly updates to align with the changes in EUA using a public index for the EUA price, he added.
Among the estimated emissions surcharges (per dry forty-foot equivalent container) given in the post are EUR 45 for intra-Mediterranean trade, EUR 22 for intra north Europe trade and EUR 44 for north Europe to the Mediterranean routes.
Prices are based on a notional going rate for an EUA of EUR 90. Actual surcharge prices will be given at least thirty days prior to them going live, Rajan said.
The ETS is a regional move by the EU to curtail CO2 emissions from ships. It will be introduced to the market gradually starting from 2024.