In 2015, the European Parliament and the Council adopted Regulation (EU) 2015/757 on monitoring, reporting and verification of carbon dioxide emissions from maritime transport – called as the EU MRV Regulation. Since 1 January 2018, the MRV regulation requires ships of above 5,000 GT to monitor and report their carbon emissions, fuel consumption and other related parameters on all voyages to, from and between EU ports as well as while the vessel is in EU port.
Now, the Directive (EU) 2023/959 - the established EU Emissions Trading System (EU ETS) is extended to maritime transport from January 1, 2024.
The scope of emissions regulated under the MRV scheme is extended to include GHG Emissions namely Methane (CH4) and nitrous oxide (N2O) emissions.

Companies need to amend the monitoring plans reflecting the amendments to include monitoring of CH4 and N2O emissions. By April 1, 2024, companies shall, for each of their ships submit to the administering authority responsible a verified monitoring plan. Concept of Administering Authority is being introduced in the MRV Regulation. List of Administering Authorities is likely to be published by 1st Feb 2024.

From 2025, by March 31 of each year, companies shall, for each ship under their responsibility, submit to the administering authorities and to the Commission a emissions report for the entire reporting period of the previous year, which has been verified as satisfactory by a verifier.

Change of Company: Unlike the current requirement wherein the new Company is responsible for reporting the data for full calendar year, a concept of partial reporting has been introduced. Where there is a Change of Company, the previous company shall submit to the administering authority responsible, to the authorities of the flag States concerned for ships flying the flag of a member State, to the new company and to the Commission, as close as practicable to the day of the completion of the change and no later than three months thereafter, a verified report but limited to the period corresponding to the activities carried out under its responsibility.

Further, a significant amendment is regarding Company level reporting. Companies shall report the aggregated emissions data at the company level and submit such data to the administering authority responsible along with their verified monitoring plans, by March 31 of 2025 and each year thereafter.

From 1 January 2024, CO2 emissions from ships of and above 5 000 gross tonnage, calling at or departing from ports in the European Economic Area (EEA), are included in the EU’s Emissions Trading System (ETS).

The EU Emissions Trading System (ETS) is a ‘cap-and-trade’ system. A cap is a threshold, defining the total amount of greenhouse gases that can be emitted by the operators covered by the system. It is reduced annually, at fixed intervals, in line with the EU’s climate target. The cap is expressed in emission allowances, where one allowance gives the right to emit one tonne of CO2eq (carbon dioxide equivalent). Operators are not allowed to generate more greenhouse gas emissions than their allowances can cover. By 30 September 2025 and each year thereafter, shipping companies are required to surrender the required allowances to the responsible administering authority. The extension of the ETS to maritime transport includes:

• 100% of emissions from ships calling at an EEA port for voyages within the EEA
• 50% of the emissions from voyages starting or ending outside of the EEA
• 100% of emissions produced when ships are within EEA ports.

Extending the scope to other ship types: From January 1, 2025, the EU MRV Regulation will be extended to apply also to offshore ships above 400 GT and general cargo ships between 400 ≤ GT ≤ 5000.
For offshore ships, the definition of "port of call" has been expanded to include ports where the crew is relieved. This means that for offshore ships, a "port of call" now refers to a port where a ship stops to load or unload cargo, embark or disembark passengers, or relieve the crew.