FuelEU Maritime Penalty: How It Is Calculated, With a Worked Example

The EU ETS gets the headlines, but FuelEU Maritime is the regulation that quietly decides what fuel European shipping burns for the next two decades. In force since January 2025, it does not tax emissions — it caps the greenhouse-gas intensity of the energy a ship uses on EU-related voyages, and charges €2,400 per tonne of VLSFO-equivalent energy that misses the cap. Conventional fuels miss it. This article shows exactly how the penalty is computed, with numbers you can check.

#The target, and why every conventional fuel misses it

The regulation set a 2020 baseline of 91.16 grams of CO₂-equivalent per megajoule of energy, measured well-to-wake (production and transport of the fuel included, not just the funnel). From 2025 the fleet average must beat that baseline by 2% — a target of 89.34 gCO₂e/MJ. The reductions step up to 6% in 2030 and keep tightening to 80% by 2050.

The catch: VLSFO comes in around 91.3 gCO₂e/MJ well-to-wake, HFO around 91.6, MGO around 90.6. Burn any of them neat and you run a structural deficit from day one. That is the design — the regulation exists to make blending biofuel, buying e-fuels, or pooling with cleaner ships financially rational.

#The penalty formula

The penalty charges for the energy gap, priced as if that energy were VLSFO. In plain terms: take how far your intensity exceeds the target, multiply by the energy you used in scope, convert that excess into tonnes of VLSFO-equivalent energy (41,000 MJ per tonne), and charge €2,400 per tonne.

compliance deficit (gCO2e) = (actual intensity − target) × energy in scope (MJ)
penalty (EUR) = deficit / (actual intensity × 41,000) × 2,400

#Worked example: Rotterdam to Singapore on VLSFO

Same voyage as our EU ETS worked example: supramax, 12.5 knots, 804 tonnes of VLSFO total (sea + port). The voyage leaves the EU, so 50% of the energy is in scope — about 402 tonnes of fuel, which at 41 MJ/g LCV is roughly 16,480 GJ of energy.

Twenty thousand euros is smaller than the ETS line on the same voyage (≈€96,500), but it accrues on every EU-related voyage, every year, and the target tightens on a schedule while EUA prices at least can fall. Over an annual trading pattern the FuelEU exposure routinely reaches six figures per ship.

#The escape routes: pooling, banking, borrowing

• Pooling: a ship with surplus (say, running on bio-blends or LNG with low slip) can pool its over-compliance with deficit ships — including ships under different owners. A real compliance market has formed around this.
• Banking: surplus earned in one year can be carried forward to the next.
• Borrowing: a ship may borrow a limited advance from next year's compliance, at a 10% premium — rolling deficits two years in a row is restricted.
• Blending: even modest biofuel percentages can close the 2% gap for 2025–2029, which is why B24/B30 demand jumped at bunkering hubs.

All of these are portfolio decisions made across a year — but they start from knowing each voyage's contribution to the deficit while the voyage is still being planned. A desk that sees "this fixture adds €20,700 of FuelEU exposure" can price it, pool it, or blend against it. A desk that discovers the deficit in January pays list price.

#FuelEU and the ETS are different bills

It is worth keeping the two regimes straight: the ETS prices every tonne of CO₂e emitted (tank-to-wake, allowances at market price); FuelEU prices the intensity gap of the energy used (well-to-wake, fixed €2,400/t penalty). A voyage can owe both — our worked supramax owes roughly €96,500 of allowances and carries €20,700 of FuelEU exposure. Both belong in the estimate before fixing, next to bunkers and port costs.