AAL takes the EU ETS Surcharge route
Starting January 1, 2024, European Union regulations on carbon emissions will come into force implementing fixed charges for every ton of CO2 emitted. With everyone looking at potential solutions, it is evident that there will be an increase in costs. Project heavy-lift carrier AAL Shipping (AAL) has issued a carbon surcharge guidance to prepare its customers for the cost rise.
With these additional costs directly attributed to multipurpose cargo operations, AAL has developed what it has termed an EU ETS Surcharge (EUETSS), that will be applied to cargo loaded, or already onboard, an AAL-operated vessel sailing either to or from a European port from 2024.
The EUETSS, which launched in August, will track the current EU Emissions Trading Price as well as average vessel consumption and cargo volume.
AAL will be imposing a charge per Revenue Ton on Part Cargoes that are transported on AAL’s regular trading routes to and from the European continent. This charge will be quoted separately from the normal freight rates. For complete cargoes, AAL will calculate a surcharge based on the estimated or actual voyage emissions.
The EU ETS, the world’s first carbon market, was launched in 2005 to reduce greenhouse gas emissions cost-effectively. Starting from January 1, 2024, all ship operators sailing to or from a European port will be required to monitor and report their emissions. Every ton of CO2 emitted will incur additional charges in the form of purchase allowances surrendered.
“As the industry continues towards greater sustainability and oversight, it is incumbent upon us to ensure that our customers and other supply chain partners remain ahead of the game and kept fully appraised of how changing regulations will impact their cargo movements. AAL will carefully monitor and share any adjustments on a quarterly basis,” said Felix Schoeller, AAL Director and Head of the carrier’s Sustainability Committee.
“The EU ETS is an important step in protecting the environment in which we operate. This surcharge guidance comes on the heels of our latest Sustainability Report in 2022 that we released publicly in August and is our latest initiative in setting a new precedent for greater sustainability across the global multipurpose shipping sector,” he added.