From January, the offshore sector will come under the remit of the European Union’s Monitoring, Reporting, and Verification (EU-MRV) scheme. EU-MRV aims to assess the environmental impact of maritime transport using collected and reported emissions data. It also provides the basis for determining carbon taxes for subsequent regulations, including the EU Emissions Trading Scheme (EU ETS) and FuelEU Maritime.
Initially, the scheme applied to ships above 5,000 GT undertaking any voyage within, to, or from the EU. However, from January 1, an update to the regulation will also apply to general cargo ships between 400 and 5,000 GT and offshore vessels of 400 GT and above.
The amendment to include offshore ships above 400 GT within the EU-MRV regulation was confirmed in October 2024. This begins a process that will eventually include the offshore sector in the EU carbon trading system (EU ETS). However, only cargo and passenger ships over 5,000 GT are currently included in the EU ETS scope. The next step will be introducing offshore ships above 5,000 GT on January 1, 2027. Offshore ships between 400 and 5,000 GT will be reviewed before the end of December 2026 for later inclusion.
The EU ETS requires ship owners to pay for their emissions. Under the scheme, companies must purchase and surrender EU emission allowances (EUA) for each tonne of reported CO2 emissions within its scope. The EU and its member states will use the revenue generated by the scheme to invest in green maritime technologies and incentivize improvements in energy efficiency and low-carbon solutions. The scheme is also anticipated to help the industry reduce the price difference between alternative and traditional maritime fuels.
Here, we examine how EU-MRV will impact the offshore sector when it comes into force in less than two months, with a look ahead to the EU-ETS.
For more on EU MRV for the shipping sector, read: Keeping pace with the EU's emission reduction regulations? Spinergie's Smart Fleet Management solution holds the answers
The offshore sector: a diverse range of vessels and activities
The offshore vessel market is complex and diverse, with over 11,000 vessels across over 20 sub-categories. These vessel categories range from crew transfer to heavy-lift, pipe-laying to geophysical survey specialists, and wreck removals - the scope of activities is vast. Most offshore vessels (70%) support oil and gas operations, and 11% support offshore wind projects. The largest category is the support fleet, which includes supply vessels, anchor handlers, SOVs, and AHTs, accounting for over 60% of the total fleet.
Despite the fleet's various operations, their activities can be grouped into four primary modes: ashore, underway, on-site, and standby. It should also be noted that DP-capable vessels enable more precise operations characterization.
The updated EU-MRV regulation will affect around 8,000 offshore vessels from January 1, with around 18% currently located in Northern Europe and the Mediterranean. Compliance with the regulation is a top priority for many vessel owners, as non-compliance is punishable by high penalties.
How will the EU-MRV and EU-ETS regulations apply to the offshore market?
One key objective of the EU-MRV regulation is to clarify the terms “offshore ships" and “voyage” and ensure their uniform application in the offshore industry. Unlike traditional shipping vessels, offshore ships are designed for installation or support work rather than transporting cargo or passengers for commercial purposes.
The delegated act announced in October includes a comprehensive list of vessel types, ranging from crew and supply vessels to FPSOs, reflecting the broad scope of the offshore industry. This classification aligns with the offshore sector, dredging, and other activities within the IMO’s StatCode 5 coding system.
The regulation also refines the definition of port calls for offshore operations. GHG emissions from offshore ships are to be measured during the following types of voyages:
- From the last port of call to a port under the jurisdiction of a member state.
- From a port under the jurisdiction of a member state to the next port of call.
- Between ports under the jurisdiction of a member state.
However, the definition of a port of call for offshore vessels requires additional precision. For these ships, a port of call is where a vessel stops to load or unload cargo, embark or disembark passengers, or relieve crew. Additionally, offshore facilities (such as FPSOs or platforms) with an assigned UN/LOCODE identifier are considered ports. Specific stops are explicitly excluded from being classified as a port of call, such as:
- Stops solely for refuelling, obtaining supplies (e.g., fodder for vessels transporting animals), or relieving crew of non-offshore vessels.
- Stops for repairs, dry-docking, or vessel/equipment maintenance.
- Stops due to assistance needs, distress, or adverse weather conditions.
- Ship-to-ship transfers conducted outside of ports.
- Stops for search and rescue activities.
- Stops at container transshipment ports as identified in Implementing Regulation (EU) 2023/2297.
This detailed framework ensures that emissions tracking and compliance are aligned with the unique operational profiles of offshore vessels.
Ensuring regulatory compliance
The EU-MRV regulation has three primary obligations that companies must meet to comply.
Monitoring: All offshore ships must have a monitoring plan with the registered owner responsible. The plan must be sent to an accredited MRV verifier before the reporting period begins on January 1, 2025.
Emissions Report: Companies must submit a verified emissions report via the THETIS MRV system by 30 April each year.
Document of Compliance: All vessels must have a document of compliance issued by THETIS MRV. This requirement may be subject to inspections by individual member state authorities.
The regulatory milestones for EU-MRV are as follows:
- Without undue delay: MRV Plan to be submitted to a Verifier
- April 2025: MRV Plan to be submitted to Authorities (EU/state), incl. verifier name
- Jan 2026: 2025 Emissions data should be submitted to Verifier for Quality Checks
- Mar 2026: 2025 Emissions data verified should be submitted to Authorities
If a company fails to comply with the EU-MRV regulation, the authorities will consider the worst-case scenario of the vessel, i.e., the highest emissions data based on vessel type for the time without correct values). Direct sanctions have not yet been defined, but we can anticipate financial penalties and sail restrictions within Europe.
In a longer view, non-compliance penalties will be extensive when EU-ETS comes into force. Companies that fail to surrender allowances are liable to an excess emissions penalty of €100 (corrected for inflation) per tonne of CO2 equivalent while still being liable for the required allowances. Companies that are penalized will be named publicly, directly affecting their competitiveness in the marketplace.
Furthermore, an expulsion order may be placed if a company fails to comply for two or more consecutive reporting periods. In practice, this would mean that every EU member state must refuse the ship entry to its ports until the company fulfills its obligations. A non-compliant ship entering a port may be detained until obligations are fulfilled.
Read More: Spinergie and Veracity by DNV strategic partnership enhances emissions reporting
The introduction of the EU-MRV regulation to the offshore sector marks a significant shift in how emissions are monitored and reported. Unlike shipping, which has been under EU-MRV regulations since 2015, the offshore industry faces unique challenges due to its diversity of vessel types, operations, and activities. Adapting to these regulations will require a steep learning curve, meticulous preparation, and investment in systems that meet stringent monitoring, reporting, and compliance requirements.
In our upcoming webinar, ‘The cost of GHG regulations on offshore operations: how to navigate EU MRV and EU ETS,’ we will discuss the upcoming regulations in detail. Our experts will discuss regulatory impact and how the sector's diverse activities create challenges for regulatory implementation. Then, they will explore how best to monitor, report, verify, and optimize to stay on track and how regulatory emission modeling helps measure the cost impact of the ETS. Click here to Register Now.
%20(2).jpg)
.jpg)
%20(1).jpg)