Does It Count? Regulation and the Economics

7 min read

What you'll take away Map where captured CO2 is and is not credited under EU ETS, FuelEU Maritime and the IMO instruments, and reason through when the economics of capture close.

Four lessons of engineering come down to a bookkeeping question. Carbon regulation charges ships for emitting CO2; a capture plant removes CO2 before it is emitted. Whether the first fact notices the second, whether a captured tonne is a credited tonne, decides if everything you have read so far is an investment or an expensive gesture.

Three instruments, one blind spot

The clearest open treatment of this question is a ClassNK Technical Journal article, Treatment and Issues of Onboard CO2 Capture and Storage/Utilization under GHG Regulations, which walks instrument by instrument. The pattern it finds is consistent: the principle of crediting is accepted more readily than the accounting is written.

EU ETS. The emissions trading system is where credit is closest. The directive already exempts CO2 that is captured and delivered to permanent storage from the obligation to surrender allowances, and the Commission's guidance for shipping companies (Guidance document No. 1, section 5.2.3, updated version of 18 November 2025) sets out the basis. What counts is not the amount captured but the amount handed over to a CO2 transport operator or storage site, so the ship's own tank capacity can cap the deduction; the storage must be a site permitted under the EU's CCS Directive, in EU or EEA territory; and utilisation counts only where the CO2 is permanently bound as mineral carbonates in construction products under Delegated Regulation 2024/2620, never as a fuel. The extra fuel the plant burns goes into the monitoring plan and onto the bill. The guidance calls itself preliminary, because the general CCS and CCU rules are being updated, and the still-open part is the chain-of-custody detail and verifier practice for the shipboard case, from the ship's tank through the offload chain of lesson 4. In July 2026 the Global Centre for Maritime Decarbonisation reported a shipboard case, its Project CAPTURED pilot, whose tonnes were mineralised ashore and recognised for deduction. Until an operator can evidence that chain, the tonnes stay on the bill.

FuelEU Maritime. Here the obstacle is structural. FuelEU regulates the well-to-wake greenhouse-gas intensity of the energy used on board: a property of the fuel, computed from the fuel. A capture plant working downstream of the engine sits outside that formula entirely, however well it performs. Crediting capture under FuelEU requires amending the method itself, and the regulation's own review machinery is where that question lives: Article 30 asks the Commission to consider it in the report due by the end of 2027.

The IMO instruments. The DCS collects fuel consumption; the CII converts it to CO2 with a carbon factor per tonne of fuel. Neither looks at the exhaust, so neither can see what was removed from it: a ship capturing 75% of her emissions reports exactly the same figures as her sister venting everything. Where the IMO credit is being designed is the life-cycle route. The 2024 LCA Guidelines already carry a deduction term for onboard captured CO2, with the method left unspecified; MEPC 83 (April 2025) approved a work plan for a regulatory framework for onboard capture; and MEPC 84 (April to May 2026) agreed that capture should be counted at ship level in the fuel-intensity guidelines under the Net-Zero Framework, re-established the correspondence group to report to MEPC 86 in 2027, and planned completion for 2028. None of it is adopted: the Net-Zero Framework itself was not adopted when its adoption session adjourned in October 2025, and a method under development is not a subtraction an owner can book.

Note the asymmetry with lesson 4: regulation is likeliest to credit permanent storage, while utilisation, the destination with the readiest commercial buyers, may return the carbon to the air and earns correspondingly harder questions.

Where a captured tonne is, and is not, credited Instrument What the rule counts Does a captured tonne count today? EU ETS FuelEU Maritime IMO DCS and CII IMO life-cycle route (Net-Zero Framework) Allowances surrendered on the CO2 the ship emits Well-to-wake GHG intensity of the energy used on board Fuel consumed × a carbon factor per tonne of fuel Life-cycle GHG intensity of the fuel, with a deduction term for captured CO2 Closest: yes in principle basis set out in Commission guidance; chain-of-custody detail still open Not as written the formula is a property of the fuel, not of the exhaust Not as written a capturing ship reports the same figures as one venting everything Designed, not adopted deduction term in place; the method is due in 2028
The three instruments in force compute emissions from something the capture plant never touches: allowances on emitted CO2, the intensity of the fuel, bunkers times a carbon factor. Only under the ETS are the principle and the basis of the deduction written; the IMO's life-cycle route, where a deduction term exists but no method yet, is still being built.

The economics, on one page

Strip the business case to two numbers per tonne.

The cost side: amortisation of lesson 3's capex, recall the study range of 26–70% of newbuild cost, around 40% on average, plus the energy-penalty fuel from lesson 2, plus offload, shipping and storage fees along lesson 4's chain.

The value side: what a credited tonne is worth. Under the ETS that is the allowance price: a ship capturing and delivering 10,000 tonnes a year, fully credited at 80 euros per tonne, saves 800,000 euros a year. Add whatever a FuelEU amendment might one day make a captured tonne worth, and weigh the same tonnage against a compliant-fuel premium measured in hundreds of euros per tonne of fuel.

If cost per tonne exceeds value per tonne, capture is philanthropy. The Maersk Mc-Kinney Moller Center's study expected amine capture to be commercially available around 2030 and saw a role for it from then as a bridging technology, but its own abatement cost for the best case, USD 220–290 per tonne of CO2 avoided well-to-wake, shows how far the value side must rise, through carbon prices, corridors and crediting rules, before the case closes. Treat the year as a scenario, not a promise, but treat the structure of the argument as sound.

When OCC makes sense

The profile that emerges from this course: a large, young ship, committed to conventional fuel for years yet; a fixed trade touching ports with a credible path to CO2 reception; and a management prepared to bet that crediting rules will mature within the investment's life. Miss the ship, the trade or the rule, and waiting, perhaps as capture-ready tonnage, is the defensible choice. Our free course Maritime Regulations, Explained covers the ETS and FuelEU machinery this lesson leaned on; watch three things as they evolve: the accounting rules, the corridor projects, and the cost per delivered tonne. The day all three line up, this stops being a debate and becomes a procurement decision.

Check yourself

1. Under the IMO's DCS and CII as written, how is captured CO2 treated?
2. Under the Commission's ETS guidance for shipping companies, which quantity of captured CO2 may a ship deduct?
3. Why does FuelEU Maritime, as written, offer no credit for onboard capture?
4. Which costs belong on the per-tonne cost side of the capture ledger?
5. What did the MMMCZCS study conclude about commercial readiness?
6. For capture to pay on a given ship, which conditions must hold?

Select all that apply.

7. Fitting a capture plant automatically reduces a ship's EU ETS liability.
8. A ship captures and delivers 10,000 tonnes of CO2 in a year, all of it credited at an allowance price of 80 euros per tonne. What is the credit worth for the year, in euros? Enter a plain number, no thousands separators.
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