Overview of EUA Market 2024-2027

MBIEC forecast model linking projected shipping EUA demand with carbon prices and associated compliance costs from 2024 through 2027.

🔍 Key Summary

1. EUA Demand Growth

• 2024: ~112 MtCO₂ (40% compliance).

• 2025: Big jump to ~200 MtCO₂.

• 2026–2027: Stabilizes near 290–300 MtCO₂ under 100% coverage.

2. Compliance Cost Pressure

• With EUA prices expected to rise toward 2026–2027:

  • 2024 Base Case: €7.3 bn

  • 2026 Base Case: €23.4 bn

  • 2027 High Case: nearly €36 bn (if EUA prices spike to €120/t)

3. Strategic Implications

• Fuel-saving measures will directly cut EUA obligations.

• Charter contracts must clarify EUA cost pass-through.

• Active EUA procurement strategy is crucial—especially in 2025 and 2026.

  
  

Forecast Shipping EUA Demand and Cost under Price Scenarios

📊 Forecast Summary Table

Year	Fuel Demand (Mt)	CO₂ Emissions (Mt)	Surrender Obligation (%)	EUA Demand (Mt)	Low Cost (€bn)	Base Cost (€bn)	High Cost (€bn)
2024	90	279.90	40%	111.96	€6.72	€7.28	€7.84
2025	92	286.12	70%	200.28	€13.02	€14.02	€16.02
2026	94	292.34	100%	292.34	€20.46	€23.39	€29.23
2027	96	298.56	100%	298.56	€22.39	€26.87	€35.83

📚 SOURCES & REFERENCES

1. EU ETS & Maritime Regulation

• EU MRV Regulation & ETS Expansion (Directive 2003/87/EC, amended):

  • CO₂ emissions from maritime transport (vessels ≥5,000 GT) included from January 1, 2024.

  • Surrender timeline:

    • 2024 emissions → 40% obligation (surrender by 30 Sept 2025).

    • 2025 → 70%, 2026 onward → 100%.

  • Source: European Commission – EU ETS for shipping

2. Carbon Pricing Estimates

• Carbon market spot and futures pricing data for 2024 from:

  • ICE EU ETS Futures Pricing

  • Reuters Carbon Market Coverage

• Scenario assumptions:

  • Low: €60–75/tCO₂

  • Base: €65–90/tCO₂

  • High: €70–120/tCO₂

  • These reflect recent market trends and analyst forecasts through 2025–2027.

3. Marine Fuel Consumption Estimates

• EU bunker fuel consumption:

  • Estimated at ~90 million tonnes/year for vessels calling at EU ports.

  • Assumes ~30% of global marine fuel demand (based on Clarksons and IEA data).

  • Source:

    • IEA – Marine Fuel Statistics

    • [Clarksons Research – Shipping & Emissions Outlook]

    • DNV Maritime Forecast Reports

4. CO₂ Emission Factors

• Conversion: 1 tonne of marine fuel ≈ 3.11 tonnes of CO₂

  • Based on average carbon content of Heavy Fuel Oil (HFO) and Marine Gas Oil (MGO).

  • Source: IMO 4th GHG Study, EU MRV Guidelines.

5. EUA Demand Forecast

• Derived by applying surrender percentages to estimated EU-applicable CO₂ emissions:

  • 2024: 40% × ~280 MtCO₂ = ~112 Mt EUA

  • 2025: 70% × ~286 MtCO₂ = ~200 Mt EUA

  • 2026–27: 100% × ~292–298 MtCO₂

• Verified against EC’s preliminary estimates for maritime inclusion.

🔍 Methodology Notes

• Model assumes gradual increase in marine fuel use (1–2% YoY) due to fleet growth and trading activity.

• Does not account for:

  • Fuel switching (e.g. LNG, methanol)

  • Voluntary offsets

  • EUA banking or hedging strategies

• Designed for compliance cost projection, not lifecycle decarbonization.

Maverick Business Intelligence & Energy Company