COSCO Shipping Lines (COSCO) has announced its EU Emissions Trading System (ETS) fuel surcharge estimates six weeks before the new regulation is set to take effect.

Starting January 1, 2024, all shipping vessels will be required to disclose the amount of carbon they emit for routes to and from Europe. After that, they will be obliged to purchase EUAs (European Union Allowances) that correspond to their carbon emissions from the previous year.

Initially, this requirement will apply to only 40% of their emissions, rising to 70% the year after and 100% in 2026.

"To fully comply with the latest requirement set by the EU, COSCO SHIPPING LINES has to implement the ETS surcharge effective from January 1, 2024, for which we would like to seek your kind understanding and continuous cooperation," COSCO said of the impending charges.

Under the new law, shipping companies are obligated to purchase allowances for the following emissions: 50% of emissions from voyages departing from an EU port to a non-EU port and vice versa; 100% of emissions from voyages between EU ports; and 100% of emissions from ships docked at an EU port.

COSCO's EU ETS charges fall on the higher end of recently announced tariffs to be levied by other shipping lines.

For Asia-North West Europe, the Chinese carrier will charge €28/TEU and €42/TEU for reefer. It will collect €19/TEU for North West Europe-Asia and €29/reefer TEU.

The carrier will charge NAM East Coast to North West Europe €27/TEU for dry container and €41/TEU reefer, among others.

 [Source: COSCO Shipping Lines]

It noted that the surcharge tariff assumption in case 40% of the reporting CO2 will be charged.

"The surcharge amount will be reviewed on a monthly basis, depending on the updated version of the EU ETS regulation and the market value of carbon allowances.

Earlier this month, Evergreen also announced its EU ETS charges following Maersk, CMA CGM, MSC, Hapag- Lloyd and ONE in its indications of forthcoming surcharges to cover the EU ETS.