Evolving container shipping emissions regulations driving up costs

The container shipping industry is dealing with rising additional costs as regulatory environmental frameworks tighten in both the EU and the UK.

With the European Emissions Trading System (EU ETS) now demanding greater coverage of carbon emissions, and the UK set to launch its own equivalent in 2026, the sector is bracing for higher surcharges and operational shifts.

The EU ETS, introduced for the maritime sector in 2024, now covers a larger share of emissions, requiring shipping companies to purchase allowances for 70% of their CO2 output—an increase from 40% previously. This applies to half of the emissions from voyages starting or ending in the EU and the full emissions from intra-EU journeys. As a result, shippers have seen emissions-related surcharges on major trade lanes double in early 2025.

While bunker fuel costs are projected to decline in the coming year, the increase in regulatory expenses will more than offset these savings, pushing up overall fuel bills for European routes. Shipping lines have responded by raising surcharges, with some increasing by over 100%. The cost of carbon allowances has fallen in 2025 compared to the previous year, easing some financial pressure, but the increased percentage of emissions covered under the system means shippers will still pay significantly more than before.

Contractual and operational changes
Beyond direct cost increases, the volatility of carbon allowance prices introduces uncertainty in financial planning. Contract terms also evolving, as the responsibility for emissions-related costs is negotiated, while operational adjustments such as optimising routes, reducing vessel speeds, and investing in cleaner technologies to minimise emissions are also being explored.

UK prepares to launch its own ETS
The UK will extend its Emissions Trading Scheme (UK ETS) to cover maritime emissions from 2026. Unlike the EU system, which applies to partial emissions on international voyages, the UK ETS will cover all emissions from voyages starting or ending in a UK port, as well as those generated while berthed.

Although the full details are still emerging, compliance obligations will take effect from January 2026, and shipping companies will face full cost exposure immediately. The UK ETS is expected to impose higher taxes on more carbon-intensive fuels and progressively lower emissions caps in the coming years, increasing the financial burden on carriers and, by extension, shippers.

Outlook
While the immediate costs of compliance remain a small fraction of overall shipping expenses, the financial burden will become more pronounced as regulations tighten further and freight rates fluctuate. Fixed emissions-related surcharges could represent a growing share of overall costs, particularly when freight rates decline from current elevated levels.

Your emission expert partner
As container shipping adapts to evolving EU and UK emission compliance and costs, Noatum Logistics’ environmental and industry expertise ensures your business optimises service and costs, while enhancing your sustainability credentials.

Get in touch with our ocean team today and discover how we can optimise your supply chain for the future.

With over 90 offices in 25 countries, we deliver end-to-end logistics support and seamless communication from origin to destination. Our secure and adaptable ocean freight solutions help shippers meet the challenges of a shifting market.

Through our N-CAP Carbon Control Programme, we offer emission forecasting, global monitoring, and offsetting solutions, while our PowerView platform systematically tracks and reports CO₂ impact across all transport modes, supporting brands in making data-driven sustainability decisions.