Legal provisions of COM(2021)562 - Use of renewable and low-carbon fuels in maritime transport

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dossier COM(2021)562 - Use of renewable and low-carbon fuels in maritime transport.
document COM(2021)562 EN
date September 13, 2023


CHAPTER I

GENERAL PROVISIONS

Contents

Article 1 - Objective and purpose

This Regulation lays down uniform rules imposing:

(a) the limit on the greenhouse gas (‘GHG’) intensity of energy used on-board by a ship arriving at, staying within or departing from ports under the jurisdiction of a Member State and

(b) the obligation to use on-shore power supply or zero-emission technology in ports under the jurisdiction of a Member State,

in order to increase consistent use of renewable and low-carbon fuels and substitute sources of energy across the Union, while ensuring the smooth operation of maritime traffic and avoiding distortions in the internal market.

Article 2 - Scope

This Regulation applies to all ships above a gross tonnage of 5000, regardless of their flag in respect to:

(a) the energy used during their stay within a port of call under the jurisdiction of a Member State,

(b) the entirety of the energy used on voyages from a port of call under the jurisdiction of a Member State to a port of call under the jurisdiction of a Member State, and

(c) a half of the energy used on voyages departing from or arriving to a port of call under the jurisdiction of a Member State, where the last or the next port of call is under the jurisdiction of a third country.

This Regulation does not apply to warships, naval auxiliaries, fish-catching or fish-processing ships, wooden ships of a primitive build, ships not propelled by mechanical means, or government ships used for non-commercial purposes.

Article 3 - Definitions

For the purposes of this Regulation, the following definitions apply:

(a)‘greenhouse gas emissions’ means the release of carbon dioxide (CO2), methane (CH4) and nitrous oxides (N2O) into the atmosphere;

(b)‘biofuels’ means biofuels as defined in Article 2, point (33), of Directive (EU) 2018/2001;

(c)‘biogas’ means biogas as defined in Article 2, point (28), of Directive (EU) 2018/2001;

(d)‘recycled carbon fuels’ means recycled carbon fuels as defined in Article 2, point (35), of Directive (EU) 2018/2001;

(e)‘renewable fuels of non-biological origin’ means renewable fuels of non-biological origin as defined in Article 2, point (36), of Directive (EU) 2018/2001;

(f)‘food and feed crops’ means food and feed crops as defined in Article 2, point (40), of Directive (EU) 2018/2001;

(g)‘zero-emission technology’ means a technology fulfilling the requirements of Annex III that does not imply the release of the following greenhouse gases and air pollutants into the atmosphere by ships: carbon dioxide (CO2), methane (CH4), nitrous oxides (N2O), sulphur oxides (SOx), nitrogen oxides (NOx) and particulate matter (PM);

(h)‘substitute sources of energy’ means renewable wind or solar energy generated on-board or electricity supplied from on-shore power supply;

(i)‘port of call’ means a port of call as defined in Article 3, poin (b) of Regulation (EU) 2015/757;

(j)‘voyage’ means voyage as defined in Article 3, point (c) of Regulation (EU) 2015/757;

(k)‘company’ means company as defined in Article 3, point (d) of Regulation (EU) 2015/757;

(l)‘gross tonnage’ (GT) means GT as defined in Article 3, point (e) of Regulation (EU) 2015/757;

(m)‘ship at berth’ means ship at berth as defined in Article 3, point (n) of Regulation (EU) 2015/757;

(n)‘energy use on-board’ means the amount of energy, expressed in mega joules (MJ), used by a ship for propulsion and for the operation of any on-board equipment, at sea or at berth;

(o)‘greenhouse gas intensity of the energy used on-board’ means the amount of greenhouse gas emissions, expressed in grams of CO2 equivalent established on a well-to-wake basis, per MJ of energy used on-board;

(p)‘well-to-wake’ means a method for calculating emissions that takes into account the greenhouse gas impact of energy production, transport, distribution and use on-board, including during combustion;

(q)‘emission factor’ means the average emission rate of a greenhouse gas relative to the activity data of a source stream, assuming complete oxidation for combustion and complete conversion for all other chemical reactions;

(r)‘on-shore power supply’ means the system to supply electricity to ships at berth, at low or high voltage, alternate or direct current, including ship side and shore side installations, when feeding directly the ship main distribution switchboard for powering hotel, service workloads or charging secondary batteries;

(s)‘verifier’ means a legal entity carrying out verification activities, which is accredited by a national accreditation body pursuant to Regulation (EC) No 765/2008 and this Regulation;

(t)‘reporting period’ means reporting period as defined in Article 3, point (m) of Regulation (EU) 2015/757;

(u)‘FuelEU certificate of compliance’ means a certificate specific to a ship, issued to a company by a verifier, which confirms that that ship has complied with this Regulation for a specific reporting period;

(v)‘passenger ship’ means a ship that carries more than 12 passengers, including cruise ships, high speed passenger crafts, and ships with facilities to enable road or rail vehicles to roll on and roll off the vessel;

(w)‘containership’ means a ship designed exclusively for the carriage of containers in holds and on deck;

(x)‘non-compliant port call’ means a port call of during which the ship does not comply with the requirement of Article 5(1), and none of the exceptions provided for in Article 5(3) apply;

(y)‘least favourable pathway’ means the most carbon-intensive production pathway used for any given fuel;

(z)‘CO2 equivalent’ means the metric measure used to compute the emissions from CO2, CH4 and N2Oon the basis of their global-warming potential, by converting amounts of CH4 and N2O to the equivalent amount of carbon dioxide with the same global warming potential;

(aa)‘compliance balance’ means the measure of a ship’s over- or under-compliance with regards to the limits to the yearly average greenhouse gas intensity of the energy used on-board by a ship, which is calculated in accordance with Annex V.

(bb)‘compliance surplus’ means a compliance balance with a positive value.

(cc)‘compliance deficit’ means a compliance balance with a negative value;

(dd)‘total pool compliance balance’ means the sum of the compliance balances of all ships included in the pool.

(ee)‘managing body of the port’ means any public or private body as defined in Article 2(5) of Regulation (EU) 2017/352 of the European Parliament and of the Council 28 .

CHAPTER II

REQUIREMENTS ON ENERGY USED ON-BOARD BY SHIPS

Article 4 - Greenhouse gas intensity limit of energy used on-board by a ship

1. The yearly average greenhouse gas intensity of the energy used on-board by a ship during a reporting period shall not exceed the limit set out in paragraph 2.

2. The limit referred to in paragraph 1 shall be calculated by reducing the reference value of [X grams of CO2 equivalent per MJ]* by the following percentage: 

–-2% from 1 January 2025;

–-6% from 1 January 2030;

–-13% from 1 January 2035;

–-26% from 1 January 2040;

–-59% from 1 January 2045;

–-75% from 1 January 2050.

[Asterix: The reference value, which calculation will be carried out at a later stage of the legislative procedure, corresponds to the fleet average greenhouse gas intensity of the energy used on-board by ships in 2020 determined on the basis data monitored and reported in the framework of Regulation (EU) 2015/757 and using the methodology and default values laid down in Annex I to that Regulation.]

3. The greenhouse gas intensity of the energy used on-board by a ship shall be calculated as the amount of greenhouse gas emissions per unit of energy according to the methodology specified in Annex I.

4. The Commission is empowered to adopt delegated acts in accordance with Article 26 to amend Annex II in order to include the well-to-wake emission factors related to any new sources of energy or to adapt the existing emission factors to ensure consistency with future international standards or the legislation of the Union in the field of energy.

Article 5 - Additional zero-emission requirements of energy used at berth

1. From 1 January 2030, a ship at berth in a port of call under the jurisdiction of a Member State shall connect to on-shore power supply and use it for all energy needs while at berth.

2. Paragraph 1 shall apply to:

(a)containerships;

(b)passenger ships.

3. Paragraph 1 shall not apply to ships:

(a)that are at berth for less than two hours, calculated on the basis of hour of departure and arrival monitored in accordance with Article 14;

(b)that use zero-emission technologies, as specified in Annex III;

(c)that have to make an unscheduled port call for reasons of safety or saving life at sea;

(d)that are unable to connect to on-shore power supply due to unavailable connection points in a port;

(e)that are unable to connect to on-shore power supply because the shore installation at the port is not compatible with the on-board on-shore power equipment;

(f)which, for a limited period of time, require the use of on-board energy generation, under emergency situations representing immediate risk to life, the ship, the environment or for other reasons of force majeure.

4. The Commission is empowered to adopt delegated acts in accordance with Article 26 to amend Annex III in order to insert references to new technologies in the list of applicable zero-emission technologies or criteria for their use, where these new technologies are found equivalent to the technologies listed in that Annex in the light of scientific and technical progress.

5. The managing body of the port of call shall determine whether the exceptions set in paragraph 3 apply and issue or refuse to issue the certificate in accordance with the requirements set out in Annex IV.

6. From 1 January 2035, the exceptions listed in paragraph 3, points (d) and (e), may not be applied to a given ship, in total, more than five times during one reporting year. A port call shall not be counted for the purpose of compliance with this provision where the company demonstrates that it could not have reasonably known that the ship will be unable to connect for reasons referred to in paragraph 3, points (d) and (e).

7. Emergency situations resulting in the need to use on-board generators, referred to in paragraph 3, point (f), shall be documented and reported by the ship to the managing body of the port.

CHAPTER III

COMMON PRINCIPLES AND CERTIFICATION

Article 6 - Common principles for monitoring and reporting

1. In accordance with Articles 7 to 9, companies shall, for each of their ships, monitor and report on the relevant data during a reporting period. They shall carry out that monitoring and reporting within all ports under the jurisdiction of a Member State and for any voyages to or from a port under the jurisdiction of a Member State.

2. Monitoring and reporting shall be complete and cover the energy used on-board by ships, while the ships are at sea as well as at berth. Companies shall apply appropriate measures to prevent any data gaps within the reporting period.

3. Monitoring and reporting shall be consistent and comparable over time. To that end, companies shall use the same monitoring methodologies and data sets subject to modifications assessed by the verifier. Companies shall enable reasonable assurance of the integrity of the data to be monitored and reported.

4. Companies shall obtain, record, compile, analyse and document monitoring data, including assumptions, references, emission factors and activity data, in a transparent and accurate manner, so that the verifier can determine the greenhouse gas intensity of the energy used on-board by ships.

5. In undertaking the monitoring and reporting activities set out in Articles 7 to 9 and 14 of this Regulation, information and data collected for the purpose of Regulation (EU) 2015/757 shall be used where appropriate.

Article 7 - Monitoring plan

1. By 31 August 2024, companies shall submit to the verifiers a monitoring plan for each of their ships indicating the method chosen from among those set out in Annex I to monitor and report the amount, type and emission factor of energy used on-board by ships and other relevant information.

2. For ships falling under the scope of this Regulation for the first time after 31 August 2024, companies shall submit a monitoring plan to the verifier without undue delay and no later than two months after each ship’s first call in a port under the jurisdiction of a Member State.

3. The monitoring plan shall consist of a complete and transparent documentation and shall contain at least the following elements:

(a)the identification and type of the ship, including its name, its IMO identification number, its port of registry or home port, and the name of the ship-owner;

(b)the name of the company and the address, telephone and e-mail details of a contact person;

(c)a description of the energy conversion systems installed on-board, and the related power capacity expressed in megawatt (MW);

(d)a description that the ship has installed and certified equipment to allow connection to onshore power supply, at a specified voltage and frequency, including the gear specified in IEC/IEEE 80005-1 (High Voltage) and IEC/IEEE 80005-3 (Low Voltage) or is equipped with substitute sources of energy or a zero-emission technology as specified in Annex III;

(e)a description of the intended source(s) of energy to be used on-board while in navigation and at berth to comply with the requirements set out in Articles 4 and 5;

(f)a description of the procedures for monitoring the fuel consumption of the ship as well as the energy provided by substitute sources of energy or a zero-emission technology as specified in Annex III;

(g)well-to-wake emission factors referred to in Annex II;

(h)a description of the procedures used to monitor the completeness of the list of voyages;

(i)a description of the procedures used for determining activity data per voyage, including the procedures, responsibilities, formulae and data sources for determining and recording the time spent at sea between the port of departure and the port of arrival and the time spent at berth;

(j)a description of the procedures, systems and responsibilities used to update any of the data contained in the monitoring plan over the reporting period;

(k)a description of the method to be used to determine surrogate data for closing data gaps;

(l)a revision record sheet to record all the details of the revision history.

4. Companies shall use standardised monitoring plans based on templates. The Commission shall, by means of implementing acts, determine those templates, including the technical rules for their uniform application. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 27(3).

Article 8 - Modifications to the monitoring plan

1. Companies shall check regularly, and at least annually, whether a ship’s monitoring plan reflects the nature and functioning of the ship and whether any of the data it contains can be improved.

2. Companies shall modify the monitoring plan in any of the following situations:

(a)where a change of company occurs;

(b)where new energy conversion systems, new types of energy, including substitute sources of energy or a zero-emission technology as specified in Annex III are in use;

(c)where a change in availability of data, due to the use of new types of measuring equipment, new sampling methods or analysis methods, or for other reasons, may affect the accuracy of the data collected;

(d)data resulting from the monitoring method applied has been found to be incorrect;

(e)where any part of the monitoring plan is identified as not being in conformity with the requirements of this Regulation and the company is required by the verifier to revise it.

3. Companies shall notify to the verifiers without undue delay any proposals for modification of the monitoring plan.

4. Modifications of the monitoring plan referred to in paragraph 2, points (b), (c) and (d) of this Article shall be subject to assessment by the verifier. Following the assessment, the verifier shall notify the company concerned whether those modifications are in conformity with Article 6.

Article 9 - Certification of biofuels, biogas, renewable liquid and gaseous transport fuels of non-biological origin and recycled carbon fuels

1. Where biofuels, biogas, renewable fuels of non-biological origin and recycled carbon fuels, as defined in Directive (EU) 2018/2001, are to be taken into account for the purposes referred to in Articles 4(1) of this Regulation, the following rules apply:

(a)greenhouse gas emission factors of biofuels and biogas that comply with the sustainability and greenhouse gas saving criteria set out in Article 29 of Directive (EU) 2018/2001 shall be determined according to the methodologies set out in that Directive;

(b)greenhouse gas emissions factors of renewable fuels of non-biological origin and recycled carbon fuel that comply with the greenhouse gas emission savings thresholds set out in Article 27(3) of Directive (EU) 2018/2001 shall be determined according to the methodologies set out in that Directive;

(c)biofuels and biogas that do not comply with point (a) or that are produced from food and feed crops shall be considered to have the same emission factors as the least favourable fossil fuel pathway for this type of fuel;

(d)renewable fuels of non-biological origin and recycled carbon fuels that do not comply with point (b) shall be considered to have the same emission factors as the least favourable fossil fuel pathway for this type of fuels.

2. Companies shall provide accurate and reliable data on the GHG emission intensity and the sustainability characteristics of biofuels, biogas, renewable fuels of non-biological origin and recycled carbon fuel, verified by a scheme that is recognised by the Commission in accordance with Article 30(5) and (6) of the Directive (EU) 2018/2001.

3. Companies shall be entitled to divert from the established default values for the tank-to-wake emission factors provided that actual values are certified by means of laboratory testing or direct emissions measurements. The Commission is empowered to adopt delegated acts in accordance with Article 26, in order to supplement this Regulation by establishing the rules on conducting the laboratory testing and direct emissions measurements.

CHAPTER IV

VERIFICATION AND ACCREDITATION

Article 10 - Verification activities

1. The verifier shall assess the conformity of the monitoring plan with the requirements laid down in Articles 6 to 9. Where the verifier’s assessment identifies non-conformities with those requirements, the company concerned shall revise its monitoring plan accordingly and submit the revised plan for a final assessment by the verifier before the reporting period starts. The company concerned shall agree with the verifier on the timeframe necessary to introduce those revisions. That timeframe shall in any event not extend beyond the beginning of the reporting period.

2. The verifier shall assess the conformity of the information reported with the requirements laid down in Articles 6 to 9 and Annexes I, II and III before performing the operations set out in Article 15(2).

3. Where the verification assessment identifies incorrect statements or non-conformities with this Regulation, the verifier shall inform the company concerned thereof in a timely manner. That company shall then amend the incorrect statements or non-conformities so as to enable the verification process to be completed in time.

Article 11 - General obligations and principles for the verifiers

1. The verifier shall be independent from the company or from the operator of a ship and shall carry out the activities required under this Regulation in the public interest. For that purpose, neither the verifier nor any part of the same legal entity shall be a company or ship operator, the owner of a company, or be owned by them, nor shall the verifier have relations with the company that could affect its independence and impartiality.

2. The verifier shall assess the reliability, credibility and accuracy of the data and information relating to the amount, type and emission factor of the energy used on-board by ships, in particular:

(a)the attribution of fuel consumption and the use of substitute sources of energy to voyages;

(b)the reported fuel consumption data and related measurements and calculations;

(c)the choice and the employment of emission factors;

(d)the use of on-shore power supply or the presence of exceptions certified in accordance with Article 5(5).

3. The assessment referred to in paragraph 2 shall be based on the following considerations:

(a)the reported data are coherent in relation to estimated data that are based on ship tracking data and characteristics such as the installed engine power;

(b)the reported data are free of inconsistencies, in particular when comparing the total volume of fuel purchased annually by each ship and the aggregate fuel consumption during voyages;

(c)the collection of the data has been carried out in accordance with the applicable rules; and

(d)the relevant records of the ship are complete and consistent.

Article 12 - Verification procedures

1. The verifier shall identify potential risks related to the monitoring and reporting process by comparing reported amount, type and emission factor of the energy used on-board by ships with estimated data based on ship tracking data and characteristics such as the installed engine power. Where significant deviations are found, the verifier shall carry out further analyses.

2. The verifier shall identify potential risks related to the different calculation steps by reviewing all data sources and methodologies used by the company.

3. The verifier shall take into consideration any effective risk control methods applied by the company concerned to reduce levels of uncertainty associated with the accuracy specific to the monitoring methods used.

4. The company concerned shall provide the verifier with any additional information that enables it to carry out the verification procedures. The verifier may conduct checks during the verification process to determine the reliability of reported data and information.

Article 13 - Accreditation of verifiers

1. Verifiers shall be accredited for activities under the scope of this Regulation by a national accreditation body pursuant to Regulation (EC) No 765/2008.

2. Where no specific provisions concerning the accreditation of verifiers are laid down in this Regulation, the relevant provisions of Regulation (EC) No 765/2008 shall apply.

3. The Commission is empowered to adopt delegated acts in accordance with Article 26, in order to supplement this Regulation by establishing further methods and criteria of accreditation of verifiers. The methods specified in those delegated acts shall be based on the principles for verification provided for in Articles 10 and 11 and on relevant internationally accepted standards.

CHAPTER V - RECORDING, VERIFICATION, REPORTING AND ASSESMENT OF COMPLIANCE

Article 14 - Monitoring and recording

1. Based on the monitoring plan referred to in Article 7, and following the assessment of that plan by the verifier, companies shall record, for each ship arriving in or departing from, and for each voyage to or from a port of call under the jurisdiction of a Member State, the following information:

(a)port of departure and port of arrival including the date and hour of departure and arrival and time spent at berth;

(b)for each ship that the requirement of Article 5(1) applies, the connection to and use of on-shore power or the existence of any of the exceptions listed in Article 5(3);

(c)the amount of each type of fuel consumed at berth and at sea;

(d)the well-to-wake emission factors for each type of fuel consumed at berth and at sea, broken down by well-to-tank, tank-to-wake and fugitive emissions, covering all relevant greenhouse gases;

(e)the amount of each type of substitute source of energy consumed at berth and at sea.

2. Companies shall record the information and data listed in paragraph 1 on annual basis in a transparent manner, that enables the verification of compliance with this Regulation by the verifier.

3. By 30 March of each year, companies shall provide to the verifier the information referred to in paragraph 1.

Article 15 - Verification and calculation

1. Following the verification laid down in Articles 10 to 12, the verifier shall assess the quality, completeness and accuracy of the information provided by the company in accordance with Article 14(3).

2. On the basis of the information verified according to paragraph 1, the verifier shall:

(a)calculate, using the method specified in Annex I, the yearly average greenhouse gas intensity of the energy used on-board by the ship concerned;

(b)calculate, using the formula specified in Annex V, the ship’s compliance balance;

(c)calculate the number of non-compliant port calls in the previous reporting period including the time spent at berth for each non-compliant port call.

(d)calculate the amount of the penalties referred to in Article 20(1) and (2).

3. The verifier shall notify to the company the information referred to in paragraph 2.

Article 16 - Compliance database and reporting

1. The Commission shall develop, ensure functioning and update an electronic compliance database for the monitoring of compliance with Articles 4 and 5. The compliance database shall be used to keep a record of the compliance balance of the ships and the use of the flexibility mechanisms set out in Articles 17 and 18. It shall be accessible to the companies, the verifiers, the competent authorities and the Commission.

2. The Commission shall, by means of implementing acts, lay down the rules for access rights and the functional and technical specifications of the compliance database. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 27(3).

3. By 30 April of each year, the company shall record in the compliance database for each of its ships the information referred to in Article 15(2), as ascertained by the verifier, together with information allowing to identify the ship, the company, as well as the identity of the verifier that carried out the assessment.

Article 17 - Banking and borrowing of compliance surplus between reporting periods

1. Where the ship has a compliance surplus for the reporting period, the company may bank it to the same ship’s compliance balance for the following reporting period. The company shall record the banking of the compliance surplus to the following reporting period in the compliance database subject to approval by its verifier. The company may no longer bank the compliance surplus once the FuelEU certificate of compliance has been issued.

2. Where the ship has a compliance deficit for the reporting period, the company may borrow an advance compliance surplus of the corresponding amount from the following reporting period. The advance compliance surplus shall be added to the ship’s balance in the reporting period and subtracted from the same ship’s balance in the following reporting period. The amount to be subtracted in the following reporting period shall be equal to the advance compliance surplus multiplied by 1.1. The advance compliance surplus may not be borrowed:

(a)for the amount exceeding by more than 2% the limit set out in Article 4(2), multiplied by the energy consumption of the ship calculated in accordance with Annex I;

(b)for two consecutive reporting periods.

3. By 30 April of the year following the reporting period, the company shall record the advance compliance surplus, following approval by its verifier, in the compliance database.

Article 18 - Pooling of compliance

1. The compliance balances of two or more ships, which are verified by the same verifier, may be pooled for the purposes of fulfilling the requirements of Article 4. A ship’s compliance balance may not be included in more than one pool in the same reporting period.

2. By 30 March of the year following the reporting period, the company shall notify to the verifier the intention of including the ship’s compliance balance in a pool for the immediately preceding reporting period. In the case where the ships participating in the pool are controlled by two or more companies, the companies shall make a joint notification to the verifier.

3. By 30 April of the year following the reporting period, the pool shall be recorded in the compliance database by the verifier. The composition of the pool shall not change after that date.

4. In case of pooled compliance under paragraph 1 of this Article, and for the purposes of Article 15(2)(b), the company may decide how to allocate the total compliance balance of the pool to each individual ship, provided that the total pool compliance balance is respected. In case where the ships participating in the pool are controlled by two or more companies, the total compliance balance of the pool shall be allocated in accordance with the method specified in the joint notification.

5. If the pool average compliance balance results in the compliance surplus for an individual ship, Article 17(1) applies.

6. Article 17(2) does not apply to a ship participating in the pool.

7. The company may no longer include the ship’s compliance balance in a pool once the FuelEU certificate of compliance has been issued. 

Article 19 - FuelEU certificate of compliance

1. By 30 June of the year following the reporting period, the verifier shall issue a FuelEU certificate of compliance for the ship concerned, provided that the ship does not have a compliance deficit, after possible application of Articles 17 and 18, and does not have non-compliant port calls.

2. The FuelEU certificate of compliance shall include the following information:

(a)identity of the ship (name, IMO identification number and port of registry or home port);

(b)name, address and principal place of business of the ship-owner;

(c)identity of the verifier;

(d)date of issue of this certificate, its period of validity and the reporting period it refers to.

3. The FuelEU certificate of compliance shall be valid for the period of 18 months after the end of the reporting period.

4. The verifier shall inform the Commission and the flag State, without delay, of the issuance of any FuelEU certificate of compliance.

5. The Commission shall adopt implementing acts establishing models for the FuelEU certificate of compliance, including electronic models. Those implementing acts shall be adopted in accordance with the advisory procedure referred to in Article 27(2).

Article 20 - Penalties

1. Where on 1 May of the year following the reporting period the ship has a compliance deficit, the company shall pay a penalty. The verifier shall calculate the amount of the penalty on the basis of the formula specified Annex V.

2. The company shall pay a penalty for each non-compliant port call. The verifier shall calculate the amount of the penalty by multiplying the amount of EUR 250 by megawatts of power installed on-board and by the number of completed hours spent at berth.

3. Notwithstanding Article 19(1), the verifier shall issue a FuelEU certificate of compliance once the penalties referred to in paragraphs 1 and 2 of this Article have been paid. The actions referred to in this Article as well as the proof of the financial payments in accordance with Article 21 shall be recorded in the FuelEU certificate of compliance.

4. The Commission is empowered to adopt delegated acts in accordance with Article 26 to amend Annex V in order to adapt the formula referred to in paragraph 1 of this Article, and to amend the amount of the fixed penalty laid down in paragraph 2 of this Article, taking into account the developments in the cost of energy.

Article 21 - Allocation of penalties to support renewable and low-carbon fuels in the maritime sector

1. The penalties referred to in Article 20(1) and 20(2) shall be allocated to support common projects  aimed at the rapid deployment of renewable and low carbon fuels in the maritime sector. Projects financed by the funds collected from the penalties shall stimulate the production of greater quantities of renewable and low carbon fuels for the maritime sector, facilitate the construction of appropriate bunkering facilities or electric connection ports in ports, and support the development, testing and deployment of the most innovative European technologies in the fleet to achieve significant emission reductions.

2. The revenues generated from penalties referred to in paragraph 1 shall be allocated to the the Innovation Fund referred to in Article 10a(8) of Directive 2003/87/EC. These revenues shall constitute external assigned revenue in accordance with Article 21(5) of the Financial Regulation, and shall be implemented in accordance with the rules applicable to the Innovation Fund.

3. The Commission is empowered to adopt delegated acts in accordance with Article 26 to supplement this Regulation concerning the modalities for the payment of the penalties referred to in Article 20(1) and 20(2).

Article 22 - Obligation to carry a valid FuelEU certificate of compliance on-board

1. The ships calling at a port under the jurisdiction of a Member State shall carry on-board a valid FuelEU certificate of compliance.

2. The Fuel EU certificate of compliance issued for the ship concerned in accordance with Article 19 shall constitute evidence of compliance with this Regulation.

Article 23 - Enforcement

1. Member States shall lay down the rules on sanctions applicable to infringements of this Regulation and shall take all measures necessary to ensure that they are implemented. The sanctions provided for must be effective, proportionate and dissuasive. Member States shall notify those provisions to the Commission by [dd/mm/20xx], and shall notify to the Commission without delay any subsequent amendments.

2. Each Member State shall ensure that any inspection of a ship in a port under its jurisdiction carried out in accordance with Directive 2009/16/EC includes checking that a valid FuelEU certificate of compliance is carried on board.

3. Where a ship has failed to present a valid FuelEU certificate of compliance for two or more consecutive reporting periods and where other enforcement measures have failed to ensure compliance, the competent authority of the Member State of the port of call may, after giving the opportunity to the company concerned to submit its observations, issue an expulsion order. The competent authority of the Member State shall notify the expulsion order to the Commission, the other Member States and the flag State concerned. Every Member State, with the exception of any Member State whose flag the ship is flying, shall refuse entry of the ship which is subject to the expulsion order into any of its ports until the company fulfils its obligations. Where the ship flies the flag of a Member State, the Member State concerned shall, after giving the opportunity to the company concerned to submit its observations, order a flag detention until the company fulfils its obligations.

4. The fulfilment of those obligations shall be confirmed by the notification of a valid FuelEU certificate of compliance to the competent national authority which issued the expulsion order. This paragraph shall be without prejudice to the provisions of international law applicable in the case of ships in distress.

5. Sanctions against a specified ship by any Member State shall be notified to the Commission, to the other Member States and to the flag State concerned.

Article 24 - Right to review

1. The companies shall be entitled to apply for a review of the calculations and measures addressed to them by the verifier under this Regulation, including the refusal to issue a FuelEU certificate of compliance pursuant to Article 19(1).

2. The application for review shall be lodged, within one month of the notification of the result of calculation or of the measure by the verifier, with the competent authority of the Member State in which the verifier has been accredited. The decision of the competent authority shall be subject to judicial review

3. The decisions taken under this Regulation by the managing body of the port shall be subject to judicial review.

Article 25 - Competent authorities

Member States shall designate one or more competent authorities as responsible for the application and enforcement of this Regulation (‘competent authorities’). They shall communicate their names and contact information to the Commission. The Commission shall publish on its website the list of competent authorities.


CHAPTER VI

DELEGATED AND IMPLEMENTING POWERS AND FINAL PROVISIONS

Article 26 - Exercise of delegation

1. The power to adopt delegated acts is conferred on the Commission subject to the conditions laid down in this Article.

2. The power to adopt delegated acts referred to in Articles 4(6), 5(4), 9(3), 13(3), 20(4), and 21(3) shall be conferred on the Commission for an indeterminate period of time from [date of entry into force of this Regulation].

3. The delegation of power referred to in Articles 4(7), 5(4), 9(3), 13(3), 20(4), and 21(3) may be revoked at any time by the European Parliament or by the Council. A decision to revoke shall put an end to the delegation of the power specified in that decision. It shall take effect the day following the publication of the decision in the Official Journal of the European Union or at a later date specified therein. It shall not affect the validity of any delegated acts already in force.

4. Before adopting a delegated act, the Commission shall consult experts designated by each Member State in accordance with the principles laid down in the Interinstitutional Agreement on Better Law-Making of 13 April 2016.

5. As soon as it adopts a delegated act, the Commission shall notify it simultaneously to the European Parliament and to the Council.

6. A delegated act adopted pursuant to Articles 4(7), 5(4), 9(3), 13(3), 20(4), and 21(3) shall enter into force only if no objection has been expressed either by the European Parliament or by the Council within a period of two months of notification of that act to the European Parliament and the Council or if, before the expiry of that period, the European Parliament and the Council have both informed the Commission that they will not object. That period shall be extended by two months at the initiative of the European Parliament or of the Council.

Article 27 - Committee procedure

1. The Commission shall be assisted by the Committee on Safe Seas and the Prevention of Pollution from ships (COSS) established by Regulation (EC) 2099/2002 of the European Parliament and of the Council 29 . That committee shall be a committee within the meaning of Regulation (EU) No 182/2011.

2. Where reference is made to this paragraph, Article 4 of Regulation (EU) No 182/2011 shall apply. Where the opinion of the Committee is to be obtained by written procedure, that procedure shall be terminated without result when, within the time-limit for delivery of the opinion, the chair of the committee so decides

3. Where reference is made to this paragraph, Article 5 of Regulation (EU) No 182/2011 shall apply. Where the committee delivers no opinion, the Commission shall not adopt the draft implementing act and the third subparagraph of Article 5(4) of Regulation (EU) No 182/2011 shall apply.

Article 28 - Report and review

1. The Commission shall report to the European Parliament and the Council, by 1 January 2030, the results of an evaluation on the functioning of this Regulation and the evolution of the technologies and market for renewable and low-carbon fuels in maritime transport and its impact on the maritime sector in the Union. The Commission shall consider possible amendments to:

(a)the limit referred to in Article 4(2);

(b)the ship types to which Article 5(1) applies;

(c)the exceptions listed in Article 5(3).

Article 29 - Amendments to Directive 2009/16/EC

The following point shall be added to the list set out in Annex IV to Directive 2009/16/EC: ‘51. The FuelEU certificate of compliance issued under Regulation (EU) xxxx on the use of renewable and low-carbon fuels in maritime transport’.

Article 30 - Entry into force

This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union. It shall apply from 1 January 2025.

This Regulation shall be binding in its entirety and directly applicable in all Member States.