UK Unveils Maritime Decarbonisation Strategy For Emission Pricing & Fuel Regulations

2nd June 2025

The UK has launched a comprehensive new maritime decarbonisation strategy, building on international efforts while placing greater focus on domestic emissions and smaller vessels. Maritime Minister Mike Kane presented the strategy to the House of Commons, outlining the next phase in aligning the sector with the country’s climate goals.

In 2019, the UK’s domestic maritime sector generated approximately eight million tonnes of CO₂-equivalent emissions on a full lifecycle basis. With a goal of achieving net-zero lifecycle greenhouse gas emissions by 2050, the UK has set interim targets of a 30% reduction by 2030 and 80% by 2040, relative to 2008 levels.

Key elements of the new strategy include:

• Expansion of the UK Emissions Trading Scheme to cover domestic maritime GHG emissions beginning in 2026.
• Support for global emissions pricing, with the UK advocating for the International Maritime Organization (IMO) to adopt a framework by 2027.
• Introduction of domestic fuel regulations, pending consultation in 2026, to drive the uptake of zero and net-zero GHG emission fuels and energy sources.
• Port-level initiatives to reduce emissions at berth and promote broader environmental planning.

A notable feature of the strategy is its inclusion of smaller vessels, particularly those under 400 gross tons. The government acknowledges that some sectors, such as fishing, may face challenges, while others—like offshore wind support vessels, could lead innovation. A call for evidence has been issued to guide policy development for this segment. The strategy also encourages ports to evaluate their own decarbonization efforts and consider wider environmental strategies, aligning infrastructure with national climate ambitions.

Despite acknowledging the complexity of the transition, the government sees significant economic potential. Conservative estimates suggest that decarbonizing the UK maritime sector could generate £130 to £180 million ($168 to $233 million) in gross value added annually and support 1,400 to 2,100 jobs per year through 2050. The UK Chamber of Shipping welcomed the new strategy, describing it as a timely successor to the 2019 Clean Maritime Plan and a crucial step forward for the industry. Maritime decarbonisation is critically important for both environmental and economic reasons. Here's a breakdown of why it matters:

1. Global Emissions Impact
1. Shipping accounts for ~3% of global greenhouse gas emissions—roughly equal to the emissions of a major industrialized country.
2. Without action, maritime emissions could rise by up to 130% by 2050 due to growing trade volumes.
2. Climate Goals Cannot Be Met Without It
1. To achieve the Paris Agreement’s 1.5°C target, every sector—including shipping—must reduce emissions rapidly.
2. Maritime transport is included in net-zero national strategies and must align with broader climate goals.
3. Hard-to-Abate Sector
1. Shipping is energy-intensive and difficult to electrify, making it one of the "hard-to-abate" sectors.
2. Decarbonisation solutions (like alternative fuels, efficiency technologies, and carbon capture) are vital for progress.
4. Regulatory Pressure is Increasing
1. The International Maritime Organization (IMO) has set a target of net-zero emissions by 2050.
2. Regional policies (e.g., EU ETS, UK Maritime Strategy) are introducing emission pricing, fuel mandates, and GHG intensity limits.
5. Economic and Trade Implications
1. Decarbonisation can create new markets and jobs (e.g., in green fuel production, retrofit technologies, port infrastructure).
2. Ships that don’t comply with emerging standards risk losing market access or facing high carbon costs, impacting trade competitiveness.
6. Environmental and Social Benefits
1. Cleaner fuels and technologies reduce air pollution, including SOx, NOx, and particulate matter, improving health near ports and coastal areas.
2. Supports sustainable development goals (SDGs) like climate action, health, and responsible consumption.

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