What is already in force
Under MARPOL Annex VI, every ship in scope already lives with a technical and operational pair. EEXI is a one time design efficiency requirement, which most existing ships met through engine or shaft power limitation. CII is the annual operational carbon intensity rating from A to E, with a corrective action plan required for persistent poor ratings. The required CII tightens each year against a 2019 reference line. The reduction factor is 11 per cent for 2026. Resolution MEPC.400(83), adopted on 11 April 2025, replaced Table 1 of the G3 Guidelines and fixed the remaining factors: 13.625 per cent for 2027, 16.25 per cent for 2028, 18.875 per cent for 2029 and 21.5 per cent for 2030. MEPC 83 separately agreed a work plan for Phase 2 of the CII review, running from spring 2026 to spring 2028. In Europe the regional layer is fully operational. Maritime transport entered the EU Emissions Trading System from 2024 for ships of 5,000 gross tonnage and above, with a phase in of 40 per cent of verified emissions for 2024, 70 per cent for 2025 and 100 per cent for 2026 and each year after. Methane and nitrous oxide join carbon dioxide in scope from 2026. Offshore ships of 5,000 gross tonnage and above come into the system from 2027. Coverage is 100 per cent of emissions on voyages and port calls within the EU and EEA, and 50 per cent on voyages into or out of it. One gap in that scope is worth knowing about. General cargo and offshore ships of 400 to 5,000 gross tonnage are in the EU MRV regime from 2025 but are not in the EU ETS. A Commission report on whether to include them is due by 31 December 2026. The scope described here is the position as at August 2026. FuelEU Maritime has applied since 1 January 2025 to ships above 5,000 gross tonnage. It requires a falling greenhouse gas intensity of the energy used on board, measured against a 2020 baseline of 91.16 grams of CO2 equivalent per megajoule. The reduction is 2 per cent from 2025, 6 per cent from 2030, 14.5 per cent from 2035, 31 per cent from 2040, 62 per cent from 2045 and 80 per cent from 2050. Pooling, banking and borrowing are permitted, and penalties are calculated on the size of the shortfall. Borrowing carries a 10 per cent surcharge and two hard limits: the amount borrowed cannot exceed 2 per cent of the applicable greenhouse gas intensity limit multiplied by the energy used on board in the period, and borrowing cannot be used in two consecutive reporting periods. An onshore power supply requirement follows for container and passenger ships at covered ports from 1 January 2030.
The IMO Net-Zero Framework: approved, not yet adopted
The centrepiece of the IMO's mid term measures is the Net-Zero Framework. It combines a global fuel intensity standard with a greenhouse gas pricing mechanism for ships of 5,000 gross tonnage and above. As approved, ships exceeding their target buy remedial units at two tiers, priced at USD 100 and USD 380 per tonne of CO2 equivalent, with proceeds going to an IMO Net-Zero Fund. Those two prices are fixed only for the reporting periods 2028 to 2030. Prices for later periods are to be set separately. The first reporting period was drafted to begin on 1 January 2028. The adoption timeline has slipped twice, and the current position needs stating carefully. The framework was approved at MEPC 83 in April 2025. The second extraordinary session of the Committee, held from 14 to 17 October 2025, adjourned the adoption decision for one year. MEPC 84, held from 27 April to 1 May 2026, did not adopt it either. The Committee referred the work to one intersessional working group, meeting from 1 to 4 September and from 23 to 27 November 2026, together with a one day expert workshop on chain of custody models. MEPC 85 runs from 30 November to 3 December 2026, and the adjourned second extraordinary session is set to resume on 4 December 2026, subject to confirmation by MEPC 85. That resumed session, not MEPC 85, is the adoption decision point. This is the position as at August 2026. Under MARPOL's tacit acceptance procedure, entry into force would follow adoption by roughly sixteen months. The honest planning assumption is uncertainty about timing, not about direction. Every serious compliance pathway retains value under any plausible adoption schedule: fuel choice, efficiency investment and monitoring capability. The EU regime already prices carbon for a large share of tonnage regardless of what the IMO decides in December.
The fuels, soberly assessed
LNG is mature and widely bunkerable. It cuts CO2 meaningfully but not transformatively, and it carries methane slip scrutiny, which now has direct financial consequence under EU ETS from 2026. Methanol is liquid at ambient conditions and increasingly ordered. Green methanol supply is the binding constraint, not the engine. Ammonia is carbon free at the point of use. Its toxicity and safety rules are still being worked through at the IMO, and crew competence is a live question. Biofuels drop into existing engines. Feedstock availability and certification of the sustainability claim are the constraints. Efficiency measures across hull, propeller, routing and port time remain the cheapest tonne of CO2 avoided on every ship, whatever the fuel. Each pathway carries its own compliance trail. Gas fuelled ships operate under the IGF Code. Crews need fuel specific training. Bunkering, documentation and well to wake accounting differ by regime. The fuel decision is a regulatory architecture decision, not only an engineering one.
What a defensible strategy looks like
Fleet by fleet, the durable approach is the same. Measure honestly, because data quality now has direct financial value under CII, EU ETS and FuelEU at the same time. Model each ship's trajectory against the tightening curves rather than against last year. Sequence investments so that cheap efficiency buys time for expensive fuel decisions. Paper the charterparty side, because who pays for carbon and who controls the operational choices that drive it is now a live negotiation. Operators who treat the regulations as a planning input rather than an annual surprise are consistently the ones keeping their trading freedom.