UK ETS for the Maritime Sector – Update – Part 2 of 2

Following the publication of Part 1 of our series on the UK ETS for the Maritime Sector (see link below), this second article explores additional key features of the proposed scheme ahead of its 1 July 2026 implementation date.

Maritime UK ETS Main Response

Regulatory Framework 

The UK Monitoring, Reporting and Verification (MRV) requirements will be used as the basis for the UK ETS MRV. The two regimes will be separate from each other, meaning that operators will need to comply with both sets of requirements. 

The UK ETS MRV will include greater reporting duties such as the requirement to report methane and nitrous oxide emissions and port emissions, whether travelling domestically or internationally. 

Emissions will be assessed on a Tank-to-Wake basis. This specifically targets the emissions that occur during the ship’s operations and excludes upstream emissions from fuel production or transport. Nonetheless, as part of the on-going review of the scheme, there is potential that a Well-to-Wake approach will be introduced in the future. 

As part of the reporting duties, operators will need to submit an Emissions Monitoring Plan (EMP) and Annual Emissions Report (AER) on a per-operator basis, rather than per ship. 

A Document of Compliance will not be required. Instead, AERs will be verified by an accredited verifier, while EMPs will be approved by UK ETS regulators. 

Compliance will be managed by the UK ETS regulators via the Manage your Emissions Trading Scheme (METS) system and the UK Emissions Trading Registry. 

Regulators

Regulators tasked with overseeing compliance with the UK ETS are:

• England: The Environment Agency (EA) 
• Scotland: The Scottish Environment Protection Agency (SEPA) 
• Wales: Natural Resources Wales (NRW)
• Northern Ireland: The Northern Ireland Environment Agency (NIEA)
• Offshore oil and gas: The Offshore Petroleum Regulator for Environment and Decommissioning (OPRED) - (part of DESNZ – The Department for Energy Security and Net Zero)

Maritime operators will be assigned to a regulator based on the location of their place of residence or registered address. For operators who do not have a registered office or place of residence in the UK, regulatory responsibility will fall to the Environment Agency.

Allowances

The Authority will be adding 9,323,546 allowances to the current UK ETS cap for the purposes of including the domestic maritime sector. Operators will be able to purchase allowances at any point once they have the necessary account with the UK Emissions Trading Registry. 

How to Prepare?

Operators may express interest in voluntary early onboarding with the Environment Agency ahead of the official launch on 1 July 2026. However, the early onboarding has not formally been launched yet. 

Meanwhile, the official guidance provides that operators should:

1. Apply for an EMP.
2. Familiarise themselves with the features of the UK METS system.
3. Sign up for Environment Agency newsletters.
4. Contact the Environment Agency’s helpdesk at etmaritimehelp@environmentagency.gov.uk for any queries.

Future Developments

The Authority will review the scheme in 2028 to consider and outline next steps for the following:

1. How the scheme is working.
2. Lowering the threshold to 400GT for in-scope ships.
3. The practicalities of undertaking MRV for ships between 400 and 5,000 GT.
4. Ensuring alignment with international schemes.
5. Reviewing the exemptions.

Separately, the Authority has also committed to reviewing the interaction of the UK ETS and the IMO Net-Zero Framework (NZF) once adopted. The IMO is due to reconsider the NZF in October 2026. 

Expansion to International Maritime Voyages

Of significance in the main response was the Authority’s indication of their intention to include emissions from international voyages starting in 2028. To that end, the Authority launched a consultation on 25 November 2025 which closed on 20 January 2026.

As the Authority explains, the expansion to international maritime voyages was prompted by the delay in the IMO adopting the NZF and by a desire to align coverage between the UK ETS and EU ETS. 

The expansion is intended to lower the UK’s share of international voyage emissions which was measured to be approximately 7.5 MtCO2e (Million Tonnes of Carbon Dioxide Equivalent) in 2019. 

The main issues the Authority sought input on included: 

1. Whether from 2028, international voyages to or from the UK should be subject to the UK ETS for 50% of their emissions and for 100% of their emissions while in port in the UK (in line with EU ETS).
2. Whether emissions from voyages to and from Crown Dependencies and British Overseas Territories should be captured under the proposals.
3. Whether offshore ships should be subject to the UK ETS for 50% of their emissions from international voyages (further guidance and legislation for offshore ships is being prepared).
4. Whether the 5% reduction in allowance surrender for ice class ships, as applied by the EU ETS, should be excluded.
5. Whether any action should be taken against gaming, transhipment, or evasion if the UK ETS extends to cover emissions from international maritime voyages.

While the UK ETS authority will use the responses received to develop a final policy position on the proposed expansion, the Authority has preliminarily proposed the following:

1. There will be an increase to the allowance cap to account for international voyages.
2. “International voyage” will include a voyage in either direction between a UK port and a port outside of the UK, including voyages to and from Crown Dependencies and British Overseas Territories.
3. Participants will monitor and report 100% of their greenhouse gas emissions on a voyage between a UK port and a port outside of the UK. However, operators would only be required to surrender allowances to cover 50% of their emissions.

Crucially, the Authority will consider whether the current enforcement powers under the UK ETS should be expanded, in line with regional schemes such as the EU ETS, to include further powers such as powers of expulsion and port bans. 

Next Steps?

To prepare for the evolving landscape around the UK ETS maritime framework, maritime operators should begin assessing their fleet’s potential exposure to the scheme and consider reviewing contractual arrangements to ensure that responsibilities and cost allocations are clearly defined. If you would like further information or wish to discuss these developments, our team would be pleased to assist you.