UK MRV and UK ETS

UK ETS Maritime Expansion

The UK Emissions Trading Scheme (UK ETS) replaced the UK’s participation in the European Union Emissions Trading Scheme (EU ETS) on 1 January 2021. The scope of the UK ETS will expand to domestic maritime from July 2026, introducing a cap-and-trade system, similar to the EU ETS framework.

Application of UK ETS for Shipping

The UK ETS expansion to maritime will apply to ships of 5,000 GT and above and will cover carbon dioxide (CO₂), methane (CH₄) and nitrous oxide (N₂O) emissions in alignment with the EU ETS regime. The greenhouse gas emissions will be calculated on a carbon dioxide equivalent (CO₂e) basis, based on their Global Warming Potential (GWP):

• CO₂: GWP of 1 per tonne
• CH_4: GWP of 28 per tonne
• N₂O: GWP of 265 per tonne

The emissions in scope are the following:

• Emissions from domestic voyages, defined as those between UK ports, including those which start and end at the same port. The definition includes emissions while at anchor and while moored.
• Emissions within UK ports, comprising emissions at berth in UK ports and emissions from movements within UK ports, regardless of whether the voyage is domestic or international.

The scheme will use a Tank-to-Wake emissions accounting approach with standard emission factors for conventional fuels. Sustainable fuels of biological and non-biological origin will be zero-rated.

Coverage and Exemptions

UK ETS will cover 100% of emissions from domestic voyages and port activities. The UK ETS Authority intends to expand the scheme from 2028 to include emissions from international maritime voyages starting or ending in the UK. These voyages will be subject to the UK ETS carbon price for 50% of their emissions, in line with the current EU ETS scope.

A 50% deduction from UK ETS surrender obligation will be granted for voyages between Northern Ireland and Great Britain, to avoid disparities until international voyages are included.

The following exemptions are provided, subject to review in 2028:

• Ferry services to Scotland’s islands and certain peninsular communities.
• Fish catching and fish processing ships.

Implementation Timeline

The UK ETS maritime regime will launch on 1 July 2026, so all compliance obligations will apply from this date.

• First scheme year: 1 July – 31 December 2026
• Subsequent scheme years: Calendar year (1 January – 31 December)

The deadline for submitting the verified Annual Emissions Reports is 31 March after the scheme year ends, and the deadline for surrendering allowances is 30 April.

To ease transition, the Authority will allow a “double-surrender” provision for the 2026 and 2027 scheme years. This means that the surrender deadline for allowances related to the first scheme year will also be 30 April 2028. Operators will still be able to purchase allowances at any point once they have opened an account in the UK Emissions Trading Registry.

Figure 1: Compliance obligations for the 2026 scheme year.

Figure 2: Compliance obligations for the 2027 scheme year.

Expansion to Offshore Ships

The inclusion of offshore ships within the UK ETS will be delayed until 1 January 2027, aligning with the EU ETS timeline to avoid market distortion. Treatment will broadly follow EU ETS, reducing administrative complexity. Further guidance will be provided in the future. 

Compliance Responsibility

The Registered Owner of a ship will be the default responsible entity unless responsibility has been delegated to the ISM Company through a written agreement that cannot be made retrospectively. Where a delegation exists, the ISM Company must provide the Registered Owner’s contact details and complete a declaration of delegated responsibility within the Manage your Emissions Trading Scheme (METS) system.

Each operator will be required to submit one Emissions Monitoring Plan (EMP) and one Annual Emissions Report (AER), rather than separate documents for each ship.

• The EMP must be submitted for approval to the regulator—rather than to an accredited verifier—listing the ships under the operator’s responsibility.
• Operators must appoint an independent verifier accredited by the UK Accreditation Service (UKAS) to verify their AER, which will include the emissions from each ship and aggregated data.
• The issuance of a Document of Compliance (DoC) will not be required under the UK ETS.

The regulator will be assigned based on the location of the operator’s place of residence or registered address. In case operators do not have a registered office or place of residence in the UK, regulatory responsibility will fall to the Environment Agency. The designated regulators are as follows:

• England – Environment Agency
• Northern Ireland – Northern Ireland Environment Agency
• Scotland – Scottish Environment Protection Agency
• Wales – Natural Resources Wales.

Allowances and Penalties

The UK ETS maritime regime will follow the principles of the EU ETS, allowing operators to purchase allowances via government auctions or on the secondary market throughout the year in preparation for surrender. To purchase allowances, operators must hold an account in the UK Emissions Trading Registry.

The UK ETS expansion to maritime will mirror existing provisions for installation operators and aircraft operators covered by the scheme, including the application of civil penalties for non-compliance.

Actions for Compliance

1. Develop an Emissions Monitoring Plan (EMP) in accordance with the UK ETS requirements and submit it for approval to the appropriate regulator. Maritime operators must apply for their EMP within 42 days of commencing the performance of a maritime activity. An EMP may also be submitted during the voluntary phase, prior to the commencement of the scheme on 1 July 2026.
2. From 1 July 2026, and from 1 January in subsequent years, start monitoring CO2, CH4 and N2O emissions according to the approved EMP.
3. By 31 March following the end of each scheme year, submit the verified Annual Emissions Report (AER) detailing the emissions for each ship under your responsibility.
4. By 30 April each year, surrender the required number of allowances to cover your verified emissions.
   1. For the first two scheme years, 2026 and 2027, the surrender deadline is 30 April 2028 under the double-surrender provision.

Early Onboarding

The UK Environment Agency has launched early onboarding for operators with a registered office or place of residence in England or who do not have a registered place of residence in the UK.  Participation at this stage is voluntary and can be completed through the online portal UK ETS Maritime Voluntary Phase and Newsletter Sign Up or email to etmaritimehelp@environment-agency.gov.uk.

The UK Environment Agency encourages companies to register early to support a smooth introduction of the scheme. As part of this process:

• The regulator will create the operator’s METS account, and
• Operators will have the opportunity to apply for an Emissions Monitoring Plan (EMP) through the METS portal. During this voluntary phase, EMPs are only approved in principle. Formal EMP approvals will be issued once the UK ETS expands to maritime on 1 July 2026. The EMP must be completed and submitted through the METS portal. Operators may fill in the EMP manually, upload ship and emissions data via an XML file, or transfer information through an API using an external data provider. Additional detailed instructions are available in the METS guidance section.

Frequently Asked Questions

1.     What emissions will be covered under UK ETS?

The UK ETS will apply to ships of 5,000 GT and above and will cover 100% of carbon dioxide (CO₂), methane (CH₄) and nitrous oxide (N₂O) emissions from the following:

Between UK ports, including those which start and end at the same port, including emissions while at anchor and while moored.Within UK ports, which includes emissions at berth in UK ports and emissions from movements within UK ports, regardless of whether the voyage is domestic or international.

2.     Will offshore ships be covered under UK ETS?

In alignment with the EU ETS, the offshore ships will be included in the UK ETS regime from 1 January 2027.

3.     Should voyages to/ from ports in UK Overseas Territories and Crown Dependencies be reported under the UK ETS?

The emissions from voyages between two Crown Dependencies or Overseas Territories or from a port in an Overseas Territory or Crown dependency to a non-UK port should not be included at the 2026 implementation stage. This is subject ongoing monitoring and review.

4.     Should voyages to/from Port of Akrotiri (CYAKT) and Dhekelia (CY DHK) be reported under UK ETS or EU ETS?

Although the Ports of Akrotiri and Dhekelia are geographically located in Cyprus, they fall under the jurisdiction of British Overseas Territory. As such, they should be treated as non-EU port, under the scope of the EU MRV/ETS and Fuel EU regimes.

Under UK ETS, they are not considered UK ports, as outlined above. Please refer to the above FAQ for more details.

5.     Should voyages between a UK port and an EU port be reported under both regimes?

For the 2026 Implementation stage, voyages between UK and EEA ports (and vice versa) are not to be recorded under the UK ETS regime. Data on these voyages should continue to be submitted to the European Commission under the EU MRV regime.

Only the emissions generated during UK port stays related to these voyages are to be reported in the UK ETS Emissions Report.

6.     Who will be responsible for reporting and surrendering allowances?

The Registered Owner of a ship is the default responsible entity. Under a written agreement, the ISM Company may assume responsibility. Evidence of that agreement must be available on request.

7.     What should be done when there is a change in the ISM Company?

When there is a change to the written agreement with the registered owner that affects compliance with UK ETS, the ISM Company must notify the regulator in writing within 14 days of the change to

the written agreement taking effect.

8.     Will the emission factors for fuels cover the full lifecycle emissions?

The scheme will use a Tank-to-Wake emissions accounting approach for conventional fuels. Sustainable fuels of biological and non-biological origin will be zero-rated.

9.     Should a Document of Compliance (DoC) be carried on board for the purposes of the UK ETS?

No. A Document of Compliance (DoC) is not required under the UK ETS. Compliance is managed by UK ETS regulators through the Manage your Emissions Trading Scheme (METS) system and the UK Emissions Trading Registry.

10.  When can maritime operators start registering with the regulator?

The UK Environment Agency has launched early onboarding for operators with a registered office or place of residence in England or outside of the UK. Participation at this stage is voluntary and can be completed through this link or email to etmaritimehelp@environment-agency.gov.uk.

Maritime operators with a registered address or those who are resident in the other UK Nations can contact their relevant regulators through the helpdesk emails listed below.

• Scotland: Scottish Environment Protection Agency - emission.trading@sepa.org.uk.
• Wales: Natural Resources Wales (NRW) - GHGHelp@cyfoethnaturiolcymru.gov.uk.
• Northern Ireland: Northern Ireland Environment Agency (NIEA)- emissions.trading@daera-ni.gov.uk.

11.  Does the monitoring plan need to be approved by a regulator or by the verifier?

Emissions Monitoring Plans (EMPs) will be issued by the UK ETS regulators through METS. A single EMP will be required per operator, not per ship, and it will include a list of the ships for which the operator is responsible. Verifiers will not have any role in approving EMPs under the UK ETS.

The EMP will include:

• Operator details.
• List of ships.
• Ship details.
• Fuels, emissions sources and measurement devices.
• Operator level control and management procedures.

There are three ways to complete the EMP application via METS: manual entry, XML upload or API.

12.  Under which conditions can an operator be exempt from ‘per‑voyage’ monitoring?

An operator is not required to carry out per‑voyage monitoring for a ship if the following conditions are met:

1. The ship is scheduled to perform more than 300 voyages while under the responsibility of the maritime operator, and
2. The ship does not make any journeys that fall outside the definition of a “voyage” under the UK ETS regime.

In this case, the operator may monitor the following for the entire scheme year for that ship:

(a) The total number of voyages.
(b) The total amount of each type of fuel consumed.
(c) The emission factor used for each type of fuel consumed, and
(d) The total amount of each greenhouse gas emitted.

13.  Will the UK authorities approve the Annual Emissions Report?

The Annual Emissions Report must be verified by an independent verifier, that is accredited by UKAS for UK ETS. The verified annual emissions report must then be submitted to the regulator through METS by 31 March in the year following the scheme year. Under the UK ETS, only one Annual Emissions Report (AER) per operator is required, rather than one for each ship.

14.  If a voyage started in 2026 but ended in 2027, in which scheme year must its emissions be reported?

Where a voyage commences in one scheme year but ends in another scheme year, the

respective emissions must be accounted for under the scheme year in which they occur.

15.  Are offshore installations considered a port of call?

Offshore installations, assigned with United Nations Code for Trade and Transport Locations (UN/LOCODE), are considered ports of call and shall be reported accordingly.

16.  How can operators obtain UK ETS allowances? 

UK ETS works on the cap-and-trade principle, similar to the EU ETS. A cap is set on the total amount of certain greenhouse gases, which is reduced over time, is divided into allowances, each equivalent to 1 tonne of CO₂ equivalent greenhouse gas (UKAs).

The operators must acquire allowances through auctions run by the Authority or from other participants through secondary markets, throughout the year in preparation for surrender.

17.  What is the official market where UK ETS allowances will be traded?

Both the auction platform and secondary market services under the UK ETS are provided by ICE Futures Europe. Market participants need to be registered with ICE Futures Europe to take part in UKA auctions. To purchase and surrender allowances, operators must hold an account in the UK Emissions Trading Registry.

18.  What is the procedure for opening a Maritime operator holding account (MOHA)?

For operators that have been issued an emissions monitoring plan, the UK Registry Administrator will open the corresponding holding accounts. Access to these accounts will not be provided until the scheme becomes operational in July 2026.

19.  Will there be a charge for EMP applications and opening accounts?

During the voluntary phase, up to 1 July 2026, there is no charge to apply for an EMP or to set up a  MOHA with one authorised representative (with a surrender-only permission).

From 1 July 2026, charges will apply for EMP applications. In addition, an annual subsistence fee (charged on a pro-rata and index-linked basis) will apply for maintaining the METS account. These charges include the costs of setting up and maintaining a MOHA with one authorised representative (with a surrender-only permission).

20.  Can charterers purchase UKAs to reimburse the responsible entity?

Yes. Legal persons and individuals can apply for a trading account in the UK ETS Registry, which is used to hold and trade allowances and to participate in UKA auctions (subject to eligibility criteria). Although this type of account cannot be used for UK ETS compliance obligations, it allows charterers to purchase and transfer UKAs.

21.  Will UK MRV be maintained even if UK-ETS MRV starts?

Statutory Instrument 2026 No. 245, The Merchant Shipping (Monitoring, Reporting and Verification of Carbon Dioxide Emissions) (Revocation) Regulations 2026, has revoked the existing UK MRV scheme. From July 2026, the planned expansion of the UK ETS to the maritime sector will introduce a new digital system for data collection, along with updated regulations for monitoring, reporting, and verification of UK maritime emissions.