By ShipCalculators.com · Published 8 May 2026

Reward / Surplus Unit issuance and pooling under the IMO Net-Zero Framework

The Surplus Unit (SU) is the over-compliance credit instrument introduced into MARPOL Annex VI Chapter 4 ter by the IMO Net-Zero Framework approved at MEPC 83 in April 2025, issued under regulation 30ter to ships whose annually attained well-to-wake GHG fuel intensity lies at or below the Tier 2 Direct Compliance Threshold for the reporting year. The SU is a fungible, ledger-recorded, ship-issued unit denominated in tonnes of CO2-equivalent, transferable on the IMO ledger and surrenderable against Tier 1 Required GFI Remediation Unit obligations of any other ship in the same vintage window. The broader reward unit (RewU) terminology, which appears in the MEPC 81 to 82 negotiating record and in industry literature on zero and near-zero GHG fuels, refers to a generalised over-compliance credit family that includes the operational SU plus the proposed RFNBO-equivalent multipliers for ships running on green hydrogen, green ammonia, e-methanol or biomethane with verifiable upstream certification. Pooling rules permit the aggregation of SUs across ships in a corporate pool, with optional commercial pooling between unrelated owners under bilateral agreement; pool clearing operates on an annual basis aligned to the IAPP renewal survey, and unused SUs may be banked for up to three subsequent compliance years before forced expiry. ShipCalculators.com hosts the GFI compliance calculator for end-to-end SU issuance and obligation computations across single ships and small fleets, and the FuelEU pooling calculator and FuelEU pooling credit calculator for the corresponding FuelEU Maritime pooling computations that interact with the SU framework on European voyages.

Contents

Background: from “reward units” concept to the MEPC 83 Surplus Unit

The terminology of the over-compliance credit shifted three times during the negotiating cycle that ran from MEPC 80 in July 2023 to MEPC 83 in April 2025, and the residue of those shifts persists in industry literature and in the negotiating-document record. Reading the current Surplus Unit instrument cleanly requires distinguishing the three vocabulary layers.

The earliest negotiating drafts circulated by the Intersessional Working Group on GHG Emissions from Ships (ISWG-GHG) used the generic phrase reward unit (RewU) for any positive-sided credit instrument that an over-compliant ship might earn under a feebate-style mid-term measure. The RewU label was deliberately neutral on the precise issuance trigger, on the denomination, on the transferability rules, and on the relationship to the Required GFI. It functioned as a placeholder pending resolution of the architecture debate between Options A through E. Several Member State submissions, particularly those from Pacific Small Island Developing States and from a coalition of Northern European flag administrations, used RewU language interchangeably with “credit” and “voucher” terminology in the same paragraph, signalling that no single mechanism was yet on the table.

A second vocabulary layer entered the record at MEPC 81 in March 2024, when the negotiating text began to distinguish between two flavours of RewU. The first flavour was the direct over-compliance RewU, awarded to a ship whose attained GFI was below a still-undefined threshold by an amount proportional to the over-compliance margin. The second flavour was the fuel-class RewU, awarded to a ship using a designated zero or near-zero GHG fuel regardless of the precise attained-GFI margin, with the credit amount set by a multiplier on the energy delivered by the qualifying fuel. The fuel-class RewU was modelled on the FuelEU Maritime renewable-fuel-of-non-biological-origin multiplier provisions of Regulation (EU) 2023/1805, which double-counts qualifying RFNBO energy until 2033. The two-flavour split reflected a substantive policy disagreement between delegations who saw the over-compliance credit as a pure efficiency instrument and delegations who saw it as a fuel-development subsidy.

The third and operative vocabulary layer was settled at MEPC 83 in April 2025. The negotiated text adopted the name Surplus Unit (SU) for the operational instrument, deliberately discarding the older RewU label to break the linkage with the FuelEU multiplier debate and to anchor the new credit in the two-tier architecture of regulations 29ter and 30ter. The SU as enacted is purely a direct-over-compliance instrument; it has no fuel-class multiplier, and the RFNBO-equivalent multiplier debate was deferred to a workstream feeding into MEPC 86 in 2027 for possible incorporation into the 2028 review of the framework. The result is a clean, single-trigger credit that depends only on the ship’s WtW attained GFI relative to the Tier 2 Direct Compliance Threshold, not on the fuel pathway used to achieve that intensity.

The persistence of RewU language in industry literature and finance documentation written before mid-2025 is therefore historical rather than substantive. When a project-finance memorandum, a green-loan term sheet, or a fuel-supply agreement refers to “reward units” in a Net-Zero Framework context, the substantive instrument intended is almost always the Surplus Unit as defined under regulation 30ter, with the older terminology a relic of the negotiating-cycle vocabulary. The fuel-class multiplier remains an open workstream item with no operative effect in the 2027 to 2028 compliance years.

SU issuance at the per-ship level: formula and trigger

The SU issuance computation at the per-ship level is defined in regulation 30ter and operationalised in the MEPC 83 implementing guidelines. The computation runs once per ship per compliance year, with the year aligned to the calendar year for DCS reporting purposes.

For ship $s$ in year $y$ , define:

$\text{GFI}_{\text{att},s}(y)$ : the ship’s attained well-to-wake GHG fuel intensity in gCO2eq/MJ, computed under the marine GFS methodology on the energy basis of Resolution MEPC.391(82).
$\text{GFI}_{\text{DCT}}(y)$ : the year’s Tier 2 Direct Compliance Threshold, in the same units, drawn from the GFI reduction trajectory 2027 to 2050.
$E_s(y)$ : the total well-to-wake energy delivered by all fuel consumed by the ship in year $y$ , in megajoules, computed from the DCS fuel-consumption record at the lower-calorific-value energy density of each fuel.

The SU issuance for ship $s$ in year $y$ is then:

\text{SU}_s(y) = \frac{\max(0,\ \text{GFI}_{\text{DCT}}(y) - \text{GFI}_{\text{att},s}(y)) \cdot E_s(y)}{10^6}

with $\text{SU}_s(y)$ denominated in tonnes of CO2-equivalent. The factor of $10^6$ in the denominator converts the gCO2eq numerator from grams times megajoules per megajoule, which yields grams of CO2-equivalent, into tonnes by dividing by one million.

The structure of the formula carries three substantive features. The first is the $\max(0, \cdot)$ truncation: a ship whose attained GFI exceeds the DCT earns zero SUs, never negative SUs. The negative-side liability is carried by the Tier 1 Required GFI Remediation Unit obligation, computed under regulation 29ter against a different threshold. The second is that the issuance is proportional to total energy throughput, not to deadweight, gross tonnage, or transport work. A 300,000 DWT VLCC running at 78 gCO2eq/MJ in 2030 against a DCT of, say, 71 gCO2eq/MJ earns nothing because its attained intensity is above the threshold; a 4,500 TEU container ship running at 60 gCO2eq/MJ on the same DCT earns SUs in proportion to its full annual fuel-energy consumption multiplied by an 11-unit gap. Energy throughput is the production-side variable, not the carriage-side variable. The third feature is that the issuance computation is strictly ship-specific before any pooling step. Pooling, where it occurs, is a downstream redistribution of already-issued SUs, not a smoothing of the issuance computation itself.

A worked example clarifies the magnitudes. Consider a Panamax bulk carrier in compliance year 2030. The 2030 DCT under the GFI reduction trajectory 2027 to 2050 is approximately 71 gCO2eq/MJ on the WtW basis. The ship runs primarily on B30 biodiesel blend with a verified WtW intensity of 56.4 gCO2eq/MJ for the biodiesel component and 91.6 gCO2eq/MJ for the heavy-fuel-oil residual component, weighted by energy share at 30 percent biodiesel and 70 percent residual on the energy basis, yielding a fleet-weighted attained GFI of $0.30 \times 56.4 + 0.70 \times 91.6 = 81.04$ gCO2eq/MJ. This ship is above the 2030 DCT, earns zero SUs, and surrenders Tier 2 RUs against the gap above the DCT under regulation 29ter. The ship would need to lift its biodiesel share to around 60 percent before crossing into the SU-earning region.

Consider instead a feeder container ship running on green ammonia bunkered with a verified WtW intensity of 8.4 gCO2eq/MJ across the full bunker volume, with a residual MGO consumption for pilot fuel at 91.0 gCO2eq/MJ contributing 5 percent of total energy. The energy-weighted attained GFI is $0.95 \times 8.4 + 0.05 \times 91.0 = 12.6$ gCO2eq/MJ. Against a 2030 DCT of 71 gCO2eq/MJ, the gap is 58.4 gCO2eq/MJ. With annual energy throughput of $E_s(2030) = 4.2 \times 10^8$ MJ, the SU issuance is $58.4 \times 4.2 \times 10^8 / 10^6 = 24{,}528$ tonnes CO2-equivalent of SUs.

The contrast between the two examples illustrates the design intent. The Panamax bulker on a 30 percent biodiesel blend is doing real abatement work, but its attained intensity remains above the 2030 DCT and so it earns no SUs; instead it pays a discounted Tier 2 RU rate on the corridor between the DCT and the Required GFI. The feeder container ship on green ammonia is in the SU-earning region, and the credit it earns is large in absolute tonnage because the gap to the DCT is wide and the multiplier is the full energy throughput.

Banking, vintage, and expiry of Surplus Units

A ship operator faced with the SU issuance result has three disposal options: surrender against the same year’s RU obligation of an associated ship, transfer to another party in the secondary market, or bank the SU for use in a later year. The banking rules are set in the implementing guidelines that accompany regulation 30ter and govern vintage, expiry, and transferability across compliance years.

Each SU carries a vintage stamp equal to the compliance year in which it was issued. SU vintage 2027 may be applied against the RU obligation of any ship in compliance year 2027, 2028, 2029, or 2030, but expires at the end of compliance year 2030. SU vintage 2028 expires at the end of 2031, and so on. The four-vintage-year window (issuance year plus three banking years) was the negotiated compromise between Member States that wanted unrestricted banking, on the grounds that the over-compliance signal should compound over the lifetime of an early-mover investment, and Member States that wanted a strict same-year-only rule, on the grounds that banking of credits dilutes the integrity of the annual compliance mechanism. The four-year window is shorter than the EU ETS allowance vintage, which carries unrestricted forward banking, and longer than the FuelEU Maritime pooling-credit window, which is two years.

Banking is recorded automatically on the IMO SU registry maintained by the IMO Secretariat. There is no separate banking instruction; an SU not surrendered or transferred at the end of its issuance year automatically rolls forward into the registry as a banked unit of that vintage. Banked SUs are visible to the operator in the registry and to any pool counterparties listed on the operator’s pool agreement.

Expiry is automatic on 31 December of the fourth year of vintage life. SUs that expire are written down by the registry and cannot be reinstated. The expiry is a hard cliff rather than a graduated discount, which produces an end-of-window selling pressure as expiry dates approach. Operators with large banked SU positions in years three and four of vintage life typically liquidate to the secondary market rather than carry the expiry risk; this dynamic is a recurrent topic in the BIMCO pooling clause discussions described later in the article.

The interaction between banking and pool clearing is structured to favour newer vintages. When a pool clears against an aggregate RU obligation, SUs are surrendered in first-in-first-out order by vintage, oldest vintage surrendered first. This rule prevents an operator from holding aged SUs against expiry while surrendering newer SUs against in-pool obligations, which would compound the end-of-window selling pressure. The FIFO rule is enforced at the registry layer rather than at the pool-agreement layer, so it cannot be overridden by bilateral terms.

Pooling architecture: corporate pool vs commercial pool

Pooling is the mechanism by which SUs issued to one ship may be applied against the RU obligation of another ship under the same legal arrangement. The framework recognises two pool structures with different governance, transferability, and verification rules.

The corporate pool is the simpler structure. A single legal entity, typically a shipping company or a holding-company structure for a fleet under common ownership and management, registers all of its ships under a single pool identifier on the IMO SU registry. Pool clearing within the corporate pool is automatic: SUs issued to any ship in the pool are aggregated against the RU obligations of any other ship in the same pool, with no transfer pricing, no transaction recording beyond the registry-level netting, and no counterparty consent. The corporate pool maps cleanly onto the typical IMO Document of Compliance (DOC) structure under the ISM Code, since a single Company under the DOC definition will typically be the legal entity registering the pool.

The corporate-pool architecture is administratively the lightest path, and most large fleets are expected to use it as the default. A fleet with 50 ships, of which 5 run on green ammonia and earn SUs while the other 45 run on conventional VLSFO and incur Tier 1 RU obligations, will net the SU issuance against the RU obligation at the registry level and pay the residual RU price on the net obligation only. The internal cross-subsidy between the green-ammonia ships and the conventional ships is invisible to the IMO and is governed by whatever internal accounting the operator chooses to adopt for management-accounting purposes.

The commercial pool is the more complex structure. Two or more unrelated legal entities sign a bilateral or multilateral pool agreement and register the agreement with the IMO Secretariat for inclusion in the SU registry. SUs issued to any ship in the commercial pool may be applied against the RU obligations of any other ship in the pool, but the transfer is recorded as a registry-level transaction with a transfer price agreed under the pool agreement, and the transaction is visible to the pool participants in their registry views. The commercial pool is the structure intended for cross-fleet pooling between unrelated owners, for charter-chain pooling where time-charter and voyage-charter relationships span multiple owner-operators, and for joint-venture pooling where a fuel-supply consortium aggregates the over-compliance margins of ships running on a designated fuel.

The verification rules for the commercial pool are tighter than for the corporate pool. The pool agreement must specify a designated pool administrator, a single legal entity that is responsible for instructing the IMO SU registry on transfer events. The pool administrator must be flagged in the registry and must hold a valid IMO Company identifier. The pool agreement must also specify the clearing rule: typically pro-rata-by-energy or pro-rata-by-RU-obligation, with the chosen rule binding for the duration of the pool year. Mid-year changes to the clearing rule are not permitted, although the pool agreement may be renewed annually with revised terms.

A specific subset of commercial pools, recognised at MEPC 83 but operationalised through MEPC 84 implementing guidance, is the dedicated zero-emission fuel pool. This is a commercial pool whose membership is restricted to ships running on a designated zero or near-zero GHG fuel pathway, with the pool’s purpose being to aggregate the SU issuance of a fuel-development consortium for sale to the secondary market. Dedicated pools are the structure most often referenced in the project-finance literature, since the SU revenue stream from a dedicated pool can be assigned as a security interest in green-loan documentation in a way that the SU revenue stream from a single ship typically cannot.

Transferability constraints and IMO SU registry

The Surplus Unit is a fungible, ledger-recorded instrument, but it is not freely transferable in the sense that an unregulated commodity is. Three classes of constraint apply.

The first constraint is the counterparty class restriction. SUs may be transferred only to legal entities that hold a valid IMO Company identifier and that are registered as Net-Zero Framework participants on the SU registry. This restriction excludes financial intermediaries that are not themselves shipping companies, although a shipping company affiliate of a financial group is permitted. The restriction is policy-driven: the SU is intended as a maritime-sector compliance instrument, not as a general-purpose carbon credit, and the IMO Secretariat declined at MEPC 83 to extend transferability to non-shipping participants. The practical effect is that SU secondary-market trading runs through shipping-company counterparties, with financial intermediaries operating as agents for shipping principals rather than as principals themselves.

The second constraint is the vintage match restriction at surrender. An SU of vintage $y$ may be transferred at any time during its four-vintage-year life, but at the moment of surrender against a Tier 1 RU obligation, the SU vintage must be at or before the obligation year. SU vintage 2030 cannot be surrendered against a 2027 RU obligation, although SU vintage 2027 can be surrendered against a 2030 RU obligation provided the four-year banking window has not expired. This rule prevents forward-dating of SU credits against historical obligations.

The third constraint is the flag-State notification requirement. SU transfers between commercial pool participants are reported to the flag States of both the transferring and receiving ships within 60 days of the transfer. The flag State’s role is verification of the underlying ship-level data on the transferor side, not approval of the transfer, but a flag State that identifies a discrepancy in the underlying DCS data can suspend the SU pending resolution. The notification mechanism is the principal flag-State touch point in the SU lifecycle.

The IMO SU registry itself is operated by the IMO Secretariat with a contracted technology provider, on a model similar to the EU Union Registry under the EU ETS but with substantively narrower functional scope. The registry maintains, for each registered Company:

The list of ships under the Company’s IMO identifier and their associated DOC numbers.
The annual SU issuance per ship per compliance year, computed from the verified DCS fuel-consumption record and the verified attained GFI.
The annual RU obligation per ship per compliance year, similarly computed.
The pool registrations and pool-administrator designations.
The transaction log of SU transfers, with vintage, transfer price, transferor, transferee, and pool reference where applicable.
The banked SU position per Company per vintage.

The registry is not a public-trading venue. There is no order book, no continuous price discovery, and no clearing-house function. Price discovery for SU secondary-market trading happens off-registry through bilateral negotiation, broker-mediated matching, or, for the dedicated zero-emission fuel pools, through the pool administrator’s published indicative prices. Trades execute on-registry as recorded transfers, but the price is contractual rather than market-cleared.

Verification at the IAPP renewal survey

SU issuance is verified at the IAPP (International Air Pollution Prevention) renewal survey, the five-yearly survey under the MARPOL Annex VI survey regime that confirms the ship’s continued compliance with the Annex VI requirements as a whole. The Net-Zero Framework grafts SU verification onto this existing survey rather than creating a separate annual verification event.

The annual SU issuance computation is provisional until verified at the IAPP renewal survey covering the issuance year. Provisional SUs are visible on the registry and can be banked or transferred subject to a provisional-SU discount that brokered secondary-market trades typically apply. The discount reflects the small but material risk that the IAPP renewal survey will identify a discrepancy in the underlying DCS fuel-consumption record or in the WtW attained-GFI computation, requiring a downward revision of the SU issuance.

The IAPP renewal survey for SU verification covers four substantive topics. The first is the DCS fuel-consumption record, which must be reconciled with the bunker delivery notes, the engine logbooks, the fuel-tank soundings, and the bunker-residual sampling. Discrepancies between the DCS record and the corroborating ship documents trigger a request for explanation; unresolved discrepancies trigger a downward revision of the consumption record and consequently of the SU issuance. The second is the WtW intensity of each fuel consumed during the issuance year, drawn from the LCA Guidelines default values where no certified pathway is used and from the certified pathway where the operator has elected the certified-pathway route. The auditor verifies that the certified-pathway documentation is complete, that the certifier is on the IMO accredited-certifier list, and that the ship’s fuel record matches the certified pathway by batch identifier. The third is the engine fuel-mix attribution, which becomes material when a ship runs on multiple fuels through the year; misattribution between fuel types can shift the energy-weighted attained GFI by several gCO2eq/MJ. The fourth is the pooling-arrangement attestation: where the ship is in a commercial pool, the auditor confirms that the pool agreement on file at the IMO Secretariat matches the operator’s representation and that no unreported pool changes have occurred during the issuance year.

The auditor’s verification report is filed with the IMO Secretariat within 60 days of survey completion. Provisional SUs are converted to final SUs in the registry on receipt of the verified report. Where the verified report identifies a downward revision, the registry executes a clawback against the operator’s SU position, recovering the over-issuance from the operator’s banked SUs first, then from the operator’s surrendered SUs against later-year obligations, with the operator liable to repurchase SUs from the secondary market if the clawback exceeds the operator’s available position. Clawbacks are rare in design but the framework provides for them so that operator confidence in final-SU integrity is preserved.

Secondary-market structure and project finance implications

The SU secondary market is the off-registry trading layer through which SUs move between unrelated counterparties for value. Three structural features distinguish the SU secondary market from the EU ETS allowance market and from the FuelEU Maritime pooling-credit market.

The first feature is the counterparty-class restriction described above: only IMO Company-identified shipping participants may hold SUs. The SU market is therefore narrower than the EU ETS market, where any registered participant including financial institutions, brokers, and large industrial emitters may hold allowances. The market is wider than a pure intra-company netting mechanism, since unrelated shipping companies can trade with each other, but it is structurally a B2B maritime market rather than an open commodity market.

The second feature is the administered RU price anchor. The Tier 1 RU price is set administratively by the IMO Secretariat, with the price published on a five-year forward window and reset at five-year intervals. Because the SU is surrenderable against the RU obligation at parity, the SU has a hard upper price ceiling at the RU price plus transaction costs. A buyer of SUs who could surrender RUs directly would never pay more for an SU than the RU price plus a small premium for transaction convenience; in equilibrium, SU prices trade at a modest discount to the RU price. The administered RU price anchor distinguishes the SU market from a pure free-trading allowance market and produces a much narrower price distribution. The MEPC 83 published RU price for 2027 to 2031 is in the band of USD 100 to 380 per tonne CO2-equivalent depending on the year and on the corridor (Tier 1 above the Required GFI versus Tier 2 in the corridor between the DCT and the Required GFI), and SU secondary-market prices are expected to track the Tier 1 RU price at a discount of 10 to 25 percent reflecting the bilateral-trading transaction costs.

The third feature is the vintage-aware pricing. SUs of vintage $y$ have a finite life ending at the close of vintage year $y+3$ . As a vintage approaches expiry, holders face increasing pressure to liquidate, which produces a downward bias in the price of older vintages relative to newer vintages. A typical secondary-market quote will include the vintage; the price differential between vintage 2027 quoted in mid-2030 and vintage 2030 quoted at the same time can be 30 to 50 percent, with the older vintage trading at the larger discount.

The project-finance implications follow from the secondary-market structure. A newbuild order for a green-ammonia-fuelled vessel under negotiation in 2026 for delivery in 2029 will produce SUs from delivery onward, with annual SU issuance in the order of 20,000 to 35,000 tonnes per ship per year for a 4,500 to 6,000 TEU container ship running on green ammonia at a 2030 DCT gap of 55 to 60 gCO2eq/MJ. At an SU price of USD 200 per tonne (a mid-range estimate against the published RU price band), the gross SU revenue is USD 4 million to USD 7 million per ship per year. A ten-year SU revenue stream discounted at a project-finance cost of capital of 8 percent produces a present-value contribution of USD 27 million to USD 47 million per ship, against a typical newbuild capex of USD 180 million to USD 220 million for a vessel of this size. The SU revenue stream is therefore a material 13 to 25 percent contribution to the newbuild business case, and most green-ammonia newbuild project-finance memoranda being written in 2025 to 2026 explicitly model the SU revenue stream as an assignable receivable under the security package.

The principal project-finance friction is the uncertainty in the long-dated RU price. The IMO Secretariat publishes the RU price five years forward, which provides reasonable visibility for years 2027 through 2031, but the post-2031 price is unknown at the time the financing is arranged in 2026. Project-finance memoranda typically apply a 30 to 40 percent haircut to the long-dated SU revenue stream to reflect this uncertainty, with the haircut narrowing as the IMO publishes successive five-year windows.

A second project-finance consideration is the assignability of the SU revenue stream. The IMO SU registry permits transfer of SUs only to IMO Company-identified counterparties, which complicates a security-trustee arrangement where a non-shipping financial institution is the secured party. The workaround in current green-loan documentation is the appointment of a shipping-company affiliate of the financial group as the registered transferee of last resort, with the affiliate holding the SUs in trust for the secured creditors and transferring the SUs to a market counterparty on instruction. This structure adds approximately 40 to 60 basis points to the all-in cost of the financing relative to a pure commodity-credit assignment, but it is workable in the current project-finance market.

Comparison with FuelEU pooling and EU ETS allowance trading

The IMO SU pooling architecture sits alongside two pre-existing European mechanisms that operate on overlapping voyages: FuelEU Maritime pooling under Regulation (EU) 2023/1805, and EU ETS allowance trading under Directive 2003/87/EC as amended for maritime. The three mechanisms differ in granularity, transferability, and pricing structure.

FuelEU Maritime pooling, as elaborated in the FuelEU pooling article, permits a ship in over-compliance against the FuelEU GHG-intensity limit to share its over-compliance margin with one or more under-compliant ships in a registered pool. The pool is registered with the verifier and reported to the European Commission’s THETIS-MRV system. Pool clearing is annual on the FuelEU compliance year, which aligns to the calendar year. The FuelEU pool structure permits both intra-company and inter-company pooling, with no class restriction on the participants beyond the requirement that the participating ships be subject to FuelEU. The FuelEU pool credit, denominated in grams of CO2-equivalent, is not transferable outside the pool in the sense that there is no secondary market and no banking beyond a two-year window. A FuelEU pool credit that is unused at the end of two years expires.

The IMO SU mechanism is broader on three dimensions. The transferability is broader: SUs can be transferred between any two IMO Company-identified counterparties, not just within a pre-registered pool, although the transferability is subject to the counterparty-class restriction discussed earlier. The banking window is longer at four vintage years against FuelEU’s two. The denomination is in tonnes of CO2-equivalent rather than grams, which produces a more financialised credit and a more developed secondary market. The geographical scope is global rather than the European-voyage subset.

The IMO SU mechanism is narrower than FuelEU on one dimension: the issuance trigger requires direct compliance below the DCT, which is the tighter of the two GFI thresholds. FuelEU’s over-compliance trigger is the FuelEU limit itself (a single threshold), with no inner tighter threshold for credit issuance. As a consequence, a ship that is over-compliant on the FuelEU limit but above the IMO DCT will earn FuelEU pool credits but not IMO SUs, even on European voyages where both regimes apply.

The EU ETS comparison is structurally different. EU ETS allowances are not over-compliance credits at all; they are mandatory allowances issued to (or auctioned to) the regulated operator, with the obligation to surrender allowances equal to verified emissions. There is no concept of over-compliance issuance under EU ETS. Allowance pooling in the maritime context refers instead to the sharing of the surrender obligation between counterparties, typically between a shipowner and a charterer under a charter-party clause that allocates the EU ETS surrender cost between the parties.

The three mechanisms interact in compliance years where a ship makes European voyages subject to FuelEU and EU ETS, and is also subject to the IMO Net-Zero Framework on its global activity. A ship running on green ammonia on a Rotterdam to Singapore route in 2030 will earn IMO SUs on the global emissions, FuelEU pool credits on the European-voyage subset of the emissions, and reduced EU ETS allowance surrender obligation reflecting the lower scope-1 CO2 emissions from the green-ammonia combustion. The three credits are independent, denominated differently, transferable under different rules, and surrenderable against different obligations. The GFI compliance calculator covers the IMO leg; the FuelEU pooling calculator and FuelEU pooling credit calculator cover the FuelEU leg; the EU ETS pool surrender calculator covers the EU ETS leg.

BIMCO pooling agreement template (2024-2025 work)

BIMCO began work in mid-2024 on a standard-form pool agreement template for use by IMO Net-Zero Framework participants, in parallel with the MEPC 83 negotiation. The first complete draft of the template, designated the BIMCO Net-Zero Pool Agreement 2025, was circulated for industry consultation in late 2025 and is expected to be finalised in mid-2026 after the MEPC 84 implementing guidance on pool clearing rules is published.

The template is a multi-party agreement framework with six structural clauses.

The pool composition clause lists the participating Companies and their ships, with an annex updated quarterly to reflect ship deletions and additions, and a notification mechanism to the IMO SU registry that mirrors the registry’s pool-membership requirement. The clause distinguishes between founding members (parties who signed the original agreement) and acceding members (parties who joined later under an accession deed), with different exit rights between the two classes.

The clearing rule clause specifies the rule by which SUs issued to over-complying ships are allocated against the RU obligations of under-complying ships in the pool. The template offers three pre-drafted clearing rules: pro-rata-by-energy, pro-rata-by-RU-obligation, and weighted-average-with-floor. The pro-rata-by-energy rule is the simplest and is the default in most consultation responses; the weighted-average-with-floor rule preserves a minimum SU retention by the over-complying ship’s Company, which is preferred where the over-complying ship’s Company has secured project-finance debt against the SU revenue stream.

The transfer pricing clause specifies the price at which SUs move between participating Companies under the pool agreement. The template defaults to the administered RU price minus a discount, with the discount as a negotiated parameter, but it permits an alternative market-reference-price formula tied to a published broker index. The transfer pricing clause is the principal commercial term and is typically the most-negotiated clause in any specific agreement.

The default and exit clause governs the consequences of a pool member’s failure to meet its obligations, including failure to provide its share of the pool’s RU obligation funding, failure to deliver SUs into the pool that the member’s ships are forecast to issue, or insolvency. The template provides for a four-week cure period followed by automatic exit, with the exiting member’s residual SU position frozen at the IMO registry pending settlement of the inter-member obligations.

The governance clause establishes the pool administrator role, the voting rules among participating Companies, and the procedure for amending the pool agreement. The template specifies one-vote-per-Company for ordinary amendments and unanimous consent for changes to the clearing rule, the transfer pricing clause, or the default and exit clause.

The dispute resolution clause is BIMCO’s standard London-arbitration template, with the LMAA Terms applicable, and a fast-track sub-procedure for SU-clearing disputes that need resolution before the next IAPP renewal survey verification window.

The BIMCO template is not mandatory; pool participants are free to negotiate any agreement form that meets the IMO SU registry’s procedural requirements. The template’s value is the standardisation of the boilerplate clauses, which reduces the legal-fee burden of pool formation and improves the comparability of pool terms for project-finance lenders evaluating the credit quality of the SU revenue stream as security.

Formula, assumptions, and limits

Formula

For a ship $s$ in compliance year $y$ , the per-ship Surplus Unit issuance is:

\text{SU}_s(y) = \frac{\max(0,\ \text{GFI}_{\text{DCT}}(y) - \text{GFI}_{\text{att},s}(y)) \cdot E_s(y)}{10^6}

with $\text{SU}_s(y)$ in tonnes CO2-equivalent, the GFI terms in gCO2eq/MJ, and $E_s(y)$ in MJ. The pool-clearing rule that aggregates issuance against obligation is:

\sum_{s \in P} \text{SU}_s(y) - \sum_{s \in P} \text{RU}_s(y) = \text{Pool surplus}(y)

where $P$ is the pool, $\text{RU}_s(y)$ is the per-ship Tier 1 Remediation Unit obligation under regulation 29ter, and Pool surplus( $y$ ) is the net pool position after intra-pool netting. A positive pool surplus is bankable or transferable; a negative pool surplus must be funded by the purchase of SUs from the secondary market or by the surrender of RUs at the administered IMO price.

Derivation

The per-ship formula derives from the regulatory definition of the SU as an over-compliance credit denominated in absolute tonnage of CO2-equivalent. The derivation has four steps.

Step one: define the per-MJ over-compliance margin as the gap between the DCT and the attained GFI, in gCO2eq/MJ, truncated at zero. This is $\Delta_s(y) = \max(0, \text{GFI}_{\text{DCT}}(y) - \text{GFI}_{\text{att},s}(y))$ with units of gCO2eq/MJ.

Step two: multiply the per-MJ margin by the total energy throughput to convert the gCO2eq/MJ intensity gap into total gCO2eq tonnage. This is $\Delta_s(y) \cdot E_s(y)$ with units of $(\text{gCO2eq}/\text{MJ}) \times \text{MJ} = \text{gCO2eq}$ .

Step three: convert grams of CO2-equivalent to tonnes by dividing by $10^6$ , yielding $\text{SU}_s(y) = \Delta_s(y) \cdot E_s(y) / 10^6$ in tonnes CO2-equivalent.

Step four: the pool clearing identity is a simple accounting sum across pool members, with intra-pool transfers netting to zero and the residual being the pool’s net market position.

Assumptions

Five assumptions are baked into the formula.

The first is that the WtW intensity is the operative metric. SU issuance is on a well-to-wake basis, not a tank-to-wake basis, and the upstream emissions of the fuel are credited or debited to the ship’s attained GFI through the LCA Guidelines pathway. A ship using fossil LNG with high upstream methane slip has a higher WtW attained GFI than a ship using e-LNG produced from green hydrogen, even though their tank-to-wake combustion CO2 is similar.

The second is that the DCT is fleet-uniform. Every ship of 5,000 GT or above engaged on international voyages faces the same DCT in a given year, regardless of ship type, age, deadweight, or operating profile. There is no DCT differentiation by ship category, in contrast to the Carbon Intensity Indicator framework where the rating thresholds are differentiated by ship type.

The third is that the energy basis is lower calorific value as specified in MEPC.391(82). All fuel-energy denominators in the GFI computation are LCV-energy, not higher calorific value. This convention is shared with the EU MRV system but differs from some industry conventions that report HCV-energy.

The fourth is that the DCS fuel-consumption record is verified. The SU issuance computation depends on the DCS record being a faithful representation of the ship’s actual fuel consumption. The IAPP renewal survey is the principal verification mechanism, with provisional-SU discounting in the secondary market reflecting the residual uncertainty before verification.

The fifth is that the pool clearing is annual. There is no continuous netting; SUs and RUs accumulate during the year and net once at year-end. This convention simplifies the registry implementation but produces a year-end concentration of pool-clearing activity that strains the registry infrastructure during the December to March window each year.

Worked example

Consider a corporate pool of three ships under a single Company in compliance year 2030.

Ship A is a 6,500 TEU container ship running on green ammonia. WtW attained GFI is 12.6 gCO2eq/MJ. Annual energy throughput is $E_A(2030) = 5.4 \times 10^8$ MJ. Against the 2030 DCT of 71 gCO2eq/MJ, the gap is 58.4 gCO2eq/MJ, and the SU issuance is $58.4 \times 5.4 \times 10^8 / 10^6 = 31{,}536$ tonnes CO2-equivalent.

Ship B is a 5,000 TEU container ship running on B30 biodiesel blend. WtW attained GFI is 81.0 gCO2eq/MJ. Against the 2030 DCT of 71 and the 2030 Required GFI of approximately 80.5 (a Tier 1 trajectory value), the ship is just above the Required GFI, with a gap of 0.5 gCO2eq/MJ above the Required threshold. Annual energy throughput is $E_B(2030) = 4.8 \times 10^8$ MJ. The Tier 1 RU obligation is $0.5 \times 4.8 \times 10^8 / 10^6 = 240$ tonnes CO2-equivalent.

Ship C is a 4,500 TEU container ship running on conventional VLSFO. WtW attained GFI is 91.4 gCO2eq/MJ. Against the 2030 Required GFI of 80.5, the gap is 10.9 gCO2eq/MJ. Annual energy throughput is $E_C(2030) = 4.2 \times 10^8$ MJ. The Tier 1 RU obligation is $10.9 \times 4.2 \times 10^8 / 10^6 = 4{,}578$ tonnes CO2-equivalent.

Pool clearing: $\sum \text{SU}_s = 31{,}536$ tonnes; $\sum \text{RU}_s = 240 + 4{,}578 = 4{,}818$ tonnes. Pool surplus = $31{,}536 - 4{,}818 = 26{,}718$ tonnes CO2-equivalent. The Company nets the SUs from Ship A against the RU obligations of Ships B and C, surrendering the netted obligation against the Company’s SU position with the registry. The residual 26,718 tonnes of SUs are banked for vintage 2030 with expiry in December 2033, available for transfer or for surrender against future-year obligations of Ships B and C.

Edge cases and limits

Five edge cases recur in operational practice.

The provisional-versus-final SU divergence arises where the IAPP renewal survey identifies a downward revision to the DCS fuel-consumption record after the operator has already transferred provisional SUs to a secondary-market counterparty. The clawback mechanism described earlier resolves the divergence at the registry level, but the operator faces a real-economy cost of repurchasing SUs at potentially-higher market prices to satisfy the clawback.

The fuel-mix attribution dispute arises where a ship runs on multiple fuels through the year and the auditor disputes the operator’s attribution of fuel batches to engines and operations. A 5 percent attribution shift between high-intensity residual fuel and low-intensity biofuel can shift the energy-weighted attained GFI by 1.5 to 3 gCO2eq/MJ, which on a multi-hundred-thousand-MJ throughput moves the SU issuance by hundreds to low thousands of tonnes.

The cross-jurisdictional double-counting arises where an operator earns FuelEU pool credits and IMO SUs on the same European-voyage emissions. The two regimes are technically independent, with no formal acknowledgment of double-counting in either, but several Member State submissions to MEPC 84 have proposed an offset mechanism whereby a ship that surrenders against one regime would receive a partial offset against the other. No offset has been adopted in the operative MEPC 83 framework.

The pool exit mid-year arises where a participating Company in a commercial pool exits the pool partway through the compliance year, either by sale of the participating ships, by insolvency, or by negotiated exit. The IMO registry handles the mid-year exit by computing pro-rata SU and RU positions to the exit date, freezing the exiting member’s positions, and continuing pool clearing on the residual membership. The frozen positions are settled bilaterally between the exiting member and the residual pool, typically under the BIMCO template’s default-and-exit clause.

The vintage expiry concentration arises in the third and fourth years of any vintage’s life, when remaining holders of the vintage face increasing pressure to liquidate before expiry. The FIFO pool-clearing rule produces an automatic liquidation effect against in-pool obligations, but holders with no in-pool obligation must rely on the secondary market for liquidation. Late-stage vintages typically trade at 30 to 50 percent discounts to current vintages, reflecting the expiry pressure.

The principal limit of the SU framework is that it is administratively priced rather than market priced. The administered RU price ceiling caps the SU price below the RU price, which preserves IMO control over the cost of compliance but produces a much narrower price-discovery margin than a free-trading allowance market. Operators looking to the SU revenue stream for project-finance support have to model the long-dated RU price under the IMO’s published five-year forward window, with substantial uncertainty in the post-window years that produces project-finance haircuts of 30 to 40 percent on the long-dated revenue stream.

Regulatory basis

The SU instrument is created by regulation 30ter of MARPOL Annex VI Chapter 4 ter, with the issuance computation and the verification rules elaborated in the implementing guidelines accompanying the regulation. The pool architecture is set out in implementing-guidance documents adopted at MEPC 83 and amplified at MEPC 84. The IMO SU registry is operated under terms set in the implementing guidance, with the IMO Secretariat as the operating authority and a contracted technology provider on an arm’s-length services agreement.

The instrument operates against the Tier 1 Required GFI under regulation 29ter and the Tier 2 Direct Compliance Threshold under regulation 30ter, with the trajectory of both thresholds drawn from the GFI reduction trajectory 2027 to 2050. The DCS reporting infrastructure under regulations 27 and 28 of MARPOL Annex VI Chapter 4 supplies the underlying fuel-consumption data, and the LCA Guidelines under Resolution MEPC.391(82) supply the WtW intensity values. The fund into which RU revenues flow, and from which targeted disbursements are made, is the IMO Net-Zero Fund established under regulation 31ter.

Common errors

Five common errors recur in early-cycle implementation and in industry interpretation.

The first is conflating SU with RewU and assuming a fuel-class multiplier. The MEPC 83 SU is a direct-over-compliance credit only; the proposed RFNBO-equivalent fuel-class multiplier was deferred to the MEPC 86 review workstream and is not in the operative 2027 to 2031 framework.

The second is using gross tonnage or deadweight rather than energy throughput in the issuance computation. The denominator in the SU computation is total annual energy throughput in MJ, not a tonnage measure.

The third is applying the SU formula on a tank-to-wake basis. The framework is well-to-wake throughout, and the LCA Guidelines pathway upstream emissions are included in the attained GFI and consequently in the SU issuance.

The fourth is assuming that SU transfers can run through any financial counterparty. The IMO Company-identifier counterparty-class restriction limits transfer to maritime participants, and project-finance security arrangements need to accommodate the restriction through an affiliate-trustee structure.

The fifth is treating the SU vintage as unlimited-life. The four-vintage-year window (issuance year plus three banking years) is firm, with FIFO surrender and hard-cliff expiry. Operators holding aged vintages near expiry need to plan liquidation rather than carry the expiry risk.

Strategic implications: when to over-comply

The SU mechanism creates a structured incentive to over-comply with the Required GFI by lifting the attained GFI below the DCT. The strategic question facing any operator is whether the over-compliance investment, typically a fuel-switching or ship-design choice, produces a net-present-value gain after accounting for the incremental fuel cost, the SU revenue stream, and the regulatory-risk discount.

A conservative framing of the question runs as follows. The operator computes the incremental fuel-cost premium of the over-compliance fuel pathway against the conventional fuel pathway, on a per-MJ basis. For a green-ammonia versus VLSFO comparison in 2030, the incremental premium is in the band of USD 700 to USD 1,200 per tonne CO2-equivalent of avoided emissions, depending on green-ammonia supply development. The operator computes the SU revenue per tonne of avoided emissions as the SU price (typically USD 150 to USD 300 per tonne in the 2027 to 2031 window), which offsets the incremental premium by a corresponding amount.

The remaining gap between the incremental fuel-cost premium and the SU revenue is the net abatement cost that the operator funds from cargo rates, from cost reductions elsewhere, or from third-party support such as a carbon-contract-for-difference arrangement with a fuel supplier. If the net abatement cost is below the operator’s cost-of-carbon hurdle for the vessel’s commercial market, over-compliance pencils. If it is above the hurdle, over-compliance does not pencil and the operator stays in the corridor between the DCT and the Required GFI, paying the discounted Tier 2 RU rate on the corridor gap.

The strategic decision interacts with three commercial factors. The first is the charterer demand for low-emission tonnage, which can lift the achievable freight rate for a green-ammonia or e-methanol vessel by 10 to 30 percent on selected trades, reducing the net abatement cost. The second is the green-loan financing premium, which can reduce the all-in cost of financing for an over-compliant newbuild by 50 to 150 basis points relative to a conventional newbuild, similarly reducing the net abatement cost. The third is the regulatory-future option value: an over-compliant vessel preserves operating optionality across multiple post-2031 RU price scenarios, which has significant present value under uncertainty about the IMO’s five-year-forward RU price publications. A vessel built today as direct-compliant in 2030 is robust against RU price increases through 2040; a vessel built today as conventional is exposed to the full RU price across the same period.

The over-compliance decision is therefore a cross-commercial decision spanning fuel cost, freight rate, financing cost, and regulatory option value. The SU mechanism is the explicit incentive layer in the regulatory framework, but it is not the whole decision. Operators evaluating the question for newbuilds in the 2026 to 2028 ordering window typically build a discounted-cash-flow model that includes all four components, and the over-compliance decision rests on the integrated NPV across the components rather than on the SU mechanism in isolation.