Commission Delegated Regulation (EU) 2025/723 of 6 February 2025 supplementing Directive 2003/87/EC of the European Parliament and of the Council by laying down detailed rules for the yearly calculation of price differences between eligible aviation fuels and fossil kerosene and for the EU ETS allocation of allowances for the use of eligible aviation fuels

• CELEX: Delegated Regulation (EU) 2025/723
• Articles: 10

Article 1 Subject-matter and scope

1.   This Regulation lays down rules for the yearly calculation of the price differences between eligible aviation fuels and fossil kerosene and for the allocation of allowances pursuant to Article 3c(6) of Directive 2003/87/EC for the use of eligible aviation fuels by commercial aircraft operators from 1 January 2024 until 31 December 2030.

2.   Commercial aircraft operators may apply for allocation in respect of eligible aviation fuels reported in accordance with Article 54a of Implementing Regulation (EU) 2018/2066 and used on the following subsonic flights:

(a)

flights for which allowances have to be surrendered in accordance with Article 12(3) of Directive 2003/87/EC;

(b)

flights covered by Article 3c(8) of Directive 2003/87/EC.

Article 2 Definitions

For the purposes of this Regulation, the following definitions apply:

(1)

‘commercial aircraft operator’ means commercial air transport operator as defined in Article 3, point (p) of the Directive 2003/87/EC;

(2)

‘eligible aviation fuel’ means fuel types eligible for the support under Article 3c(6) of Directive 2003/87/EC;

(3)

‘harmonised minimum levels of taxation’ means the minimum levels of taxation applicable to fossil kerosene and eligible aviation fuels set out in Council Directive 2003/96/EC  ( 6 ) ;

(4)

‘EASA technical report’ means the technical report published by the European Union Aviation Safety Agency referred to in Article 13 of Regulation (EU) 2023/2405.

Article 3 Application for allowances for the use of eligible aviation fuels by commercial aircraft operators

1.   Commercial aircraft operators shall apply for allocation of allowances for the use of eligible aviation fuels by reporting the verified amounts of eligible aviation fuels used in the preceding reporting year in their annual emissions report, in accordance with Article 54a of Implementing Regulation (EU) 2018/2066.

2.   Where commercial aircraft operators decide not to apply for allocation of allowances for the use of eligible aviation fuels, they shall indicate that decision in the annual emissions report.

3.   The application shall be valid provided that the annual emissions report is submitted to the competent authority by 31 March of the subsequent year after the reporting period pursuant to Article 68(1) of Implementing Regulation (EU) 2018/2066.

Article 4 Yearly calculation of the average price differences between eligible aviation fuels and fossil kerosene

1.   The average price difference between eligible aviation fuel and fossil kerosene for a given year shall be calculated as follows:

Price difference(y) = price of eligible aviation fuel(y) – (price of fossil kerosene + ETS price + difference in taxation(y))

where:

Price of eligible aviation fuel(y)

=

price of eligible aviation fuel y or eligible aviation fuel subcategory y listed in the Annex determined in accordance with paragraph 2, in EUR per tonne;

Price of fossil kerosene

=

price of fossil kerosene Jet A1 determined in accordance with paragraph 4, in EUR per tonne;

ETS price

=

the price of using fossil kerosene pursuant to Directive 2003/87/EC determined in accordance with paragraph 5, in EUR per tonne;

Difference in taxation(y)

=

difference between the harmonised minimum levels of taxation on fossil kerosene and the eligible aviation fuel y, in EUR per tonne.

2.   The price of eligible aviation fuels shall be determined for specific eligible aviation fuels where available, and as a minimum for the eligible aviation fuel subcategories listed in the Annex as follows:

(a)

where the market price is available in the EASA technical report, the price shall be the market price published in that report;

(b)

where the market price is not available in the EASA technical report, the price shall be determined as follows:

(i)

where prices reported in accordance with Article 5 that cover at a minimum 25 % of the total amount of that eligible aviation fuel or the subcategory reported by all commercial aircraft operators in that reporting period are available, the price shall be the weighted average price of the reported prices for the operators who reported the prices in accordance with Article 5; for operators that did not report the prices in accordance with Article 5, the price shall be the minimum selling price determined in accordance with paragraph 3 of this Article;

(ii)

where prices reported in accordance with Article 5 that cover at a minimum 25 % of the total amount of that eligible aviation fuel or the subcategory reported by all commercial aircraft operators in that reporting period are not available, the price shall be the minimum selling price determined in accordance with paragraph 3 of this Article.

3.   The Commission shall determine the minimum selling price based on the best data available and taking into account relevant information available in the EASA technical report on production cost estimates and shall apply an additional margin of 10 %.

4.   The price of fossil kerosene shall be the price published or to be published in the EASA technical report. If the prices are not available in the EASA technical report published or to be published by the time the Commission publishes the price differences in accordance with paragraph 7, the price of fossil kerosene shall be based on the best data available to the Commission.

5.   The ETS price shall be calculated to two decimal places using the following formula:

ETS price = fossil kerosene emissions factor × price of ETS emission allowance

where:

Fossil kerosene emissions factor

=

emission factor of jet kerosene as set out in Table 1 of Annex III to Implementing Regulation (EU) 2018/2066;

Price of ETS emission allowance

=

the average price of emission allowances determined as the weighted average price of auctions carried out in accordance with delegated acts adopted pursuant to Article 10(4) of Directive 2003/87/EC during the previous calendar year as published on the common auction platform, in EUR per allowance;

The ETS price shall be zero where the eligible aviation fuel is not zero-rated in accordance with Article 54c of Implementing Regulation (EU) 2018/2066 and where the eligible aviation fuel is reported on flights under point (b) of Article 1(2).

6.   Where prices are not available in euro, the yearly average of the exchange rates published by the European Central Bank shall be used for the currency exchange.

7.   Each year by 31 May, the Commission shall publish in the Official Journal of the European Union the price difference for the previous calendar year calculated in accordance with this Article, and the values of all the elements of the formula set out in paragraph 1.

Article 5 Reporting of actual prices paid by commercial aircraft operators

1.   For eligible aviation fuels used from 1 January 2025, by 28 February of each year starting in 2026, a commercial aircraft operator may report to the Commission the actual prices paid for the fuel used in the previous calendar year. Where an operator chooses to report actual prices, the operator shall provide the following together with the report:

(a)

sufficient documentation, including contracts and invoices, linking the eligible aviation fuel to the commercial aircraft operator and indicating all the airports where the eligible aviation fuel was delivered and reported;

(b)

evidence that the full amount of the reported eligible aviation fuel is covered by the contracts and invoices provided, at all locations where the eligible aviation fuel concerned is uplifted.

The Commission may conclude not to consider reported prices for determining the eligible aviation fuel price in accordance with Article 4(2) from a commercial aircraft operator where the submitted evidence is insufficient or lacks credibility.

2.   The Commission shall ensure that the data and evidence submitted in accordance with paragraph 1 is treated in a confidential manner.

3.   By way of derogation from paragraph 2, where only one or two commercial aircraft operators report the actual prices paid for an eligible aviation fuel, the Commission shall take the reported prices into account only if the commercial aircraft operators waive confidentiality requirements.

The Commission shall inform the commercial aircraft operators concerned as soon as possible after the reporting deadline when only one or two commercial aircraft operators reported the actual prices paid for an eligible aviation fuel and shall request a written waiver of confidentiality. Where the concerned commercial aircraft operators do not provide the requested waiver within 15 working days from the request, the reported prices shall not be taken into account in the calculation of the price difference in accordance with Article 4.

4.   By 30 April each year the Commission shall inform the Member States which commercial aircraft operators have submitted the reported prices.

5.   The provisions in this Delegated Regulation shall be without prejudice to the application of Union competition law.

Article 6 Calculation of the amount of allowances to be allocated to commercial aircraft operators

1.   Competent authorities shall determine the demand for allowances for each commercial aircraft operator they administer. The demand shall be calculated as the sum of the demand for each eligible aviation fuel or eligible aviation fuel subcategory listed in the Annex, for which price was determined pursuant to Article 4(2), determined in accordance with paragraph 2 or paragraph 3, as applicable, and rounded down to the nearest integer.

2.   The demand for allowances allocated for the use of each eligible aviation fuel or eligible aviation fuel subcategory listed in the Annex, for which price was determined pursuant to Article 4(2), which were uplifted at airports identified in Article 3c(6), third subparagraph, point (c), of Directive 2003/87/EC shall be determined for each commercial aircraft operator using the following formula:

where:

Fuel used(y)

=

amount of neat eligible aviation fuel y or eligible aviation fuel subcategory y listed in the Annex as reported in the annual emissions report, in tonnes;

Price difference(y)

=

price difference between the eligible aviation fuel y or eligible aviation fuel subcategory y listed in the Annex and fossil fuel, as determined in accordance with Article 4(1), in EUR per tonne;

Allowance price

=

the average price of allowances as determined in accordance with Article 4(5), in EUR per allowance.

3.   The demand for allowances allocated for the use of each eligible aviation fuel or eligible aviation fuel subcategory listed in the Annex, for which price was determined pursuant to Article 4(2), which were uplifted at airports other than the airports identified in Article 3c(6), third subparagraph, point (c), of Directive 2003/87/EC shall be determined for each commercial aircraft operator using the following formula:

where:

Fuel used(y)

=

amount of neat eligible aviation fuel y or eligible aviation fuel subcategory y listed in the Annex as reported in the annual emissions report, in tonnes;

Price difference(y)

=

price difference between the eligible aviation fuel category y or eligible aviation fuel subcategory y listed in the Annex and fossil fuel, as determined in accordance with Article 4(2), in EUR per tonne;

Allowance price

=

the average price of allowances as determined in accordance with Article 4(5), in EUR per allowance;

Level of EU ETS support(y)

=

share of the price difference to be covered for eligible aviation fuel category y as specified in Article 3c(6), third subparagraph, of Directive 2003/87/EC.

4.   By 15 June each year competent authorities shall notify to the Commission the following information for each commercial aircraft operator that has applied for the allocation:

(a)

name and ETS ID of the commercial aircraft operator;

(b)

the amount of eligible aviation fuel per category covered by the application, in tonnes;

(c)

the demand for allocation of allowances calculated in accordance with paragraphs 1, 2 and 3.

5.   The Commission shall aggregate the total demand for allocation of allowances and shall assess whether the demand in a particular year is not higher than the amount of allowances remaining from the amount reserved for this purpose in accordance with Article 3c(6) of Directive 2003/87/EC.

Where the total demand for allocation of allowances in a particular year is higher than the availability of allowances, the Commission shall calculate an allocation reduction factor. That factor shall be applied in a uniform manner to all commercial aircraft operators concerned by the allocation for that year to determine the final allocation of allowances for each commercial aircraft operator. The allocation reduction factor shall be calculated using the following formula:

The Commission shall inform the competent authorities when the application of an allocation reduction factor is necessary and shall indicate the value of the calculated reduction factor. Based on that information, the competent authorities shall recalculate the final allocation per commercial aircraft operator and notify it to the Commission.

The final allocation per commercial aircraft operator shall be rounded down to the nearest integer.

6.   By 31 August each year, the Commission shall adopt a Decision indicating the allocation of allowances per commercial aircraft operator based on the notifications received, shall inform the relevant competent authorities and shall introduce the changes, where appropriate, into the Union Registry set up pursuant to Article 19 of Directive 2003/87/EC and the transaction log, referred to in Article 20 of that Directive.

Article 7 Correction procedure

1.   Where corrections to the amount of allowances included in the Decision pursuant to Article 6(6) of this Regulation are necessary, such corrections shall be carried out by using allowances from, or by returning allowances to, the amount of allowances reserved in accordance with Article 3c(6) of Directive 2003/87/EC.

2.   Where, in accordance with paragraph 1 of this Article, allowances need to be used from the amount of allowances reserved in accordance with Article 3c(6) of Directive 2003/87/EC and there are no such allowances remaining, the correction requiring additional allowances shall not be carried out.

Article 8 Visibility

Commercial aircraft operators receiving support under this Regulation shall be subject to the following obligations:

(a)

shall acknowledge the origin of the support and ensure the visibility of the Union support, in particular when promoting the use of alternative fuels and the results from this use, by providing coherent, effective and targeted information to various audiences, including to passengers, the media and the public, and in the commercial aircraft operator’s sustainability statements and annual reports;

(b)

shall use, for all communication and knowledge-sharing activities, including on passenger tickets, and on notice boards at strategic places visible to the public, the label that reads ‘(co-)funded by the EU Emissions Trading System’, as well as the emblem of the Union and the amount of support.

Article 9 Entry into force

This Regulation shall enter into force on the third day following that of its publication in the Official Journal of the European Union .

Schedules & Appendices

ANNEX ELIGIBLE AVIATION FUEL SUBCATEGORIES

ANNEX

ELIGIBLE AVIATION FUEL SUBCATEGORIES

Eligible aviation fuel subcategory

Level of direct EU ETS support laid down in Article 3c(6), third subparagraph, of Directive 2003/87/EC  ( 1 )

Details

1

Renewable fuels of non-biological origin

95  %

Drop-in renewable fuels of non-biological origin as defined in Article 2, point (36), of Directive (EU) 2018/2001 and that are certified in compliance with Article 30 of that Directive

2

Co-processed renewable fuels of non-biological origin

95  %

Co-products in a conventional refinery that are drop-in renewable fuels of non-biological origin as defined in Article 2, point (36), of Directive (EU) 2018/2001 and that are certified in compliance with Article 30 of that Directive

3

Advanced aviation biofuels

70  %

Biofuels produced from the feedstock listed in Part A of Annex IX to Directive (EU) 2018/2001 and that are certified in compliance with Article 30 of that Directive

4

Advanced co-processed fuels

70  %

Co-products in a conventional refinery produced from the feedstock listed in Part A of Annex IX to Directive (EU) 2018/2001 and that are certified in compliance with Article 30 of that Directive

5

Renewable hydrogen for aviation

70  %

Renewable hydrogen for aviation as defined in Article 3, point (16), of Regulation (EU) 2023/2405

6

Aviation biofuels

50  %

Biofuels produced from feedstock listed in Part B of Annex IX to Directive (EU) 2018/2001 and that are certified in compliance with Article 30 of that Directive

7

Other aviation biofuels

50  %

Biofuels produced from the feedstock not listed in Annex IX to Directive (EU) 2018/2001 and not produced from food and feed crops, and that are certified in compliance with Article 30 of that Directive

8

Non-fossil low-carbon hydrogen for aviation

50  %

Low-carbon hydrogen for aviation as defined in Article 3, point (15), of Regulation (EU) 2023/2405 that is not derived from fossil fuels

9

Non-fossil synthetic low-carbon aviation fuels

50  %

Synthetic low-carbon aviation fuels as defined in Article 3, point (13), of Regulation (EU) 2023/2405 that is not derived from fossil fuels

10

Co-processed fuels

50  %

Co-products in a conventional refinery other than advanced co-processed fuels and that are certified in compliance with Article 30 of Directive (EU) 2018/2001

( 1 )   Level of support except where the fuel is uplifted at an airport identified in Article 3c(6), third subparagraph, point (c), of Directive 2003/87/EC, where the level of support is 100 %.