"RED III raises the bar for renewable energy across Europe, and the maritime sector is firmly in scope. The introduction of multipliers and RFNBO targets reflects the EU’s intent to drive real change in ship fuel choices. But the patchwork of national implementations means that navigating the consequences on the European market will benefit significantly from expert insight, not just an awareness of the headline targets.”
Mark Tamsitt, Senior Vice President, Global Marine Sales at World Fuel.
In 2023, the European Union’s strategy to incentivise renewable energy was further embedded with a major update to the Renewable Energy Directive, known as RED III. While this directive doesn’t place direct responsibilities on shipping, it does have a material impact on European fuel markets and is therefore an important consideration when building bunker procurement strategies or planning retrofits and newbuild campaigns. Understanding the directive’s structure, its targets, and the uneven pace at which member states are putting it into effect is essential for any operator managing a compliance strategy in European waters.
This article is the first in a two-part mini-series on RED III. In this part, World Fuel addresses three foundational questions: What is RED III? What are the renewable energy targets it sets? And, where does implementation currently stand across the EU? The second article in the series then considers the implications for the maritime sector, examining what all of this means commercially for shipping companies, their fuel buyers, and the supply chains that serve them.
What is RED III?
RED III is the shorthand for Directive (EU) 2023/2413, which amends and substantially strengthens the 2018 Renewable Energy Directive, commonly referred to as RED II. Adopted by the European Parliament and Council in October 2023 and entering into force on 20 November that year, it forms a cornerstone of the European Green Deal and the REPowerEU agenda, which was designed in part to reduce the EU’s energy dependence following Russia’s invasion of Ukraine.
The directive sets binding and indicative targets for renewable energy across the whole EU economy, covering power generation, industry, heating and cooling, buildings, and transport. Member states were required to transpose most provisions into national law by 21 May 2025, though in practice this process is proceeding at different speeds in different countries, a point we will return to shortly.
For the maritime sector specifically, RED III matters for several interconnected reasons. It raises the ambition of existing biofuel targets, introduces new sub-targets specifically relevant to marine and aviation fuels, and creates a multiplier for qualifying advanced fuels used in these sectors. Together, these indicate that the EU steadfastly intends to continue to press for clean fuel adoption in hard-to-abate transport modes, putting shipping firmly in scope.
What are the targets and how have they changed?
The headline change in RED III is the increase in the EU's binding overall renewable energy target, which rises from 32% under RED II to 42.5% by 2030, with an aspirational ceiling of 45%. In the transport sector, member states must now ensure that at least 29% of all energy supplied to transport comes from renewable sources by 2030, up from 14% under RED II, or alternatively achieve a reduction in the GHG intensity of transport fuels of at least 14.5%.
Within transport, RED III raises the combined sub-target for advanced biofuels and renewable fuels of non-biological origin, known as RFNBOs, from 3.5% to 5.5%. At least 1% of that 5.5% must come specifically from RFNBOs such as green hydrogen and its derivatives, creating a binding RFNBO target for the first time. To further incentivize uptake in hard-to-abate sectors, RED III also introduces a 1.2x counting multiplier for qualifying advanced biofuels and RFNBOs used in maritime and aviation, a provision with no equivalent in RED II.
To count toward these targets, RFNBOs must deliver greenhouse gas emissions savings of at least 70% compared to the fossil fuel baseline. Notably, international marine bunkers, fuels supplied to ocean-going vessels in EU ports, are explicitly recognised as an eligible compliance pathway, meaning operators using qualifying fuels contribute directly to member states' compliance calculations, whether or not they are flagged by that nation, or operated by a domestic operator.
One provision that has not changed is the Annex IX Part B cap, which limits the share of feedstocks such as used cooking oil and animal fats that can count toward targets. This remains at 1.7%, as it was under RED II. As we explain in the second article in this series, this rule is producing real consequences for marine fuel buyers as national implementations take effect.
It is also worth noting that some member states are setting targets that go well beyond the RED III baseline. Finland, for example, has indicated ambitions for 62% of its energy share to be renewable. The practical consequence of this is that the regulatory environment for renewable or low-carbon-intensity fuels will not be uniform across Europe, and will vary, sometimes considerably, by port.
Patchy implementation
RED III does not create a single, uniform set of rules that apply identically across the EU. Rather, it establishes a base framework that each member state transposes and applies according to its own national circumstances and policy choices. Member states may exceed the minimum targets, phase in requirements on their own timelines, and adopt different approaches to specific feedstocks and compliance mechanisms.
From a practical standpoint, this matters because a shipping company’s biofuel procurement strategy for one EU port may not be optimal for other ports in the region. The directive has been in force since late 2023, but national implementation remains at different stages, with some countries already applying stricter mandates and others still working through transposition.
This fragmentation has implications for which fuels qualify for compliance in which locations, how feedstock choices affect certification, and how costs and availability vary across the ports where vessels call. The second article in this series addresses these questions directly, working through the commercial and operational consequences of an EU regulation that creates more nuance in practice than the headline targets might suggest.
How World Fuel can help
World Fuel has been closely tracking the development and implementation of RED III across EU member states, working with customers to understand the implications for fuel procurement, certification, and compliance strategy. Our teams bring together regulatory expertise and deep sectoral knowledge across key European bunkering locations, ensuring that customers have access to the right fuels, with the right documentation, in the right ports.
Whether you are planning ahead for stricter national mandates, reviewing your certified biofuel supply arrangements, or seeking to understand how RED III sits alongside your FuelEU Maritime obligations, World Fuel is well placed to support you at every step of that process.
Contact World Fuel today to discuss your regulatory compliance strategy and how we can support your fleet’s energy transition.
