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The Carbon Intensity Indicator (CII) is a regulatory measure introduced by the International Maritime Organization (IMO) under MARPOL Annex VI, mandatory for ships of 5,000 GT and above from 1 January 2023. It rates a ship's annual operational carbon efficiency on a scale from A (best) to E (worst), based on actual fuel consumption and distance sailed. The CII rating is not a static target — the reference lines against which ships are rated tighten each year, meaning a ship must improve its operational efficiency year-on-year just to maintain its current rating.
CII is one component of the IMO's short-term measures to reduce greenhouse gas emissions from international shipping. Alongside the Energy Efficiency Existing Ship Index (EEXI) — a one-time technical requirement that applies to most ships — the CII creates a continuous operational discipline around fuel efficiency and emissions management. Together, they reflect the IMO's target of reducing carbon intensity in international shipping by at least 40% by 2030 compared to 2008 levels.
The commercial significance of the CII rating extends well beyond regulatory compliance. Major charterers — including several oil majors and large commodity traders — now include minimum CII rating requirements in charter party clauses. A vessel rated D or E may be excluded from certain trades entirely, or may face commercial penalties. P&I clubs and marine insurers are increasingly factoring CII performance into their risk assessments. This means that a poor CII rating is not just a regulatory problem — it is a commercial one with direct revenue implications.
The CII formula divides a ship's annual CO2 emissions — derived from fuel consumption data recorded in the Ship Energy Efficiency Management Plan (SEEMP) log — by a capacity denominator (either deadweight tonnage or gross tonnage, depending on vessel type) multiplied by the distance sailed in nautical miles during the year. The result is a CO2 per capacity-nautical-mile figure that represents the ship's operational carbon intensity for that year.
This figure is then compared against the ship type's required annual CII — a reference line set by the IMO that decreases by a fixed percentage each year. In 2023, the reduction factor was 5% relative to a 2019 baseline. By 2026, the annual reduction factors will have compounded significantly. Ships that achieve a carbon intensity figure below the required CII fall in the A or B rating bands. Those above the required CII are rated C, D, or E — with C being acceptable, D triggering a formal improvement plan if sustained, and E requiring immediate corrective action.
It is important to understand that the CII is an operational metric, not a design metric. A ship's CII rating is determined by how it is operated — its speed, routing, load factor, fuel type, and the efficiency of its voyage planning — not just by its hull and engine design. This means that the crew, shore management, and commercial operators all have influence over the rating. Speed reduction is the single most powerful lever: halving speed reduces fuel consumption by approximately 70%, dramatically improving CII performance.
A ship rated D for three consecutive years, or E in any single year, is required to submit a corrective action plan (SEEMP Part III) to its flag state administration. This plan must identify the measures the company will take to improve the vessel's CII performance. Failure to submit an approved plan, or failure to improve performance, can result in flag state enforcement action and — in some cases — difficulty renewing certificates.
Beyond the flag state dimension, the charterer market is imposing its own consequences for poor CII performance. Time charter parties increasingly include CII-related clauses requiring the vessel to maintain a minimum rating (typically C or above) throughout the charter period. Vessels that fall below this threshold may be subject to reduced hire rates, increased fuel cost liability, or in extreme cases, early redelivery clauses. This has fundamentally changed the economics of operating older, less fuel-efficient tonnage.
The interaction between CII performance and Port State Control compliance is also developing. PSC officers may check that the required SEEMP documentation is in place and that the CII monitoring and reporting process is being followed. Deficiencies in CII documentation can result in MARPOL Annex VI deficiency codes — the same category as fuel oil non-compliance. Companies without robust systems for tracking and managing CII performance throughout the year are exposed to both regulatory and commercial risk.
The CII sits within a broader MARPOL Annex VI emissions framework. Ships are also subject to the global sulfur cap (0.50% maximum sulfur content in fuel oil since 2020, and 0.10% in Emission Control Areas), NOx emission limits for engines, and the EEXI design efficiency requirement. From 2024, the EU's Emissions Trading System (EU ETS) has added a carbon pricing layer for ships calling at EU ports — requiring shipping companies to purchase and surrender carbon allowances for a proportion of their voyages.
The FuelEU Maritime regulation, entering into force in 2025, sets progressively tighter greenhouse gas intensity requirements for the energy used by ships calling at EU ports — measured on a well-to-wake basis that includes the production emissions of the fuel, not just its combustion. This creates a strong regulatory incentive to transition to alternative fuels such as LNG, methanol, ammonia, or green hydrogen over time.
Managing CII performance effectively requires integrating fuel consumption monitoring, voyage optimisation, and operational decision-making in real time. The KPI dimension is critical: companies that track CII performance continuously throughout the year — rather than discovering their rating after year-end — have the opportunity to take corrective action, such as speed adjustments or optimised routing, before the annual rating is locked in.
Infoship's Business Intelligence module aggregates voyage data, fuel consumption records, and operational inputs to give fleet managers continuous visibility of CII performance against annual targets. Rather than discovering the fleet's CII rating at year-end, managers can see current performance by vessel and fleet level throughout the year — with the ability to model the impact of operational changes such as speed reductions or improved load factors on the projected year-end rating.
Infoship's integration with the Planned Maintenance System and voyage management functions means that the data needed for CII monitoring — fuel consumption, distance sailed, operational hours — flows automatically into the analytics layer without manual re-entry. This eliminates the data quality risks that undermine manual CII tracking. The connection to the QHSE module ensures that any MARPOL Annex VI non-conformities or documentation gaps are identified and addressed before they become Port State Control deficiencies or charterer disputes.
