EMP is the acronym for electromagnetic pulse. It creates an electromagnetic field around itself, which disrupts electronic devices, causing them to shut down within range. All of Zion's hovercraft carry devices capable of producing EMPs. The blast from an EMP is sufficient enough to disable any electrically-powered machine within its blast radius.
An EMP was used against the Machines by the hovercraft crews during the Machine War. When Smith entered the Real World disguised as Bane, he uses an EMP to take out most of the hovercraft, leaving only the Nebuchadnezzar, the Mjolnir, the Logos, and the Vigilant operative. During the Battle of Zion, the Mjolnir, under heavy attack from Sentinels manages to burst into the Dock and activate its EMP, crippling the Machines army of Sentinels and its digger machines. The victory is short-lived, however, as Zion's defenses are also rendered inoperative and a new swarm of Sentinels arrives for the final assault.