SHIPPING AND THE ENVIRONMENT THE LATEST STATE OF PLAY IN IMO AND EU ROYAL BELGIAN SHIPOWNERS ASSOCIATION

Transcription

1 SHIPPING AND THE ENVIRONMENT THE LATEST STATE OF PLAY IN IMO AND EU ROYAL BELGIAN SHIPOWNERS ASSOCIATION European Tugowners Association Annual Meeting Burgas 22/05/14

2 Royal Belgian Shipowners Association (RBSA) MISSION : Protect common interests of all shipowners and ships managers established in Belgium. Operational support and clarification concerning: fiscal social environmental and maritime legislation. Promotion of the sector as attractive employer Close cooperation with all relevant national and international parties. VISION : As Belgium s maritime knowledge centre, the RBSA hopes to play a pioneering role in the continuing expansion and long-term growth of the sector of international maritime transport by sea. In its role of forward-looking opinion maker, the RBSA hopes to serve as the ideal discussion partner for all parties concerned.

3 RBSA 24 MEMBERS EXMAR (DEEP + SHORT SEA) TRANSPORT LPG en LNG 3 WILL BUILD THE FIRST SEA-GOING LNG BUNKERING SHIP FOR PORT OF ANTWERP URS TUGBOATS DELPHIS (DEEP + SHORT SEA) CONTAINERSCHIPS ONE OF THE STRONGEST PLAYERS IN SHORT SEA SHIPPING EURONAV (DEEP SEA) TRANSPORT CRUDE OIL RECENTLY BOUGHT 13 VLCCs FROM MAERSK BOCIMAR (DEEP SEA) TRANSPORT DRY BULK FASTLINES (SHORT SEA) SSS TRADES IN BALTIC SEA

4 The majority of the members of RBSA are trading worldwide SHORT SEA SHIPPING

5 RBSA IN THE FRONT SEAT EUROPEAN COMMUNITY OF SHIPOWNERS ASSOCIATION ECSA (BRUSSELS) INTERNATIONAL CHAMBER OF SHIPPING ICS (LONDON) FEDERAL ADMINISTRATION RBSA BOARD OF DIRECTORS (Chiared by Peter Vierstraete) COMMITTEES (technical, social, legal issues) MEMBERS

6 INTERNATIONAL MARITIME ORGANIZATION

7 IMO STRUCTURE

8 IMO COMMITTEES MSC MEPC The Maritime Safety Committee is the highest technical body of the IMO. It has a broad mandate to consider any matter related to maritime safety. It adopts amendments to convetions such as SOLAS. The Maritime Environmental Protection Committee (MEPC) is empowered to consider any matter within the scope of the Organization concerned with prevention and control of pollution from ships. In particular it is concerned with the adoption and amendment of conventions and other regulations and measures to ensure their enforcement. RBSA technical advisor to the Belgian Maritime Administration at every MEPC TCC The Technical Cooperation Committee co-ordinates technical assistance in the maritime field, particularly to developing countries FAL Facilitates international maritime traffic by focusing on reduction of formalities and simplifying documents pertaining to entering and leaving ports and terminals LEG Established to consider any legal matter within the scope of the organization.

9 SHIPPING AND THE ENVIRONMENT Regulations applying to Sulphur Oxides (SOx) Nitrogen Oxides (NOx) Greenhouse gases Waste handling (liquid, dry) Oil pollution. Future regulation SOx and NOx Ballast Water Treatment Ship Recyling Noise reduction Black Carbon Hull fouling

10 SOx NOx

11 EMISSION CONTROL AREAS (ECAs) The North Sea, Baltic Sea and English Channel (+ 200 nm zone of the US) were designated Emissions Control Areas or ECAs for SOx in accordance to MARPOL Annex VI HEAVY FUEL OIL MARINE GAS OIL Geographic shipping emissions distribution in ECA 2011 for PM2.5 which consists of organic and elemental carbon, ash and wet sulfate particles. (SOURCE: FINNISH METEOROLOGICAL INSTITUTE(FMI)

12 FROM HFO TO DISTILATES (to LNG ) 40% of domestic trade in Europe by ship! 01/01/2015 FUEL PRICE FOR SHIPS IN ECAs WILL RISE 30-50% In summary, the use of MGO (0.1%) is expected to have a negative effect on freight rates and the modal split on a large set of origin-destination relations. On some trade routes the short sea option might lose its appeal to customers. This will lead to traffic losses for the short sea option in favor of trucking. Obviously, the use of MGO will have a positive impact on external costs generated by short sea vessels alone. Depending on the actual modal back shift the overall outcome for the environmental performance might well be Negative. Source ECSA study 2010

13 : SULPHUR DILEMMA 13 IMPROVE THE ENERGY EFFICIENCY CHANGE TO MGO Run full time on Marine Gas Oil (MGO). Convenient High operating Cost LNG ( other low flashpoint fuels, e.g. Methanol) EXISTING SHIPS A solution which also reduces NO x and particulates NEW BUILDS (in general) (methanol option for existing ships) Investment cost LNG availability USE SCRUBBERS Install an exhaust gas cleaning system (scrubber). Works with high sulphur fuel oil EXISTING SHIPS ROI depends on price difference between HFO and MGO CAPEX RELIABILITY! IMPACT ON CO2 EMISSIONS (MGO: life cycle! - LNG: methane slip! - SCRUBBER: 1-3% additional fuel consumption!

14 LNG

15 LNG (Liquified Natural Gas) Natural gas cooled down to -162 C. Volume 600 times smaller. RBSA paving the way to LNG fuelled ships. RBSA chairs the LNG WG of ECSA and is rapporteur of the LNG WG of the European Sustainable Shipping Forum (ESSF, the working groep of the European Comission on LNG for shipping) + Ecological benefits (compared to MGO). no SOx very low NOx and Particulate Matter and 10-20% lower CO2 Anticipates future environmental legislation. Low operating cost Very expensive to install on ship. Not very interesting for existing ships because of the footprint. Very few distribution points on main land only one dedicated bunkering barge (so far) Methane release (in ports during bunkering and combustion) Crew training Safety! Legislation (IGF-code, bunkering guidelines,...) Price of LNG at delivery to the ship too high

16 LNG MARKET 21/10/13 : 11.4$/mmBtu what will Russia settle for? 21/10/13 : 3.6$/mmBtu Gas-on-gas competition setting the price in Europe?

17 BUSINESS CASE POSSIBLE? DETERMENING FACTORS:... type size speed % activity in ECAs trade IN CASE OF: short distances (= small tanks, low price) fixed trades (= certainty) allows for billateral agreements between states (regulation not finalized!) good price for LNG (= FLEXIBILITY OF SUPPLIERS!) BUSINESS CASE IS POSSIBLE e.g: Ro-Ro, Ro-pax ships (existing or new build) CLARITY ON REGULATION FOR MOBILE TANKS NECESSARY! (connection and disconnection process not finalized in draft IGF-code ) 47 LNG fuelled ships in operation worldwide (07/03/2014)

18 soon more than 100 LNG fuelled ships...

19 SCRUBBERS...washing the sulphur from the exhaust BRON WÄRTSILÄ

20 SCRUBBER Promising for existing ships? CONSTRAINTS INSTALLATION Weight and stability issues Corrosion COST! (bank loans?) Footprint Aditional power (CO 2 regulation?) Back pressure Reliability Waste handling (PRF) EXTERNAL FACTORS Age of the ship % trade in ECAs Size and type of the vessel Future price of HFO Legislation washwater criteriria OPEN LOOP OR HYBRID SYSTEMS?

21

22 RELATIVE - ABSOLUTE shipping is the most energy-efficient transport mode IMO GHG Study of 2009: GHG emissions from international shipping in 2007 is estimated about 870 Million tones (consumption of 270 Million tones fuel). About 2.7% of global emissions of CO Mio tonnes of fuel = 870 Mio tonnes of CO2! (2.7% = CO2 emissions from Germany in 2007)

23 CO 2 WHAT IMO HAS DONE SO FAR Responsilibity given to IMO from UNFCCC to find a solution Since 2005: Energy Efficiency Operational Indicator = EEOI calculated from actual operational parameters (fuel, cargo, distance) from existing ships Energy Efficiency Design Index = EEDI calculated from technical desings charachteristics (ONLY for new builds!) Market Based Instruments MBIs (work in progress...???) United Nations Framework Convention on Climate Change EEOI + MBMs EEDI + FOCUS ON EXISTING SHIPS IMO EEDI and SEEMP not engough...! Monitoring Reporting Verification

24 2. ENERGY EFFICIENCY DESIGN INDEX (EEDI): NEW BUILDS! (g.co2/ton.nm) EEDI: MEASURE FOR THE ENERGY-EFFICIENCY OF NEW BUILD SHIPS CALCULTED FROM TECHNICAL PARAMETERS The Energy Efficiency Design Index (EEDI) is mandatory for new ships (since 2013). New chapter added to MARPOL Annex VI!

25 EEDI REFERENCE LINES (BENCHMARK) IMO currently determining minimum propulsion power to maintain the manoeuvrability in adverse weather conditions Reduction factors will be applied in different phases starting from 01/01/2013.

26 26 ENERGY EFFICIENCY IMPROVEMENT EXISTING SHIPS BARRIERS (Inertia?) S SAVE AS P YOU SAIL L I T INCENTIVE source: Deltamarin

27 27 ENERGY EFFICIENCY OPERATIONAL INDICATOR (EEOI): EXISTING SHIPS! FIRST ATTEMT BY IMO (5 YEARS AGO!) =Measure for the energy efficiency of an EXISTING SHIP, calculated from real operational data : Fuel consumption (multiplied by a carbon factor of 3.11 for HFO) Load Distance FOR ALL VOYAGES DURING A YEAR Available in noon report (level of accuracy : margin of error relatively high) FUEL CONSUMPTION IN BALLAST VOYAGES (+ PORT) INCLUDED, DISTANCE IN BALLAST NOT!

28 28 THE NUMBERS TELL THE TALE... EEOI STUDY (publication 2009)

29 ENERGY EFFICIENCY OPERATIONAL INDICATOR RESULTS EEOI of 43 Belgian flagged ships (5 ship types) It is very difficult to determine what causes the variation in the EEOI (too much information in one index). Operational variations mainly caused by: cargo transported efficiency of the ships (engine condition, hull and propeller fouling, etc...) variations in speed! weather and currents errors in measurement and registration. EEOI very much depends on the market! Not a good indication of the energy efficiency of the ship while at sea. (conclusion in 2009)

30 30 WHO CARES ABOUT THE EEOI? EUROPEAN COMMISSION MONITORING, REPORTING, VERIFICATION (MRV) PUBLICATION OF INFORMATION EEOI Who is responsible? OWNER CHARTERER SPLIT INCENTIVE

31 31 ANALYSIS OF THE ENERGY PERFORMANCE OF THE BELGIAN MERCHANT FLEET FOLLOW UP STUDY RBSA 2014! 5 years later... The high fuel price and rising environmental awareness combined with the ever recurring overcapacity within the shipping industry has indisputably had a huge impact on the energy management policy of shipping companies. We want to find out to what extent! TIME FOR A FOLLOW-UP STUDY Make a comparison between the EEOI (calculated based on the fuel consumption of all voyages during a calendar year) for the year 2007 to 2012 and to try to identify tendencies, taking e.g. into account the economic recession, fuel prices,... Demonstrate if and how the exact amount of GHG emissions have been reduced through measures such as slow steaming, propeller adjustments, and new generation of hull coatings,... What is the impact of design? 2 PHASES PHASE I: data collection and input (with Antwerp Maritime Academy) 6 months starting from July 2013 PHASE II: analysis at least 6 months starting from Q (from there submissions to the IMO)

32 32 RBSA ENERGY EFFICIENCY DATABASE: 119 SHIPS most detailed database worldwide TYPE NUMBER TOTAL AVERAGE AGE SIZE NUMBER BULKERS 45 LPG TANKER CONTAINER OIL TANKER CHEMICAL TANKER Handysize (10,000-35,000 DWT) 17 Handymax (35,000-59,000 DWT) 4 combined DWT 5,1 Panamax (60,000-80,000 DWT) 1 4,914,612 Capesize (80,000 and over DWT) 23 pressurized ( GT) semi-refrigerated (12030 GT) 1 11 combined GT midsize (25,000-40,000 GT) ,356 very large (app. 85,000 GT) 2 10 combined TEU 21,626 6,1 Suezmax (120, ,000 DWT) VLCC (200, ,000 DWT) 22 8,9 combined DWT ULCC (320, ,000 DWT) 1 7,576,198 12,4 combined DWT 61,859 TOTAL 119 8,7 5 feeders (< 3000 TEU) 10 / /

33 THANK YOU! Ludovic Laffineur Environmental Policy Advisor Royal Belgian Shiponwers Association