The North American ECA and Short Sea Shipping An Analytical Assessment

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1 The North American ECA and Short Sea Shipping An Analytical Assessment GREENTECH 2013 Green Marine Annual Conference, Vancouver BC May 30, 2013 Dr. Ranajit (Ron) Sahu, Consultant

2 The North American ECA and Short Sea Shipping An Analytical Assessment A Lesson in the Law of Unintended Consequences GREENTECH 2013 Green Marine Annual Conference, Vancouver BC May 30, 2013 Dr. Ranajit (Ron) Sahu, Consultant sahuron@earthlink.net

3 Topics - The North American ECA (briefly) - Fuel sulfur requirements - The 200 mile requirement - Air Pollutants (SO2, NOx, PM // CO2, other GHGs) - Short-sea Shipping - ECA Equivalence - Establishing a credible distance requirement via modeling - Unintended (but forseeable) Consequences - Modal shift - Climate // Energy Adverse Impacts

4 ECA - Requirements

5 THE CSL GROUP INC

6 THE CSL GROUP INC

7 THE CSL GROUP INC

8 Air Pollutants A. Regional/Local - SO2 (also fine-pm precursor) - NOx (also ozone and fine-pm pre-cursor) - PM (various sizes) Controlled based on health-protective standards (e.g., US National Ambient Air Quality Standards, etc.) - for SO2, the most stringent NAAQS is the 1-hour standard Source-Receptor Distance Matters! B. Global - GHGs, including CO2 Source-Receptor Distance Does Not Matter

9 Short Sea Shipping Short Sea Shipping (SSS) is any movement of cargo by any vessel type occurring in direct competition with rail or truck. This occurs in the Inland Waters and Coasts of both Canada and the U.S.A. The Marine Highway (SSS) is vital to the US and Canadian trading relationship. A 7 day trip entirely within the ECA is the norm A recent economic study shows Short Sea Shipping (Seaway) to provide for: $34.6 billion in economic activity 227,000 US and Canadian Jobs $4.7 billion in taxes paid (Canada and US Federal/States)

10 Short Sea Shipping is Sustainable Shipping Short Sea Shipping is inherently more environmentally sound than other transportation options; aligns with MARAD s Marine Highway Program; & reduces land based congestion & emissions.

11 Short Sea Shipping is Sustainable Shipping Miles per gallon of fuel Panamax Coastal

12 Even Greater Efficiency Short-sea shipping provides the most fuel efficient freight transport mode on a ton-km basis (Laker/Handy Bulker)

13 Short Sea Shipping Routes within ECA

14 Deficiencies in ECA Analysis Did not consider short-sea shipping or potential modal transfers. Impacts analysis is dominated by large vessels, oil tankers, etc. for which modal shift is not a possibility or an issue. Analysis uses 2002 as a base year and projects economic variables and emissions through 2020 this does not recognize major economic disruptions in recent years. As a result, the negligible impacts due to short-sea shipping are not apparent. Bottom line: 200 nm ECA is not technically justified or economically sustainable to Short Sea Shipping.

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16 Updated Science: Focuses on short-sea shipping. Uses EPA approved modeling tools. Focuses on sulfur dioxide (SO2), the main pollutant emitted that is directly a consequence of sulfur levels in the fuel and hence the pollutant directly related to fuel choices. Focuses on East Coast and West Coast shipping routes. Used historical meteorological data on East & West coasts.

17 Scope of Study

18 Scope of Study

19 East Coast Study Zones

20 Shore Concentrations vs. Vessel Distance from Shore (km) 1, , , , , , ,20000 Narragansett Sandy Hook Cape May Cape Henry Cape Lookout Cape Romain Savannah Jacksonville Cape Canaveral 0, ,20000

21 Shore Concentration Profile - Cape Henry ,00E-01 7,00E-01 6,00E-01 5,00E-01 4,00E-01 3,00E-01 Normalized Concentration 2,00E-01 1,00E-01 0,00E+00 Distance Along Shore (km) Cape Henry = Vessel Distance from Shore (km)

22 Model Prediction and SO2 NAAQS Ship Selection Criterion hp hp Vessel Location (affects Load) Port-40 km km SO2 Level in Fuel ECA Modified ECA Engine Size (kw) Engine Load SO2 Rate (gram/kw-hr/%s) SO2 Level in Fuel (%) SO2 Emission Rate (kg/hr) Highest 1-hr Shore Conc. (ug/m3//kg/hr) (Location) Cape Canaveral Cape May Highest 1-hr Expected Shore SO2 Conc. (ug/m3) EPA 1-hr SO2 NAAQS (ug/m3) Highest SO2 / NAAQS 1.01% 0.55%

23 Commitment to ECA Support the North American ECA. Support 1% sulfur fuel within a 200 mile ECA. Support 0.1% sulfur fuel within a 50 mile (80 km) ECA.

24 Caribbean ECA

25 Modal Shift As it becomes more expensive to transport low-value cargos via Short-Sea routes, some of the cargo will transfer to lessefficient land-based routes such as rail or truck. - for example, in the US East Coast along I-95 corridor and in the US West Coast along the I-5 corridor - exposing large populations to higher levels of emissions (including additional toxic air pollutants) at much shorter distances - adding to transport congestion - Increasing safety risks

26 The I-95 Corridor Coalition is a partnership of state departments of transportation, regional and local transportation agencies, toll authorities, and related organizations, including public safety, port, transit, and rail organizations, from Maine to Florida, with affiliate members in Canada.

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31 Climate Concerns

32 Conclusion & Recommendations Policy makers must recognize Short Sea Shipping as the most environmentally advantageous means of moving cargo. Canada and the U.S.A have a distinct Short Sea (Marine Highway) trading relationship. Policy makers should understand the economic advantage of Short Sea Shipping to both Countries and the Jobs that are provided within this transportation sector. International rules need to be adapted to work when applied to Short Sea Shipping. Reducing ECA size for Short Sea Shippers allow the continued use of this mode of cargo transport while maintaining all of the environmental benefits. We recommended a sustainable standard of 50 miles, similar to Emission Control Areas worldwide such as the Puerto Rico/Caribbean ECA. We recommend a 1% ECA standard out to 200 miles and a 0.1% standard out to 50 miles for SSS vessels less than 20,000 H.P.