Ensuring availability of fuels compliant with MARPOL Annex VI by 2020
The International Chamber of Shipping (ICS) has submitted a document to IMO to highlight the increasing importance of reliability assessing the availability of MARPOL Annex VI compliant fuels in a timely manner and to suggest that the successful implementation of the requirements of regulation 14 will be dependent on an early review.
During MEPC 64 the Committee considered the ICS paper MEPC 64/4/17 calling fora preliminary study on the availability of compliant fuel, taking into account the introduction ofthe Sulphur Emission Control Areas (SECAs) to be implemented in 2015 as a test case.
Anumber of States recognised that such a preliminary study would be advantageous whilstothers considered that such a study would be of little value in assessing the 2020 availabilitydue mainly to the differing fuels required by the 2015 ECA and the proposed 2020requirements.
The Committee agreed that this matter should be reconsidered at a futuresession and invited interested delegations to submit proposals to MEPC 66 (MEPC 64/23,paragraph 4.36).
Many States that spoke during the MEPC 64 discussion recognised that it would beimportant to ascertain fuel availability sooner rather than later, and to identify what actionmight be necessary to ensure the availability of compliant fuel in 2020
There have been a number of articles in the press recently expressing opinion onthe availability of marine fuels to meet the MARPOL Annex VI 2020 requirements. Somehave been highly optimistic and suggested there will be no supply problems, whilst othershave described a very different and more pessimistic scenario.
The lack of clarity in this matter is of increasing concern to the shipping industry, especially when the availability ofalternative means of compliance in advance of 2020 is also questionable.
ICS is of theopinion that continuing questions surrounding exhaust gas scrubbing technology efficiencyand the environmental acceptability of discharge, together with the lack of infrastructure tosupport gas fuelled technologies, means that these options will most probably have verylimited impact on the increased demand for traditional hydrocarbon low sulphur fuels by2020.
The possibility of conversion of very large volumes of residual fuels to marinedistillates to meet both the 0.5% global demand and the 0.1% SECA demands willundoubtedly be a significant undertaking for refiners. Without the timely and reliableindication that could be provided by an early study it is possible that investment in refineryconstruction and conversion will not be pursued.
ICS believes that it is essential to carry out a study sufficiently in advance of the2020 global 0.5% sulphur implementation date to give refiners adequate time to invest andreact. It is important to recognise that major refinery upgrading projects which will be requiredby the regulation, are understood to take a minimum four or five years to implement.
Therefore, ICS considers 2018 too late for both the assessment of 2020 Annex VI compliantfuel demand and its predicted availability. It should be noted that the MARPOL regulationrequires the study to be completed “by 2018”, but does not stipulate any date to commencethe fuel availability study nor does it prevent early completion.
ICS believes that time is rapidly running out for a study to have any possibility toinfluence refining capacity to ensure availability at reasonable cost for all fuel markets.
An additional concern is that demand for fuel with maximum 0.5% and 0.1% sulphurwill lead to increased blending; 0.1% and 0.5% sulphur fuels are not a standard refineryoutput. There is a need to consider what fuels will be blended and the consequent effects oncombustion.
There are an increasing number of incidents being experienced ofcontamination issues with cat fines and chemicals in blended fuel supplied to meet thepresent stipulated sulphur limits and also with the delivery of fuel with a flashpoint below theSOLAS specification. Such issues are likely to escalate with the increased demand for lowsulphur fuel.
ICS therefore urges that the fuel availability model proposed by the CorrespondenceGroup is used to carry out a study on MARPOL compliant fuel availability as soon aspossible. ICS believes that the critical review of fuel availability that is to be carried out underregulation 14.8 of MARPOL Annex VI is now urgent.
The Committee is invited to consider the need for urgently commencing the studyon fuel availability and to decide as appropriate.
