Efficiency through technology choices
The global shipping community is entering a challenging future, as both demands for economic results and the upcoming environmental requirements will change shipping and lead to significantly cleaner and more efficient operations.
Those operating in dedicated Emission Control Areas (ECA) from 2015 have mainly three choices: switch to low sulphur (0.1%) fuel oil, install a scrubber or convert to LNG. Each of these options comes with its own set of risks, thus making investment decisions difficult. The solution that appears to be the cheapest investment may turn out to be the most expensive one in the long run. In order to remain competitive in the market, it is crucial to make the right choice.
The ECA requirements will affect trade in large parts of Europe as well as the United States and Canada, and some 40 per cent of the world fleet enter these areas during a year, with half spending more than five per cent of their time in these waters. ECA requirements are also being considered in several other areas globally and this means that ECA requirements must be part of your planning. From 2016, all new ships must comply with the Tier III NOx requirements when operating in the North American/US Caribbean ECA and this requirement is almost certain to be extended to the Baltic Sea and North Sea ECAs as well.
Scrubbers allow for the use of high sulphur fuel and there are no availability concerns as to fuel. A scrubber requires significant space and investment costs and will not comply with future NOx requirements.
LNG has been used as a marine fuel since 2001 and 38 LNG-fuelled ships are in operation worldwide, with about 30 in the order books. LNG meets the future ECA SOx limits, helps meeting EEDI requirements and can comply with ECA NOx regulations, but requires significant investment and extra space on board for LNG tanks. The main concerns include LNG bunkering availability and the price of LNG.
Low sulphur fuel oils are a well proven and tested solution, but both price and supply capacity sufficient to meet a sudden increase in demand may be issues if this becomes the preferred solution. In addition, they will not help meet the NOx regulations.
MARPOL SOx Regulations (photo credit: DNV)
Source: Océane Balland and Harald Gundersen, DNV
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