CO2 emissions from ships – The latest IMO regulatory developments and what they mean for bulk carriers

Source Hellenic Shipping News vom 28.12.2011

A new International Energy Efficiency Certificate (IEC) will be introduced for all vessels, and this includes a supplement recording particulars related to the ship’s energy efficiency, such as the propulsion system, the Attained EEDI for new builds, and the presence of a SEEMP. The EEDI requirements will apply to new ships above 400 GT only, where “new ship” means a ship: for which the building contract is placed on or after 1 January 2013; or in the absence of a building contract, the keel of which is laid or which is at a similar stage of construction on or after 1 July 2013; or the delivery of which is on or after 1 July 2015. The yard, designer or a consultant will have to develop an EEDI technical file containing the necessary documentation and calculations. Verification will be done in two stages: a preliminary verification at the design stage based on tank tests, manufacturers’ data and design particulars. During the speed trial the speed will be measured and the technical file will be updated, together with engine certificates and other necessary documentation. The EEDI technical file will then be verified by a flag administration or Recognized Organisation and the IEC will be issued. The regulation differentiates between ship types which are required to calculate an Attained EEDI and those that must have an Attained EEDI below a certain Required EEDI. In order to address concerns raised by developing countries, the regulations include a clause allowing any Administration to waive the EEDI requirements for ships flying its flag for a period of up to four years (linked to the contract date), or six years and six months (linked to the delivery date) after 1 January 2013. However, the preliminary indications are that the major flag states will be reluctant to invoke the waiver clause. No changes were made to the SEEMP at MEPC 62, but its inclusion in the Annex VI amendments makes it mandatory for all ships– both new and existing - after it enters into force. The presence of a SEEMP will be checked during the first intermediate or renewal survey for the IAP certificate, at which point the IEC will be issued. The EEDI will not be calculated for existing vessels and thus not included in the IEC. The adoption of the amendments is a significant step towards the regulation of GHG emissions by IMO. Nevertheless, the EU is likely to consider it insufficient in light of its own ambitions. The EU process for establishing a regional CO2 emission reduction mechanism for shipping is therefore expected to continue. Other parts of the international community also consider these regulations insufficient. There is therefore a strong political drive to regulate shipping further, e.g. through regional or international. Proposals under review range from a contribution or levy on CO2 emissions from shipping, via emission trading systems to schemes based on ship efficiency. If agreed, MBMs may appear towards the end of this decade. Commercial energy efficiency requirements are becoming increasingly important. The creation of various voluntary schemes for rating environmental performance, including CO2 performance, is providing tools that allow charterers and cargo owners to use only ships that satisfy their environmental requirements. These rating schemes must be based on robust methods and verifiable data in order to create a level playing field for the ship owner. Typical bulk carriers can fall into one of three categories in the MARPOL Annex VI amendments: bulk carriers, combination carriers and general cargo ships. A ship covered by the definition of a bulk carrier in SOLAS chapter XII, which includes ships “…primarily designed to carry dry cargo in bulk..”, will be measured against the bulk carrier reference line. Some dedicated ship types carrying woodchips, cement, fly ash or sugar are excluded from this definition and should, together with open hatch carriers, be considered general cargo ships when applying the requirements. As can be seen from the chart above, the reference line for general cargo ships is higher than that for bulk carriers so that the requirement will be lower for these ships. A ship which can load 100% deadweight with both liquid and dry cargo is considered to be a combination carrier and can use the reference line used by tankers. Any measure considered for reducing the EEDI must affect one or more of the parameters in the EEDI equation. In addition, there will be compensation when using shaft generators (PPTO) and applying ice strengthening (fj). Other correction factors, for example for voluntary structural enhancement, are under development. Some proposed measures, such as kites or solar panels, cannot provide power all the time and will not enable the main engine power and thus the EEDI to be reduced. At the moment, there are no guidelines for how such measures can be applied to reduce the EEDI, but these are expected to be developed at a later stage, most likely through the Peff parameter. Propulsion efficiency devices, such as Mewis ducts or propeller boss cap fins, are not expected to reduce the main engine power, but will enable the ship to obtain a higher speed (Vref). Further, the use of biofuels is not covered by the current framework as the carbon content cannot easily be determined. There are no indications regarding if and when this will be developed. A number of guidelines are going to be developed during the next few years, with the most important being issued before the entry into force in 2013: February 2012 – MEPC 63: Guidelines for minimum propulsion power October 2012 – MEPC 64: Guidelines on voluntary structural enhancement July 2013 – MEPC 65: Guidelines for CO2 abatement technologies March 2014 – MEPC 66: Guidelines for calculation of EEDI for roro, passenger, diesel-electric and hybrid propulsion ships The requirements and dates are subject to two reviews: the first is on the requirements for small ships and large bulkers and tankers and is due in July 2013. The second review allows for a discussion of both the requirements and the timeline for when Phases 2 and 3 are to enter into force, and is due in January 2015.

The Unintended Consequences of the Sulphur Cap

Source BIMCO vom 02.11.2011

New regulations really need to be thought over carefully and exposed to the most rigorous cost-benefit analysis. It is often said that legislation concocted in haste will be inevitably regretted by its recipients and that those making regulations need always to consider “the Law of Unintended Consequences”, which will often catch out those who have allowed their enthusiasm for legislation to get the better of them. Perhaps it has been taking rather too long to build up a head of steam, but the opposition to the proposed EU 0.1% sulphur cap due to take effect in 2015 within the European Emission Control Areas seems to be growing very fast. Ferry and short sea operators in particular have been doing their research and are, as a result, better equipped to forecast the consequences of this drastic reduction of sulphur content in fuel oil, due to become mandatory. Speaking to the UK House of Commons Transport Committee recently, the UK interest group Maritime UK told MPs that the proposals are likely to increase bunker costs by nearly 90% and will almost certainly add some GBP 3.6 billion per annum to the operating costs of shipping around north Europe. There have been submissions from owners’ representatives and from ferry operators such as Stena, DFDS and Grimaldi, all of which anticipate that the consequences will be to see hard-won freight diverted from the ships back to the cheaper roads. The real irony of this is not just that the consequences of this regulatory change will end up harming the environment far more than the growth of marine traffic would do, were this sulphur cap not put in place on a regional basis. It is also significant that the ferry companies seeking another look at this unwanted change are all operators which are investing heavily in the cleanest, most environmentally sustainable, new tonnage that it is possible to buy. These are all companies which are in the van of the green shipping movement, all with plans for ever greener tonnage. Grimaldi, for instance, plans to spend no less than EUR 3 billion over the next three years in new ferries and Ro/Ro tonnage to upgrade its routes. P&O Ferries are taking delivery of two of the biggest ferries in the world for their English Channel operations, which have been designed with extraordinary thought for every practicable environmental improvement. Stena and DFDS both operate fleet being continuously modernised, with immense effort going into the reduction of harmful atmospheric emissions and the conservation of fuel. Many of these companies operate “cold ironing” systems to ensure that the ships are on shore power when in port. In short, these ships are run by people doing the very best for the environment, and the consequences of the proposed 0.5% sulphur cap is likely to do them severe economic harm. So far there has been little indication that the economic and even environmental consequences of the sulphur cap have been fully comprehended by the regulators, despite the efforts of shipping interests. There seems to have been a notion that the use of LNG will become widespread, or that the price and availability of low-sulphur will make this an attractive option, or that scrubbers will become cheaper to install to existing ferries. It is the “unintended consequences” of this hoped-for environmental improvement and the lack of any lasting benefit for horrendous potential costs, which are causing concern. Articles written by the Watchkeeper and other outside contributors do not necessarily reflect the views or policy of BIMCO.

ClassNK Issues First Ever Statement of Fact for Tier III NOx Emissions for an SCR-equipped Diesel Engine

Source Hellenic Shipping News 30.12.2011

ClassNK announced today that it had awarded its first ever Statement of Fact for Tier III nitrogen oxide (NOx) reductions to a marine diesel engine incorporating a Selective Catalytic Reduction (SCR) system. The document, issued on 1 November 2011, verifies that the NOx emission measurement results　for the engine, fitted with a pre-turbocharger SCR system developed by Hitachi Zosen Corporation, meets the NOx Tier III emission limits stipulated in amendments to Annex VI of the International Convention for the Prevention of Pollution from Ships 1973 (MARPOL). The engine in question was fitted as the propulsion system for MV “SANTA VISTA”, a 37,800 dwt general cargo ship, built by Naikai Zosen Corporation for Nissho Shipping Co., Ltd., which entered service on 31 October 2011.Not only is this the first time that ClassNK has issued such a document for a marine diesel engine fitted with an SCR system, it is also the first statement of fact issued by the Society for Tier III NOx reduction compliance of any kind. SCR systems, currently a hot topic as industry looks for solutions to strengthening NOx regulation, offer the potential for independent reductions in emissions of more than the 80% required under Annex VI. Anticipating a growing interest in this technology and its applications in the near future, ClassNK released new guidelines, Guideline for SCR (Selective Catalytic Reduction) Systems and Reductant Agent Supply Systems, to assist manufacturers, shipyards, and owners in installing such systems on their commercial vessels.