Energy considerations dominate Posidonia debate

At this year’s bi-ennial Posidonia gathering in Greece, Det Norske Veritas chief executive officer Tor Svensson outlined some of the key findings of the class society’s Shipping 2020 study. One was that in 2020, newbuildings will emit up to 30 per cent less CO₂ than those being delivered now. The main driver of emission reductions will be the Energy Efficiency Design Index.

About 1,000 newbuildings will be delivered with LNG engines, assuming the LNG price remains about 30 per cent lower than heavy fuel oil. Mr Svensson said the “most likely scenario” by 2018-2020 would be about 30 per cent of newbuilds having LNG engines.

On present indications, distillate fuel is the choice most likely to meet ECA requirements, because scrubbers will not be a viable option before 2020.

Mr Svensson said that there are important questions regarding what technologies should be installed to address new environmental regulations, higher fuel prices and other uncertainties.

Most shipping companies require a minimum payback period of five years to justify an investment in technology. A lower LNG price favours the use of LNG rather than the installation of scrubbers. Only a limited proportion of the fleet can justify investing in scrubbers.”

He said that the real game changer regarding technology choices will be the 0.5 per cent global sulphur limit in 2020, and that the industry is “still at an early point of the technology learning curve.”

Mr Svensson warned that there is a need for more study regarding the supply of distillate fuels, but the findings of IMO’s study due in 2018 might come too late for owners needing to make decisions.

He said he expected that most ships affected by the North America ECA that came into force in August would switch to distillates to comply. “This is the most straightforward option because of the uncertainty of other systems, especially scrubber technology, while the current economic situation inhibits investment. But a lot of owners are asking questions about how to make ships ready to convert later.”

A conference organised by the North American Marine Environmental Protection Association heard speakers talk about compliance with a tough US environmental regulatory regime.

An operator’s perspective was shared by Vayla Hatziyiannis, a senior project engineer in technical services at OSG in Athens. She said that compliance with the new North America ECA regime necessitates changes to infrastructure as well as operations to use low sulphur fuels, and that operators must also be aware of state regulations, such as those of the California Air Resources Board. Ms Hatziyiannis also said that environmental compliance has become a more complex job that requires “awareness of regulations, operational analysis and technical know-how for fleet implementation through project management.” She used the example of the US Final Rule on ballast water management, which was published earlier this year. OSG is currently using two newbuild Aframaxes as testing grounds for ballast water treatment systems and is learning lessons with regard to retrofitting existing vessels. Ms Hatziyiannis added that there are many aspects to consider: “It is complex and will require a big investment in both money and time.”

Jeanne Grasso of law firm Blank Rome said that continued violations in so-called magic pipe oily water discharge cases are not driven by economic considerations, but by a combination of operational and training issues. “Equipment is not working or problematic, and it is easier to bypass it,” she commented.

Companies need to show leadership on the issue and ensure that systems and training are in place, as well as improve communication between company leaders and ships’ crews so that corporate policies are communicated, understood and implemented. She indicated that regulators are likely to start targeting shore-based management rather than just shipboard personnel.

Fred Gordon, senior vice-president for corporate affairs at Navios Maritime Holdings, said that environmental awareness has become an integral part of corporate culture and must be based on executive leadership, supported by industry professionals and investment in technology. “Sustainability in shipping has become a big issue regarding environmental aspects and commercially. Reducing fuel consumption, emissions and pollution are high priorities, but so are improvements to working conditions,” he said.

Navios is participating in the EU Refresh energy efficiency programme with two bulk carriers. With regard to the Navios Group tanker fleet, the company’s approach involves green retrofitting, with a workshop to develop practical current energy saving solutions using the latest technology installed in newbuildings with energy saving design features. “This aspect is also increasingly important with regard to meeting oil majors’ vetting requirements,” Mr Gordon commented.

Navios’ integrated management for tankers complies with the Tanker Management Self Assessment and the OHSAS 18001 health and safety management standard. The company is using benchmarking to improve environmental performance. Navios is preparing for implementation of the ISO50001 Energy Management standard, developing an in-house project team to investigate application of ballast water treatment across its whole fleet, retrofitting its fleet with the latest and most environmentally friendly refrigerants, and considering the installation of exhaust gas scrubbers. TST