North American vessel owners, ship designers and other stakeholders gathered to discuss the challenges of meeting stricter emissions standards and the pathway to decarbonisation
Sponsored by ABB, a recent roundtable event held just weeks before the 1 January implementation of the IMO 2020 0.50% sulphur cap, brought together major maritime stakeholders to discuss the environmental concerns surrounding the sector.
Representatives from Royal Caribbean Cruise Line, the Staten Island Ferry, NYC Ferry and Maid of the Mist Corp outlined the hundreds of millions of dollars of new technology investments that they have had to make in order to comply with stricter emissions standards. Combined, the four vessel operators carry more than 30M passengers annually, providing strong representation for the North American passenger vessel segment. It was clear from those gathered that the path to lower emissions and decarbonisation has been, and will continue to be, a costly and consistent effort.
“Royal Caribbean got a head start on compliance, spending a half a billion dollars on installing scrubbers about four years ago,” noted Royal Caribbean Cruises Ltd (RCCL) global fleet optimisation associate vice president Anshul Tuteja. At the time, Mr Tuteja says there was no ‘silver bullet’ in terms of compliance. He explained exhaust gas cleaning systems (EGCS) come with a whole set of challenges, including pH limit discharge, caustic soda usage and sensor values. RCCL was forced to invest another US$100M to enhance systems to ensure compliance, adds Mr Tuteja. He added one saving grace for the company was that it invested in hybrid scrubbers instead of open-loop systems, which have now been broadly banned.
Mr Tuteja said installing scrubbers was a straightforward business case for RCCL. “If you look at the spread between intermediate fuel oil (IFO) and marine gas oil (MGO), it is in the range of US$350 (per tonne). We expect a cost avoidance of roughly US$300M just by installing scrubbers.”
LNG a temporary fix
However, the regulators on hand – DNV GL business development manager Jennifer States and ABS chief engineer Derek Novak – both agreed that most shipowners have opted to burn compliant fuel instead of using scrubbers to meet the stricter standards. “As of January 2019, there were about 2,800 vessels fitted with scrubbers,” said Ms States. She noted that initial estimates had projected about 4,000 ships would be fitted with EGCSs by this point.
Also citing RCCL’s investment in three 5,000-passenger Icon class cruise ships that will be powered by LNG, Mr Tuteja explained: “I don’t think there is anyone here that thinks LNG is here to stay forever. It is still a fossil fuel and there are still challenges with methane slip and carbon.” With delivery dates between 2022 and 2025, the three Icon class ships will employ dual-fuel engines and possibly 10-MW fuel cells to produce water and electricity. With the maritime industry moving towards a 50% reduction of CO2 emissions by 2050 and eventual total decarbonisation, Mr Tuteja said using LNG was an “intermediate step” in compliance.
Staten Island Ferry chief operating officer Capt James DeSimone said the Staten Island Ferry has been burning ultra-low sulphur diesel since 2008. Capt DeSimone, who is also a director on the board of a major shipowner, noted that the owner has a fuel strategy in place: “They have been some concerns, but [the owners] are fairly confident that the compliant fuel is going to be available.”
In the US, vessel operators also have to comply with US Environmental Protection Agency (EPA) Tier 4 engine requirements. The rules pertain to marine engines in the range of about 2,000-6,000 horsepower. EPA Tier 4 regulations require a reduction of about 70% in NOx from Tier 2 standards. This leaves owners looking to aftertreatment solutions such as selective catalytic reduction (SCR) or in-engine systems, such as exhaust gas recirculation.
An SCR doses the exhaust with diesel emission fluid (DEF), a urea-based solution that causes a chemical reaction allowing the exhaust molecules to meet emission requirements. Capt DeSimone said Staten Island Ferry’s new 4,500-passenger Ollis class ferries will be fitted with SCR systems.
To comply with stricter European emission standards, RCCL is looking to fit an SCR system on one engine onboard each of its cruise ships, explained Mr Tuteja. Fitted with an SCR, the engine could be used while the cruise ship was in port, providing power for maneuvering and hotel load.
To address in-shore emissions, RCCL is also working with ABB to refit 27 of its existing vessels and all of its newbuilds with shore power connections.
ABB senior vice president HUB business line manager Rune Braastad questioned the current state of port infrastructure in the US to support shore power connections.
In response, Mr Tuteja said: “A study we undertook with the Port of Miami estimated one installation would cost in the range of US$20M to US$25M. That’s a big investment when you consider on any given day you might have 10 cruise ships lined up in the port.”
Furthermore, he says that each cruise ship would require as much as 10 MW of power. “That’s enough to suck out the entire power in the state of Florida,” he said, adding that consideration must also be given to where the ports are getting their power and how is it produced, avoiding fossil fuel-generated electricity.
“It’s a planning question and a business case evaluation,” said Ms States, adding, “For utilities, the business case doesn’t make sense if cruise ships are only calling three to four months per year.” She questioned how ports would recoup their investments, emphasising the need for more co-operation among regional port stakeholders, maritime interests and utilities.
Participants were in agreement that public perception is a driving factor in making investments in environmental technologies. “The general public is seeing global shipping as a concern when it comes to the environment and emissions,” said Webb Institute assistant professor of naval architecture Bradley Golden. “We wouldn’t be looking at IMO 2020 and emission control areas (ECAs) [if we were not being] pushed and it is not just passenger ships, but all of global shipping,” he explained.
Global shipping accounts for between 2 and 3% of global greenhouse gas (GHG) emissions. IMO has set a global target to cut annual emissions by at least 50% by 2050, as compared with 2008 baseline levels.
There is also mounting pressure on shipping from investors and the financial sector, as Ms States highlighted. She cited the Poseidon Principles, under which major shipping banks will for the first time integrate climate change considerations into their lending decisions to incentivise shipping’s move towards decarbonisation. “Investments won’t be made unless you have future-proof plans for your vessels,” she warned.
“It’s a key challenge for us,” said Mr Tuteja in discussing RCCL’s pathway to CO2 reduction and planning its newbuilds. “If we make a decision now for LNG, it means that 40 years from now the vessel will most likely still be operating on LNG.” He says that RCCL has been looking at carbon-neutral fuels, biofuels and synthetic fuels, asking, “What can future proof us?”
Both NYC Ferry and Staten Island Ferry, however, emphasised the challenges public operators face when considering new technologies. “We are always looking at options to decarbonise,” said NYC Ferry associate vice president and fleet manager Ethan Wiseman. Mr Wiseman said the varying operational profiles of his fleet make it particularly challenging. “What we are finding is that there is no one solution that fits all.”
Added Capt DeSimone: “As a public ferry operator, we don’t have the latitude to take gambles. You can’t use a public ferry as an experimental platform.”
Privately held Maid of the Mist is fully embracing electrification in its operations. The Niagara Falls tour boat operator will add its first two zero-emission, all-electric tour boats to its fleet this year. Maid of the Mist president Christopher Glynn said he was intrigued by the possibilities of the technology after reading about Ampere.
Maid of the Mist’s two 520-passenger, catamaran-hulled, all-aluminium boats will have no diesel engines on board. Each of the vessels will be powered by a pair of battery packs, split evenly between two catamaran hulls. Having two fully independent power systems on board will increase safety and redundancy, according to the company.
Shoreside charging for the vessels will only take seven minutes, allowing the batteries to power the electric propulsion motors.
The new Maid of the Mist boats will be entirely emission-free, using renewable hydroelectric power produced by Niagara Falls, a distinct advantage for the operation. Mr Glynn said choosing all-electric propulsion for the vessels made sense on a number of levels: “We are not a cruise company, so we do not use a lot of fuel. I spend more on raincoats than I do on fuel.” He added: “It has to do with the kind of company we are, being a major tourist attraction and operating at Niagara Falls, the largest source of hydroelectric power in the world.”