The Suppliers Forum in this year’s edition of Ballast Water Treatment Technology included a summary of views from across the sector on a number of key concerns facing the industry. Space limitations in the printed guide made it impossible to include all the insights and observations offered by a number of leading suppliers but this fuller version brings together more of their comments to provide a wider understanding of their current thinking.
Under each heading, responses are listed in alphabetical order by company name. The remarks were made during February 2016.
Alfa Laval
We are progressing with the procedures to attain approval under CMFDA/FDA requirements and foresee getting the approval during the second half of 2016 instead of the first half of 2016 as previously estimated.
Cathelco
We already had a strategy in place for testing to the USCG’s live/dead standard. The new round of testing is currently underway at the Marine Eco Analytics facility in Holland. With regard to shipowners, our view is that they will wait for the approval process to work through, defer decisions and apply for dispensations.
Choice Ballast Solutions
We work with both the manufacturer and the shipowner to research the best ballast water treatment system for their ship. BWMS project management has many aspects to it from installation surveys, design and field engineering along with working with Class and Flag for approvals. These activities have kept our team busy and the MPN test method ruling has caused some shipowners who were installing UV systems to seek extensions and/or look for alternative solutions.
Coldharbour
In terms of our own USCG TA testing none at all, but for the market in general I think it is a very big move by USCG. Owners are going to be even more nervous now about making their final choices because whilst MPN, and all the ‘non viable’ argument that sits behind it is most closely associated with UV-type systems, the problem does also affect other technologies, albeit to a lesser degree. Putting USCG at loggerheads with IMO testing (again) is also not good. Hard to see how this will play out fully.
Desmi Ocean Guard
USCG’s rejection is not final. It can be appealed and subsequently also challenged in court. Further, the USCG have stated that they continue to evaluate the method through the ETV process. In the meantime USCG’s decision delays the implementation of ballast water treatment systems as many shipowners prefer to postpone investments until they have more clarity.
ErmaFirst
We believe that for ERMA FIRST, which is using the technology of electrolysis and producing active substances, is a clear sign that our selected technology is sound and effective. Production of chlorine for killing organisms has not been doubted and seems to be the most advantageous nowadays. It’s positive for our customers to realize that we have – from the beginning – invested in the ‘right’ technology and that we have been transparent for the possibilities of our systems. However, the UV MPV method rejection creates uncertainty and doubts in the market and makes shipowners more reluctant. In fact, shipping companies became more anxious as they feel a greater risk before choosing a BWTS. They are trying to narrow their BWTS options and deal only with those manufacturers that provide concrete evidence of their systems.
Evoqua
The USCG’s rejection of the MPN testing method has caused a bit of an uproar in the marine community. Owners who have tentatively selected UV as their best option for treatment are having to go back to revisit this decision. Owners who have already installed UV-based systems are left questioning what they will have to do in the future to remain compliant.
Electrochlorination-based systems are able to test and pass the USCG type approval process using the prescribed staining methods. This means that owners can feel confident that installing an electrochlorination system will keep their vessels in compliance. Many owners who already decided on UV, but have not gone ahead with installation, have come back to electrochlorination suppliers for further evaluation.
Optimarin
The USCG’s rejection of MPN will have a positive effect on our business, driving increased demand for the Optimarin Ballast System (OBS). From the outset, we opted to invest in technology that could satisfy the most stringent approval criteria, which, in this case, is USCG’s ‘alive or dead’ FDA/CMFDA test.
OBS successfully completed a comprehensive range of marine water tests for USCG in 2015 and is now set for full USCG approval in the second half of 2016. The huge 35kw capacity of our UV lamps kills all potentially invasive marine organisms, giving the Coast Guard the clarity of performance they require to protect US waters.
At present, we’re one of just a few UV system manufacturers – with UV being arguably the most environmentally friendly BWT solution – that is close to full USCG approval. That’s a very effective sales argument for our team.
For shipowners that have already chosen a BWT solution ‘only’ capable of satisfying MPN tests, the picture is somewhat less positive.
They have to choose a supplier that they believe can meet USCG requirements in the future. As most manufacturers have only tested according to MPN standards, which USCG has so far not accepted, shipowners may find themselves facing a somewhat difficult situation.
Techcross
The USCG has declined the use of the MPN method for evaluating the biological efficacy of UV-based treatment technologies in ballast water. It is considered that the USCG’s decision may have had a negative impact on some shipowners as well as some UV-based BWMS makers since it could make some shipowners confused about the USCG type approval of current BWMS available.
On the other hand, it could be positive for Techcross since some shipowners which have preferred UV-based technologies seem to start reviewing electrolysis technologies instead.
Trojan Marinex
We are hopeful that sound science and environmental protection will ultimately prevail in the US, and the USCG’s preliminary decision on the MPN method will be reversed. We are proceeding with an appeal, and considering all options in our pursuit of USCG Type Approval.
Unfortunately, for shipowners, this preliminary decision has cast unnecessary confusion and has essentially left them with no practical UV-based treatment options. We believe that shipowners are now in an increasingly difficult position of having to accommodate an approaching installation schedule, even though no USCG type approved systems are currently available and the alternatives to UV may be prohibitive and costly to many segments of the retrofit market.
Wärtsilä
The recent USCG statement on the MPN test method is a regulatory ruling and as such should not form part of any type approval. This has contributed to increased confusion with shipowners, who find it more difficult to make any BWMS decisions. Wärtsilä have approached testing of Aquarius-UV with some caution, noting the IMO type approval was successful utilising a staining method, not MPN. Wärtsilä’s approach with USCG type approval is to adhere to the stated definitions within the ETV.
Alfa Laval
IMO standards are applied to many of our customers. The ones affected by the USCG requirements are the vessels visiting US waters.
Cathelco
There may be a small market for BWMSs that meet the IMO’s standard but not the USCG’s, depending on the extent to which the revised G8 guidelines harmonise with the USCG’s. We believe that the USCG standard will set the level for the international standard.
Choice Ballast Solutions
While the requirements for USCG type approval may be more stringent at this time, there is the expectation that IMO test methods will undergo a revision sometime in the near future. If this is the case, BWMS manufacturers should anticipate the need to comply with more rigorous standards in their technology worldwide. While the USCG standards are not the de facto international standard, we do see a predominant inclination from shipowners for a USCG-certified system.
Coldharbour
I think many people assume that this will be the case. I know of some vendors who insist that USCG testing is something that they are not going to look at, but the reality is that having two different certification schemes, both enforceable, is unworkable if the requirements remain as diverged as they currently are.
ErmaFirst
This will depend on the number of USCG type approved systems as well as the timing these approvals will be issued. We may actually see different standards and have a few BWTS makers whose target group could only be ships that are not sailing to USA. It’s obvious that USCG type approval will be the major selection criterion for the shipping industry as it will provide confidence to shipowners and minimise the anticipated risk. It will provide owners with a higher level of security while for the makers it will become a real asset and their number one marketing tool. Those makers that will finally not be approved by USCG will gradually lose their impact in the market because of lack of confidence.
Evoqua
There is the potential for a market for IMO type approved only systems. Many vessels are purpose built and will never enter US waters. The challenge will be for how long these systems will be acceptable. There is already talk at IMO of changing the G8 guidelines for obtaining IMO type approval. The proposed changes seek to harmonise the IMO testing with that of the more stringent USCG testing. No one can be certain what the future standards will require, or if systems will be grandfathered under the old requirements, but this uncertainty should lead owners to installing equipment that meets the highest standards.
Optimarin
USCG has set the de facto standard for BWT systems. If shipowners, especially those with large fleets, want the flexibility of trading in US waters then they must choose a USCG compliant system, full stop.
That’s not saying there won’t be a market for MPN/IMO compliant systems, but it will be greatly impacted.
Techcross
Although USCG has declined the MPN method by which some UV-based system makers applied for their USCG TA testings, it is understood that they may appeal the USCG’s decision.
How the USCG will respond to their appeal remains to be seen. If the USCG does not accept their appeals, however, it is expected that a possible market for the UV-based system relying on the MPN method will be limited to member nations following the IMO convention except for the US territory.
Trojan Marinex
There are some shipowners who need a USCG type approved system, some who simply want a USCG type approved system, and then the majority who only need an IMO type approved system. For many years, the IMO has recognised MPN as an appropriate method to determine treatment system efficacy, and thousands of vessels already employ IMO type approved UV-based systems – the vast majority of which were tested using grow-out methods such as MPN.
The current review of IMO’s guidelines (G8) appears to be narrowing the gap between the two standards. However, the USCG’s preliminary decision on the MPN method has added a significant obstacle in this process and consequently discounts an entire group of solutions that render organisms harmless to prevent the introduction and spread of non-indigenous species.
Wärtsilä
With regard to the performance standard, IMO and USCG have identical numeric values. However, shipowners not trading in US waters have no need to purchase equipment that fulfils USCG specific requirements.
Alfa Laval
We are progressing with the procedures to attain approval under CMFDA/FDA requirements and foresee getting the approval second half of 2016 instead of first half of 2016 as previously estimated. As a major player within the marine industry, Alfa Laval has the ability to absorb the costs for additional testing.
Cathelco
We are aiming to achieve USCG type approval by early 2017.
Coldharbour
2017 – and far too much money!
ErmaFirst
In ERMAFIRST, we feel confident that we have chosen a well known and mature technology that has proven its ability to satisfy USCG regulations and testing requirements according to strict ETV protocol. We are close to USCG type approval after the successful completion of a series of tests including shipboard and land based. Costs associated with the USCG type approval are significant and the delays in type approval decisions puts a lot of pressure on makers that have spent huge amounts of money for various necessary approvals (IMO, Class, USCG ) while the market has not yet opened.
Evoqua
Last year, Evoqua become the first company to complete low salinity (brackish) water testing in the USA for ballast water management solutions as part of USCG protocols through an independent laboratory. Testing for the SeaCURE™ system was completed at the Marine Environmental Resource Center (MERC) in Baltimore, Maryland under rigorous conditions that replicate the environment in which the system will be operating. We are in the process of completing land-based testing in the other two salinities, as well as the shipboard testing, and we expect to have our USCG type approval before the end of the year.
The testing costs will run into the millions of dollars for a company seeking to obtain a USCG type approval. The willingness of a company to invest such a large amount of time and money demonstrates its commitment to the market, as well as confidence in its system.
Optimarin
We’re now within touching distance of full USCG approval. OBS has satisfied all marine water requirements and the remaining tests should be completed, leading to the end of what has been a very comprehensive process, in spring this year. All testing has been conducted by DNV GL.
The costs are clearly restrictive. Unlike a lot of companies in this segment, we’re a relatively small business that is 100% focused on BWT – that is all we do, and all we’ve done since starting up in 1994. That means we don’t have the money to divert from other parts of our organisation that may have greater revenues. That said, it’s an investment.
The whole process has cost Optimarin millions of dollars, but it gives our customers a ‘ticket to trade’ in a crucially important market. That’s worth a lot to them and, in terms of our future development, could be priceless for us.
Techcross
Techcross is scheduled to begin land-based and shipboard testing from the second quarter of 2016. Ultimately, Techcross is planning to get USCG type approval in the first half of 2017.
It is thought that the process for the USCG type approval testing in the independent laboratories designated by the USCG requires a considerable amount of money.
We think that it could be a big burden on some makers with low sales records.
Wärtsilä
We expect USCG type approval for Aquarius-EC late in 2016 and for Aquarius-UV in 2017. Costs are set by the IL’s with little influence by the vendors. If a business wishes to stay in the BWMS market it has no choice but to invest.
Alfa Laval
We have a high number of enquires and have not seen any major change over the last 12 months.
Cathelco
More owners are starting to plan for the installation of BWMS, but the levels of purchasing activity still remain low.
Choice Ballast Solutions
Choice Ballast Solutions saw an increase last year when more and more owners realised the length of time necessary for the planning and installation of a BWMS. While not necessarily choosing the BWMS, shipowners started the survey and design phase of the process in order to better plan, cost-out, and line up the services necessary through to the commissioning of the vessel. We did see an increase in proposal activity in the 4th quarter of 2015, but then with the USCG rejection of the MPN method and insufficient tonnage for ratification many proposals were put on hold.
Coldharbour
Yes, absolutely.
Desmi Ocean Guard
Yes, we saw increased interest and activity. The news that the BWMC is in fact still not ratified has however returned interest and activity to the same level as before November 2015.
ErmaFirst
Yes we have seen that after the latest information in November, shipping companies were alerted and interested in the final decision of ratification. News spread quickly. However, we expect that it will soon be a fact.
Evoqua
Owners and operators are still hesitant in the market place. As yet there are no USCG type approved systems, therefore it would seem plausible that owners are waiting to see which systems will get this certification before making any decisions to ensure that their choice is a one-off purchase. In general, as an organisation, we are seeing more interest from owners, as it is clear that the regulation is coming and they are wanting information to make an informed decision. This ultimate choice is based not only on the technology but on the company providing the technology.
Optimarin
Yes we have. 2015 was not as busy as we would have liked, but towards the end of the year and into 2016 business has really taken off. We’re seeing more in-bound enquiries, a greater willingness to discuss BWT and, essentially, more signed contracts. There’s an air of inevitability about ratification now and that’s acting as a catalyst for forward-thinking shipowners who know they have to start planning ‘now’. The issue can’t be ignored any longer.
Fleet agreements have been a real area of success for us, fuelled by our proven technology, retrofit expertise and, of course, the fact that USCG approval is now so close.
Techcross
Although the IMO provided official confirmation that the criteria still has not been met for the Ballast Water Management (BWM) Convention to enter into force in February 2016, as the time for ratification is closer, many shipowners started to show interest in BWMS retrofits. We expect to get more enquiries from many shipowners sooner or later since the Panama delegation to the IMO made an announcement that they have advised their government and parliament to sign the Convention recently.
Wärtsilä
Yes we noted increased interest, particularly with retrofit considerations by the larger fleets.
Alfa Laval
Externally, we are training partners to be ready for the retrofit boom. Internally, we are building and maintaining an organisation of dedicated service engineers globally.
Cathelco
Our plan is to recruit additional staff in terms of system design and manufacturing.
Choice Ballast Solutions
We can’t wait. In response to the anticipated surge in projects, Choice Ballast Solutions and Drew Marine have signed a collaboration agreement, creating the Choice Alliance. The Choice Alliance also includes naval architecture and marine engineering firms Netsco and Argo Navis. We have all steadily added engineering personnel throughout 2014 and 2015. The Choice Alliance will continue to add technical personnel in 2016 to meet the demand for engineering and related services once the BWMC reaches its target.
Coldharbour
We are that manufacturer!
Desmi Ocean Guard
Yes, we have ready-to-execute ramp up plans including recruitment of staff, but also to increase manufacturing facilities etc.
ErmaFirst
ERMA FIRST has an enhanced company structure built from strong co-operations, alliances and relationships. Personnel will be required in the future for the processing.
Evoqua
Evoqua has been actively recruiting in the market so we are prepared before ratification reaches its target. However, it could be said that more important than internal recruitment, is ensuring the customer is going to be supported throughout the process. To supplement internal expertise, Evoqua has partnered with a number of renowned organisations. Damen provides engineering and installation supervision, Drew Marine provides servicing and presence in 900 ports and more locally to South Korea, Krosys provides systems, engineering, installation and support to the market. Our goal is to be fully-trained and ready before the retrofit boom hits.
Optimarin
We’re viewing the situation with a mixture of optimism, realism and the caution that 12 years of awaiting ratification naturally dictates. We are planning growth, but that growth will be carefully managed and according to our predetermined business plan. Optimarin is here for the long run and aims to build its foundations carefully and solidly to support that vision.
Techcross
Techcross has prepared for possible big demands starting from 2015 by having completed a new factory in Busan, Korea with increased production capacity of up to 1,000 systems per year as well as by increasing its workforce according to expected ratification period of IMO BWM Convention.
Wärtsilä
We are recruiting now.
Alfa Laval
The number of manufacturers is hard to foresee. The manufacturers that have the ability to offer global services over the long-term post the retrofit boom will for sure be present.
Cathelco
We think that there will be far fewer manufacturers than there are today. However, there is scope for a variety of technologies to serve the needs of various types and sizes of vessels.
Coldharbour
No more than 10 – 15.
Desmi Ocean Guard
About 5 to 10 manufacturers.
ErmaFirst
We have seen in the past that companies appear only for the implementation of regulation on existing ships. Then, due to the lack of experience, resources and vision for the future, they leave the market. This has an impact later on the final decision/selection, since the after sales is extremely important.
Evoqua
We have already started to see the contraction of suppliers, which was inevitable. Many companies simply copied existing technologies and expected to cash in on the potential market. As the delays mount, many of these companies are dropping out of the race. We expect 20-30 companies to survive the contraction and service the retrofit market. After the retrofit market finishes, there will be another large contraction that will most likely leave 10-15 suppliers to service the new build and re-retrofit market. The surviving companies will be the ones that are properly prepared for the long haul and that realised that this race is not a sprint but rather a marathon.
Optimarin
That’s a good question, and a difficult one to answer. There will, without doubt, be a wave of consolidation in the marketplace, with mergers, takeovers and some suppliers choosing to exit and focus on other core business streams. I’d suggest that those with market-proven, reliable and effective technology will build customer bases strong enough for a sustainable future, while those that see this as a way to exploit a market opportunity will fall by the wayside.
In terms of a number, maybe somewhere close to ten, with enough manufacturers to provide healthy competition across all ship sizes, segments and geographical locations. Optimarin, of course, will be one of them!
Techcross
We assume that a few top makers with a high market share in this industry and a competitive edge in other fields will survive even after the BWMS retrofit boom passed. Therefore, it would be more important for shipowners to select a reliable BWMS maker with its competitiveness in this field.
Wärtsilä
It is likely that there will be market consolidation and the number of BWMS vendors will reduce. Wärtsilä firmly intent to be in the BWMS market for the long term.
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