Page 39: of Maritime Reporter Magazine (June 2013)

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www.marinelink.com 39of marine transportation services. This analysis is limited to the impacts of in-creases in operating costs due to the fuel and emission requirements. Operating costs would increase due to the increase in the price of fuel, the need to switch to fuel with a sulfur content not to ex-ceed 1.0% while operating in the wa-terways covered by the engine and fuel controls and due to the need to dose the after treatment system to meet the Tier 3 standards. Table 6 summarizes these price impacts for selected transportation markets. Table 6 also lists the vessel and engine parameters that were used in the calculations.The total social costs of the coordinat-ed strategy are based on both Þ xed and variable costs. Fixed costs are a cost to society; they displace other product de-velopment activities that may improve the quality or performance of engines and vessels. In this economic impact analysis, Þ xed costs are accounted for in the year in which they occur, with the Þ xed costs associated with the Tier 2 engine standards accounted for in 2010 and the Þ xed costs associated with the Tier 3 engine standards and the fuel sul- fur controls for vessels operating on the waterways covered by the coordinated strategy are accounted for in the Þ ve-year period beginning prior to their ef-fective dates.These estimated social costs for all years are presented in Table 7. For 2030, the costs are estimated to be about $3.1 billion. It is expected that consumers of the marine transportation services will pay for these costs. Additionally, con- sumers will pay prices for the goods transported by sea.The EPA estimated annual monetized health beneÞ ts of Annex VI (Revised) in 2030 will be between $110 - $270 billion, assuming a 3% discount rate (or between $99 - $240 billion at 7% discount rate). EPA believes by 2030 emission reduc- tions associated with the ECA will an- nually prevent: between 12,000 - 31,000 premature deaths, about 1,400,000 work days lost: and about 9,600,000 minor restricted-activity days. Furthermore, the EPA predicts the following impor- tant ecosystem beneÞ ts: NOx, SOx and direct PM reductions reduce deposition in many sensitive ecosystems, improve visibility ? especially in Class I federal areas; and reduce ozone damage to many ecosystems throughout the U.S. The bottom line is every consumer will be paying more for the goods used in ev-eryday life and more in taxes for govern-mental regulatory enforcement in order reduce NOx, SOx, and PM in the atmo-sphere. Finally, under the law of unin- tended consequences, will this cause a consolidation in the industry? The larger carriers could absorb some of these ad-ditional costs, potentially squeeze out smaller carriers and then purchases these assets and make up proÞ ts on the back end. We are seeing a similar scenario playing out in the airline industry. Gary English is President of Marine Forensic & Investigation Group, LLC. Mr. English focuses on Marine Accident Investigation, Forensic Analysis, Risk Assessment & Management, Regulatory Compliance, Expert Testimony, Consult- ing and Mediation Services. Mr. English graduated from the United States Naval Academy with a Bachelor of Science in Applied Science, the Naval Postgradu-ate School with a Master of Science de-gree in Applied Science and the Charles- ton School of Law?Cum Laude.MR #6 (34-41).indd 39MR #6 (34-41).indd 395/30/2013 1:05:52 PM5/30/2013 1:05:52 PM

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