Page 57: of Maritime Reporter Magazine (October 2018)

No Worries Mate!

New Fuel Rules: Behind Supportive Front, Industry Frets About Cost, Strategy, Supply

There are studies and reports from and fuel cells) to be used for anything Agreement’s “well-known below two- classi? cation societies, scienti? c or- beyond short-sea shipping or speci? c degree goal.” It will use a tool called the ganizations and governmental agen- route-bound passenger vessels (ferries Terra Approach to measure “the needed cies assuring maritime industries that and tour boats). shift in technology against the actual carbon-heavy fuel is peaking and will • Cost: How they are going to pay for technology clients are using today and be replaced by 2050, if not by 2035, these upgrades and changes in fuel? plan to use in the future.” ING says with zero carbon power alternatives. And which solutions will investors and banks have a responsibility to ? nance

No question, they chorus, shipping can insurers favor - key in an industry run- “positive change,” and it plans to do just meet the IMO goals of a 50% reduction ning on multi-millionn dollar vessels with that, steering clients toward investments in 2008 levels of GHS by 2050. multi-decade lifespans that take multiple in environmentally-driven upgrades and years to produce. And whose greatest strategies. Shipping, take note.

But as the hot breath of various expense currently is fuel. deadlines bear down upon them, with And, throwing a possible monkey the 2020 sulfur cap in the forefront, Shipping giant A.P. Moller-Maersk wrench into the move toward low-sulfur ship owners, operators and ? nan- A/S predicts the sulfur emissions last month was a group of ? ag states ciers are starting to worry aloud. cap will explode annual fuel costs and shipping organizations, including industry wide by at least $50 billion. BIMCO, Intertanko, Intercargo, Pana-

Their unease is driven by several The company expects its share will total ma, Liberia and some island states, who things: regulators’ banking on a belief $2 billion in 2020, and it’s not willing joined together to request a “test phase” that there will be as yet unknown dis- to shoulder that cost alone. It plans to be established before the implementa- coveries that will provide solutions, a charge clients separately for fuel for the tion of the 0.5% cap on sulfur-carrying feared lack of infrastructure or supply ? rst time starting in 2020. fuels for vessels without a scrubber suf? cient to fuel eco-conscious ves- system. They cite fuel safety and quality sels, and the ? nancial burden of making ING Bank announced that it will be look- concerns. the switch – especially if they choose ing to steer its clients and lending activi- the wrong strategy and or standards ties toward support for the Paris Climate by Patricia Keefe change down the road after they’ve committed to a solu- tion. Oh, and those solutions will have to be geared to meet the demands of speci? c vessel categories, and increasingly, environmentally-conscious ? nanciers who have require- ments of their own in order to secure loans.

Among the complaints that have surfaced: • Engine Failure: The potential for engine failure in hybrid ves- sels if fuels get mixed during the switch over.

• Scrubbers: One alternative to expensive low sulfur fuel, they are expensive themselves, don’t necessarily fully resolve or dispose of pollutants, and are seen as a short-term invest- ment solution that will have to be replaced sooner than later.

• Limits: That some options under scrutiny today are limited to certain markets, can only be used in conjunction with an- other solution, and or are not powerful enough (i.e. batteries

Maritime Reporter & Engineering News, October 2018 th

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