Page 43: of Maritime Reporter Magazine (January 2019)

MARITIME EMISSIONS • Technology Choices & Cost Considerations

Low sulphur fuels, scrubbers, LNG or other alternative fuels; picking the tech is one matter, paying for it quite another

By Barry Parker

By any measure, the business of running the regulation goes into effect.” vessels will not be the same after Janu- All that said; the precise magnitude, and ary 1, 2020, when the present 3.5% limit even the directions of impacts on shipping on sulfur content will ratchet downward company’s bottom lines, is not known. to 0.5%. With the implementation date The unknowns are dictated by normally for the changes, enacted in late 2016 by unpredictable shipping market forces and the International Maritime Organization by exogenous impacts of business deci- (IMO) and recently reiterated in the face sions of oil re? ners and downstream par- of challenges by shipping organizations, ticipants, all of which impact available less than one year from now, cost struc- supplies of compliant fuels.

tures will certainly change. The $250/ton number, and variability

Roughly, what will the increased costs surrounding it, does not address strategic be? Using a thick crayon on the back of an advantages may be gained (or lost) rela- envelope, we could estimate that 50,000 tive to competitors, who may adapt dif- deepsea ships burning an average of 30 ferent business strategies than their peers. + tons/day of residual fuels, operating Outcomes are not static; they may move 250 days/year in international trades, will around in a dynamic marketplace.

need to pay an extra $250/ton (a reference number in line with recent price differen- Who Pays the Bill?

tials) for fuel – a ? gure Indeed, the pro? t number emerging approaching a stagger- from the income statement starts with

Crowley has been a leader ing $100 billion annually the top line, and leverages the uncertain in the adoption and integration – with all else held con- proportion of cost increases that can be of ‘green’ tech across its