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The Countdown to IMO 2020

On January 1, 2020, the International Maritime Organisation (IMO)’s rules on sulfur emission are due to come into force – a move which will have a monumental impact on the shipping industry.  

This legislation will ban any ship from emitting more than 0.5% of sulfur in its fuel, a cut of almost 3% from the current level. Therefore, planning for the implementation will be one of the industry’s biggest challenges in 2019.

In this exclusive insight, PTI has explored the reasons behind the new rules and how some of the world’s biggest carriers are preparing for them.

The IMO’s motivation is clear – the shipping industry, while invaluable to the global economy, is one of the biggest polluters in the world.

It contributes 17% of the world’s CO2 annual emissions and 8% of its sulfur output. The former could, according to the EU, could rise to 50% by 2050 unless action is taken.

This is because, as things stand, the shipping industry relies on sulfur-heavy heavy fuel oil (HFO) and has done for decades.

Estimates vary but it is believed that the IMO’s regulations will cost the shipping industry between US $60 – 200 billion.

Carriers have devised various ways of complying with the laws, which may turn out to be beneficial to business, as well as the environment.

The biggest has been a move towards new fuels, such as liquefied natural gas (LNG) which has the potential to reduce shipping times and improve efficiencies.

Carriers have also been searching for eco-friendly innovations. Japanese carrier MOL, which recently merged into Ocean Network Express (ONE), for example, unveiled plans six new technologies in August 2018.

These included water treatment systems, sulfur scrubbers, LNG-fuelled vessels and even plans to use electric sails on container vessels, which it hopes to launch by 2020.

This is just one of the big innovations that the industry is looking at. Others include new hybrid cleaning systems, which will reduce the output of dirty chemicals, and even cryptocurrencies.

On December 5, the world’s biggest carrier A.P. Moeller-Maersk announced plans to go above and beyond complying with the IMO’s 2020 rules when it set a target of having carbon neutral vessels on the seas by 2030.

That is part of the company’s plans to achieve a completely carbon-free fleet by 2050 and called on the rest of the industry to “join forces” and find new ways of keep trade moving while protecting the environment.

2019 will be dominated by the shipping industry’s preparations for January 1, 2020. It has already inspired a raft of technological innovations which could become fixtures of the sector for years to come.

Source: Port Technology

LNGHIVE2 Project to promote LNG use in Spanish Ports

A project which will promote the use of LNG as fuel in Spanish ports has been selected by the European Commission (EC) for funding.

The EC will contribute approximately EUR3m to the EUR14m ‘LNGHIVE2: Infrastructure and Logistics Solutions’ project to encourage LNG in maritime and rail transport, coordinated by energy company Enagás and promoted by the Spanish Govenment’s Ports of the State. The project includes the adaptation of the regasification plants of Huelva and Sagunto (Valencia) so that they can offer LNG supply services as fuel.

With an expected end date of 2022, the initiative will also introduce LNG in the ‘Green Railway Corridor’ between the Port of Huelva and the railway terminal of Majarabique, of ADIF, in Seville. In particular, the project includes the construction of a LNG supply station in said terminal and the conversion of a diesel traction locomotive to LNG.

LNG supply points

Aside from Enagás and Ports of the State, six partners are participating in the project, including the Port Authority of Huelva, RENFE Mercancías, ADIF, Saggas, Marflet Marine and Valencia Port Foundation.

‘LNGHIVE2 is part of the institutional strategy of deploying LNG supply points in ports and associated market development, promoted by the Ministry of Public Works through State Ports. Under this strategy, a Balearia initiative consisting of the conversion of five vessels for the use of LNG as fuel has also been selected.

LNGHIVE2 is one of the measures of the National Action Framework for Alternative Energies in Transport approved by the EU’s Council of Ministers in December 2016 and aims to comply with Directive 94/2014 of the European Commission, which represents a clear commitment to alternative fuels in the transport sector.

Enagás is currently also coordinating CORE LNGas hive, led by Puertos del Estado.

Source: Green Port

A sustainable maritime industry in a 2°C scenario – has the ship already sailed?

Shipping has long been a fundamental enabler of trade, although its important role may go unnoticed. Think about where the clothes you are wearing were made and how they arrived here. What about your phone? How did its components all come together to reach your hand right now? It’s very likely that shipping played a role in both examples. How is this all made possible?

Containerisation, a system of multimodal transport storage, means that ships remain the cheapest and most efficient transport method. Today, they can carry tens of thousands of containers around the globe with only a small crew.

The industry has been growing at a remarkable rate. Already producing 2.5% of global carbon emissions, this industry is expected to grow by between 50% and 250% by 2050. Shipping fuel is often much more dense and polluting than that allowed on land, presenting an environmental challenge that needs to be met by more sustainable measures in the shipping industry.

WHERE ARE WE NOW?

The acclaimed Paris climate agreement in 2015 achieved great success in establishing binding carbon targets by sector. However, due to extensive lobbying of the International Marine Organisation (IMO), shipping was the only sector excluded from legally binding emissions reductions. This has impacted the drive towards developing more sustainable fuels and shipping systems, despite the IMO committing to some form of carbon reductions.

As a result, international shipping legislation around environmental impacts has been slow. But there has been some progress. A recent development was the introduction of a lower sulphur content cap for shipping fuels from 3.5% to 0.5% from 2020, with an aim to improve air quality near ports and shipping routes.

Environmental legislation is increasingly coming from regional and local levels, although its impacts are felt at a global scale. A notable example is the EU, which has declared that any ship over 5,000 tonnes must monitor, report and verify their annual carbon emissions from 1 January 2018. This drive for sustainability has come from individual ports as well. For instance, the Port of London Authority has introduced a 5% discounted green tariff for more environmentally friendly ships.

WHERE ARE WE GOING?

These examples look set to become trends, with increasing responsibility being taken by port authorities. The World Ports Sustainability Programme (WPSP) was launched in March this year, aimed at creating holistic sustainability plans for ports to shape the shipping sector thorough a series of tariffs, investment, efficiency improvements, and bans.

There has been much innovation regarding clean-energy shipping, including the soon-approaching world-first electric, driver-less barge; hydrogen-powered shipping; and a solar-powered bulk-carrier ship. However, these technologies are unlikely to contribute significantly to carbon reductions in the shipping sector any time soon. The near future of sustainable shipping therefore looks increasingly based around new fuel blends, efficiency measures, and taxes. Unlike road fuels, marine fuels are currently not taxed, and a CO2 tax is gaining momentum worldwide. This method helps to drive the cheapest emissions reductions, through optimisation of shipping speeds, fuel shifts and efficiency improvements.

The sector is facing some big changes, although the mechanisms remain unclear. If sustainable shipping is to make a tangible contribution to global climate targets, both international legislative pressure and bottom-up regional and port-led initiatives will need to be ambitious, economically viable, and aligned.

Action or inaction in the industry will also have significant consequences for the outcomes of the Sustainable Development Goals (SGDs), most notably SDG 13 on climate action and SDG 14 relating to life below water. The maritime industry will need to play an integral role in development that conserves our oceans and marine resources, an essential requirement for a sustainable future.

Source: Hellenic Shipping News

ESPO publishes its position paper on the port reception facilities for ship waste

For European ports, ship waste has been one of the main environmental priorities, as indicated in the ESPO 2017 Sustainability Report.

In its position paper on the revision of the Port Reception Facilities Directive, ESPO welcomes the Commission proposal and its objective to build upon the substantial progress achieved under the existing Directive. The existing Directive 2000/59 has contributed to decreasing significantly waste discharges at sea. The minimum fixed fee, which has to be paid by all ships calling at EU ports, regardless of whether they use the waste facilities or of the quantities they deliver, has delivered. As a result, only 2.5% of oily waste is not delivered at waste facilities in ports.

European ports support, in particular, the proposal’s objectives to increase efficiency and reduce administrative burden. The new Directive should, however, also make sure that efficient but responsible regime for managing ship waste is encouraged, in line with the ‘polluter pays’ principle.

European ports recognise that providing the right incentives is essential and port authorities are certainly willing to contribute. However, introducing a fee system whereby ships could deliver unreasonable amounts of garbage, including dangerous waste for 100% fixed fee, would be a severe and unacceptable divergence from the ‘polluter pays’ principle. It risks to discourage tackling waste at the source by reducing waste volumes onboard, which has been the cornerstone of the EU waste policy” says ESPO’s Secretary General, Isabelle Ryckbost.

ESPO therefore proposes to set a limit on waste covered by the 100% fixed fee. The fixed (flat) fee should cover normal quantities of waste delivered by a certain type and size of ship.  Ports should be allowed to charge on top of that if unreasonable quantities are delivered. Furthermore, dangerous waste, which usually needs special and costly treatment, should not be covered by the 100% indirect fee.

European ports believe, moreover, that any provisions leading to better enforcement of the obligation for ships to deliver waste at shore are welcome. The alignment of specific elements of the Directive with the International Convention for the Prevention of Pollution from Ships (MARPOL) is supported by ESPO. European ports also welcome that new types of waste, such as scrubber waste, have been addressed by the proposal.

The proposal is currently being discussed in the Council and the European Parliament. ESPO looks forward to working with the Parliament’s rapporteurs and the shadow rapporteurs, the Bulgarian Presidency, the Council and the Commission in view of achieving a new and efficient legislative framework that would further reduce ship generated waste discharged at sea and increase waste quantities delivered at ports.

The document can be downloaded from the ESPO website.

Source: ESPO Press Release

Five Facts About Sustainable Ship Recycling

Despite recycling a majority of tonnage annually, South Asian countries have been repeatedly questioned about the environmental viability of such activity. This is despite the fact that almost everything on an end-of-life and the ship itself is recycled and reused, which adds to the sustainability of our natural resources.

Below, five facts are shared which exemplify the meaningful contribution of the ship recycling industry towards the environment and the society.

1. Boost to Local Economy

The ship recycling industry in South Asia is associated with a huge downstream market for second-hand goods such as furniture, machinery, joinery, electrical equipment, household appliances, home décor, paints, hardware items, etc. This supports the concept of industrial ecology or industrial symbiosis as the outputs from ship recycling yards are utilized as inputs to small-scale industries working to refurbish items which are eventually traded in the second-hand market.

All this is in addition to the steel re-rolling mills and steel melting mills which utilize ferrous scrap from end-of-life ships to produce steel goods such as bars, ingots, pipes, plates, etc. The entire localized industry developed due to ship recycling yards is a major boost to the local economy, as it assists in flourishing of trade of second-hand goods, ferrous scrap and non-ferrous scrap. At the same time, a large number of jobs are also created.

2. Creation of Jobs

The nexus of ship recycling yards, refurbishing shops, re-rolling mills, steel mills and second-hand shops creates a localized industry which employs hundreds of thousands of people from marginalized segments of the society. These jobs include both semi-skilled and unskilled workforce working at ship recycling yards dismantling and cutting end-of-life ships and at other downstream industries discussed above. According to the World Bank estimates, “the work force in each country varies with the volume of ship breaking but may range from 8,000–22,000 workers in the ship recycling yards to 200,000 in the supply chain, shops, and re-rolling mills.”

3. Recovery of Metal Scrap

The metal scrap obtained from end-of-life ships includes both the ferrous scrap and non-ferrous scrap. The ferrous scrap is generally classified in two ways – re-rollable scrap and melting scrap. In South Asian ship recycling yards, about 60 percent of the total weight of the ship’s steel is obtained in the form of re-rollable scrap. This comprises of plates, beams, girders and angle bars.

The re-rollable scrap is sold at a premium compared to the remaining 40 percent which is comprised of the irregular pieces of steel earmarked as melting scrap. The re-rollable products are generally used in the construction industry of these countries whereas the melting scrap is used to form finished steel products in a foundry.

In South Asia, the recovery of re-rollable and melting scrap steel by the ship recycling industry and its eventual supply for the iron and steel industries is critical because more than half of Bangladesh’s steel supply is fulfilled via this route. Similarly, for Pakistan and to some extent to India as well, the importance of the ship recycling industry for supplying scrap to the iron and steel industry is immense.

For example, in 2011 about 688,000 tons and 2.7 million tons of ferrous scrap was supplied by the ship recycling industry to the steel making industry in Pakistan and India, respectively. On a global basis, since 2011, every year at least seven million tons of metal scrap is produced by the ship recycling industry. This figure touched the 11 million ton mark in the year 2012 when a record number of ships were dismantled globally.

4. Reduced Greenhouse Gas (GHG) Emissions

The positive effect of using scrap metal to produce finished products instead of using metal ore is seen in terms of reduced GHG emissions. The emissions reduction is due to the reduced energy consumption by up to 70 percent in steel making using scrap steel as compared to using iron ore. Moreover, the need for metal mining is also diminished, which adds to the reduction of the GHG emissions.

This is an important contribution of the ship recycling industry towards sustainability because the world needs to find ways to decarbonize the atmosphere in the wake of the issues such as global warming, depletion of the ozone layer and climate change.

5. Reduced Pollution

The recycling of steel scrap obtained from end-of-life ships also helps reduce air and water pollution. At the same time, it helps reduce water consumption. These reductions are due to fact that fewer resources are required to manufacture products from metal scrap as compared to metal ore. Scientifically published estimates suggest 86 percent less air pollution, 76 percent less water pollution, 40 percent reduction in water usage while making steel from scrap than from iron-ore.

The above aspects of the global ship recycling industry corroborate the fact that generally the industry is beneficial for the environment and the society. However, doubts have been raised by some on the manner in which ships are dismantled on some yards in the Indian sub-continent. The way ships are dismantled can definitely have consequences on environment and health and safety of the workers. Therefore, the need to improve the substandard facilities cannot be refuted.

At the same time, labeling yards HSE friendly or not on the basis of their geographical area cannot be justified: especially when almost half of the active yards in India have voluntarily upgraded their facilities to obtain the statements of compliance with the Hong Kong Convention from IACS member classification societies.

Dr. Kanu Priya Jain is Coordinator for Responsible Ship Recycling at GMS (Dubai).

Source: Maritime Executive

Global shipping in ‘historic’ climate deal

The global shipping industry has for the first time agreed to cut its emissions of greenhouse gases. The move comes after talks in April at the International Maritime Organization (IMO) headquarters in London.

Shipping has previously been excluded from climate agreements, but under the new climate deal, emissions will be reduced by 50% by 2050 compared to 2008 levels.

One minister from a Pacific island state described the agreement as “history in the making”.

Shipping generates roughly the same quantity of greenhouse gases as Germany and, if it were accounted for as a nation, would rank as the world’s 6th biggest emitter.

Like aviation, it had been excluded from climate negotiations because it is an international activity while both the Kyoto Protocol and the Paris Agreement involved national pledges to reduce greenhouse gases.

The United States, Saudi Arabia, Brazil and a few other countries had not wanted to set a target for cutting shipping emissions at all.

By contrast the European Union had pushed for a cut of 70-100%.

So the deal for a 50% reduction is a compromise which some argue is unrealistic while others say does not go far enough.

Kitack Lim, secretary-general of the International Maritime Organization, who had chaired the controversial talks, said: “This initial strategy is not a final statement but a key starting point.”

The tiny Pacific nation of the Marshall Islands had opened the conference with a plea for action. Although it has the world’s second largest register of shipping, it had warned that failure to achieve deep cuts would threaten the country’s survival, as global warming raises sea levels.

As the talks concluded, the nation’s environment minister David Paul said: “To get to this point has been hard, very hard. And it has involved compromises by all countries. Not least by vulnerable island nations like my own who wanted something, far, far more ambitious than this one.”

Mr Paul added: “This is history in the making… if a country like the Marshall Islands, a country that is very vulnerable to climate change, and particularly depends on international shipping, can endorse this deal, there is no credible excuse for anybody else to hold back.”

Laurent Parente, the ambassador of Vanuatu, also a Pacific island nation, was not satisfied but hoped the deal would lead to tougher action in future. “It is the best we could do and is therefore what this delegation will support as the initial strategy that we have no doubt will evolve to higher ambitions in the near future.”

By contrast, the head of the US delegation to the talks, Jeffrey Lantz, made clear his country’s opposition to the deal. “We do not support the establishment of an absolute reduction target at this time,” he said. “In addition, we note that achieving significant emissions reductions, in the international shipping sector, would depend on technological innovation and further improvements in energy efficiency.” Mr Lantz reiterated that the US, under President Trump, has announced its withdrawal from the Paris Agreement on climate change. He also criticised the way the IMO had handled the talks, describing it as “unacceptable and not befitting this esteemed organisation.”

But a clear majority of the conference was in favour of action.

The UK’s shipping minister, Nusrat Ghani, described the agreement as ” a watershed moment with the industry showing it is willing to play its part in protecting the planet”.

The move will send a signal through the industry that rapid innovation is now needed. Ships may have to operate more slowly to burn less fuel. New designs for vessels will be streamlined and engines will have to be cleaner, maybe powered by hydrogen or batteries, or even by the wind.

Author: David Shukman, BBC Science Editor

Source: BBC News

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