Environment-friendly bunker fuel not worth it
Shipping lines whose vessels operate in the seca zones in Northern Europe will face increasing costs from 2015 for bunker fuel with a low sulphur content. Fines for offenders exceeding permitted levels vary greatly – which has startling consequences.
On 1 January 2015 the maximum allowed concentration of sulphur in bunker fuel used by ships sailing through the English Channel, the North Sea and the Baltic Sea will be lowered from 1%, the level which currently applies, to 0.1% (see also ITJ 9-10/2014, page 16). Fines that can be levied on offenders exceeding the maximum permitted levels bear all too little relation to the costs for the new type of fuel, the Danish analyst SeaIntel has warned in a recently-published study. According to these findings there may be a lack of incentives for shipping lines whose units sail through these regions of Northern Europe to switch to more environment-friendly fuels.
Offenders can get away
SeaIntel also investigated the number of fuel inspections the authorities from the various countries in the regions concerned performed on ships sailing through the sulphur-emission control areas, the so-called seca zones, every year. The analyst found out that less than 1% of vessels sailing in the seca zones had their engines tested in order to establish what kind of fuel they were using. The firm also noted that only Sweden, Norway and Finland currently have plans to increase the number of inspections next year, when the new low-sulphur regulations come into force.
SeaIntel’s analysis also looked into the fines that potential offenders would have to pay if they exceeded the permitted maximum sulphur levels. The analyst found that most countries involved do not have a possibility for fines in place to match the added cost of using fuel with a 0.1% sulphur content.
At the Sea Asia conference in Singapore in 2013 Per Wistoft, the chief executive officer of the Chinese oil enterprise Brightoil, told his audience that he believes that lowering the permitted maximum sulphur levels in bunker fuel will result in costs for operations in the seca zone increasing by USD 180 to 280 / t.
Not much coordination
Alan Murphy, a partner in SeaIntel and its COO, pointed to another important factor: the level that potential fines may reach in the countries circling the seca zones varies significantly. «Our analysis shows that a 4,500 teu vessel sailing at 16 knots from the beginning of the English Channel to Hamburg will save EUR 12,000 if it uses bunker fuel with a 1% sulphur content, instead of the mandated 0.1% sulphur content,» Murphy said. Thus the savings on this one-way trip are 2.5 to 6 times higher than the fine that Germany would levy on a offender – if it caught him.
Even Poland’s fines, which are the highest after those of the United Kingdom, will only just match the savings made on a trip from the English Channel to Gdansk and then back – assuming, that is, that the vessel gets caught every time.