During the course of a week of events and interviews in and around SMM in Hamburg, plenty was said about environmental regulations and compliance, but if I was looking for a clear solution to present to readers it was to prove ultimately disappointing.
Even before we get to sulphur 2020 and GHG reductions many owners are still getting their ducks in a row for ballast water management. Manufacturers continue to roll out new models with features like higher flow rates, from which one can only draw the conclusion they had realised previous models were not welll suited to the largest vessel types. More worryingly an updated ABS survey on user experience with installed systems with early adopters showed 5% of systems described as “inoperable” and 44% reporting “problematic operations”.
As the industry now gears up for costly compliance to sulphur 2020 and then GHG the fact that early adopters of ballast water management systems are penalised with operational difficulties could set a worrying precendent and certainly help reinforce the “wait and see” approach of letting others find out what works and what doesn't.
When it comes to the 2020 sulphur cap the reality is the vast majority will, at least initially, meet the regulation by using compliant fuels (that is if we exclude those who simply plan not to comply – a number I've heard being put as high as 15%).
The problem with compliant fuels is that no-one really knows how much they will actually cost, whether there will really be enough of them, or just how great the operational issues will be with blended, hybrid fuels produced on a global scale. It's not highly comforting to know that 16 months out from the deadline Esben Poulsson, chairman of the International Chamber of Shipping, cannot get an indepth answer from oil companies and refiners on availability come 2020.
For somewhere in the region of 1,200 to 1,300 ships owners have opted to fit scrubbers, and its a number that continues to grow daily. But its a relatively niche option still that suits big ships best given the investment involved and the potential, but unknown savings on the fuel price spread. And even some owners of big ships are far from convinced, just ask Euronav chief Paddy Rodgers, clearly not a fan, nor of the form of the low sulphur legislation itself for that matter.
Then there is LNG, LPG, methanol and penguin power (although I may have made the last one up).
Before discussing the LNG option in more detail this is the point where the IMO's target of reducing GHG emissions by 50%, and interim 2030 target, complicate matters when investing substantial sums of money in new low sulphur propulsion methods.
On the face of it LNG as a marine fuel is a fantastic idea – its clean, its plentiful and relatively low cost – there is just one problem it isn't going to reduce your GHG emissions by 50%, probably 20 – 25% at best. Now that's worrying if you're investing substantial sums today, or the next few years, in an LNG-powered newbuilding and looking a 25-year lifespan.
Peter Keller chairman of SEA\LNG certainly has point that it does at least get you half way to that 50% GHG reduction and then you can look adding on other technologies, some of which may not currently exist to reach the remainder. This is as good as anything else on offer at the moment and the general consensus is the technology simply does not exist, at least in large scale form usable to shipping, to reach the 50% target at the moment. That is excluding a wholesale return to windpower, but I've yet to hear anyone actually suggest the ultra-large clipper sailing ship.
This leads the likes Frank Starke, ceo of Caterpillar Motoren, to talk about a need for revolutionary change and how the industry will need to invent and adopt “power to x” solutions where renewable energy is converted to low carbon alternatives. This takes us into the realms of concepts such as converting excess electricity from hydropower plants into hydrogen to then store in fuel cells.
It's heady and exciting stuff, that will hopefully give us a much more carbon neutral future, but for the shipowner looking to make an investment/operational decision today there are many uncertainties to contend with.