Panama Canal adjusting fees and operations due to low water levels

ACP said it was introducing the measures are due to an extended period of low rainfall and historic low water levels at Gatun Lake, the main source of water for the Panama Canal.

The changes will “sustain water levels and minimise impacts on customers,” the ACP said in a statement.

Despite the use of extensive water-conservation measures, this past year’s rainfall was 20% below the historic average and the fifth driest year in 70 years. It follows several years of lower than average rainfall coupled by a 10% increase in water evaporation levels due to a 0.5-1.5 Degree Celsius rise in temperature.

ACP said that without fee and operational changes, the Canal’s water levels are projected to drop to levels that would affect the neo-panamax and panamax Locks. These new measures are intended to better provide reliability in water levels and therefore transit schedules, the ACP explained.

The measures include the following components:

Freshwater Surcharge

• A new freshwater fee will be applied to all vessels over 125 feet in length overall (LOA) that transit through the Panama Canal. In addition, a variable fee ranging from a minimum of 1 percent to a maximum of 10 percent of the vessel's toll will be applied depending on Gatun Lake levels at the time of transit (i.e. if the lake has a higher level, the percentage will be lower and vice versa).

Adjustments to the Booking System

• The Panama Canal will adjust the number of daily reservation slots available to 27, replicating the total offered during lane outages. The waterway will also require that each vessel pays its booking fee in full no later than 48 hours depending on the booking period.

-- Regulars (up to 90.99 feet in beam): 6 slots

-- “Supers” (up to 107 feet in beam): 13 slots

-- Neopanamax: 8 slots (unchanged)

• One slot for supers and one slot for regular vessels will be awarded through the auction process three days before transits. Nonetheless, the Canal will continue to provide additional capacity when possible, serving vessels on a first-come, first-serve basis.

Vessel Visit Creation Fee (ETA Handling Fee)

• A handling service fee will be applied to all visits for transit at the time they are created in the system. The processing fee will be applied as follows:

-- For vessels 91 feet in beam and over: $5,000.

-- For vessels over 125 feet LOA, but less than 91 feet in beam: $1,500.

• The fee will be deducted from the vessel's tolls invoice once the vessel begins transit. If the vessel cancels the visit and does not transit, the Vessel Visit Creation Fee will not be refunded. All visits created prior to February 15, 2020 will be honoured and will not be required to pay this fee.

Together, ACP said the new measures will allow the Panama Canal to better anticipate the number and type of ships transiting the waterway, and therefore allocate water resources accordingly.

In order to plan accordingly, customers will be provided with real-time data on current and projected levels of Gatun Lake, available maximum drafts, and number and types of transits when requesting transits or making reservations. The official lake levels will be published daily, as well as forecasted for the following two months.

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Panama Canal adjusting fees and operations to deal with low water levels

Freshwater Surcharge

Adjustments to the Booking System

Vessel Visit Creation Fee (ETA Handling Fee)