Industry Responds to Regulations
The next few years will see some significant changes in emission regulations for shipowners. These include the rules concerning sulphur oxides (SOx) in the form of the 2020 global sulphur cap and nitrogen oxides (NOx) with the establishment of Nitrogen Emission Control Areas (NECAs) in 2021.
Covering the same geographical area as the current North and Baltic Seas Sulphur Emission Control Areas (SECA), the NECAs are applicable to newbuild vessels only and, depending on engine size, will lead to reductions in NOx emissions of around 70 per cent. Considering the major engine manufacturers, recent activity has shown that they are gearing up for the 2021 European NECAs.
Volvo Penta, for example, recently introduced its new Tier 3 engine. Initially intended for 13-litre models from 2018, the engine uses Selective Catalytic Reduction (SCR) technology for the after-treatment of exhaust gases. Volvo Penta has made additional advances in the field of sustainability with its engines by also allowing operators to select biofuels as a primary fuel choice. By using hydrotreated vegetable oil (HVO), carbon dioxide and particulate matter emissions can be reduced by up to 90 per cent.
As an American concern, Caterpillar’s attention on EPA legislation has been its driving force behind new products, something that has progressed logically to the IMO.
“We have a complete range of IMO Tier 3 compliant engines, with a main focus on 600 kW and above, but also the smaller engines and generator sets from 130 kW going up to the larger high-speed engines – all certified from the factory,” Peter Snijders, Business Developer at Pon Power, the Caterpillar dealership for the Netherlands, Norway, Sweden and Denmark, said.
The company’s recently introduced 3500E series illustrates the significance of client input when putting a new product together.
“It is very important for us to listen to the voice of business in the product development process. Our customers point out things that are important to them and we use this input for development. A good example of this is fuel optimisation, which leads to lower operation costs.”
Indeed, the new series provides operators with five to seven per cent fuel savings.
“Other feedback comes from analysis of engine use – sailing profiles, average loads and idling behaviour, for example. We track that and share the data with Caterpillar.”
Realistic business case
Other features of Caterpillar’s new engine range are unchanged back pressure – even with its integrated SCR – and its ability to function in a very wide range of operating windows due to skip firing modifications.
“We have also reduced PM [particulate material] emissions by 80 per cent by controlling the combustion temperature. This is particularly significant for improving air quality in urban areas or for yacht owners.”
In the context of the ‘big picture’ of increasing sustainability in the maritime sector, Snijders concludes that Caterpillar’s Tier 3 engines prove that there is a business case for cleaner technology.
“It doesn’t have to mean that you have to add costs. Yes, the initial investment is increased, but the operating costs are reduced. In fact, the best feedback that we have got so far is that we are receiving orders, because that is ultimately our goal – to help customers reduce their operating costs and maximise their uptime.”
Progress on LNG
Moving to the subject of the 2020 global sulphur cap, using LNG as primary fuel is one choice facing ship-owners looking to comply with future legislation. While the transport of LNG is not new – large 100,000 cubic metres carriers have in fact been carrying LNG for decades – the small scale LNG market of up to 15,000 cubic metres has been quite slow to get off the ground (in what has commonly been defined as a ‘chicken-and-egg’ situation regarding supply and demand).
Recent events have shown that progress is being made and that this market is beginning to fully emerge.
Bastiaan Schurink, Design & Proposal cargo vessels at Damen Shipyards, explains: “The fact that financial subsidies have been made available from the EU is a major breakthrough in terms of stimulating LNG bunkering infrastructure. The improved availability of LNG should lead to more ship owners deciding to make the switch to LNG.”
Raising the subject of EU-subsidies brings comparisons to the offshore wind sector.
“Offshore wind has been on the receiving end of subsidies from the EU as well as from national governments. And now you are seeing that the first offshore wind farms are repaying on that initial investment. We expect to see similar progress with LNG – starting with the relatively small quantities that we are seeing now, and increasing in the mid to long term. And as the bunker volumes increase, LNG will also become more interesting in terms of price in comparison to MGO.”
More than maritime
This growing market will require vessels of various sizes capable of carrying LNG.
“It’s important to understand the different vessel sizes,” Schurink continues.
“There is a big difference between the large 100,000 cubic metres carriers, intended for intercontinental LNG transport, and the smaller vessels which have been developed in recent years.” - Damen Liquefied Gas Carrier; Image Courtesy: Damen
He is referring to Damen’s range of liquefied gas carriers with capacities ranging from 800 to 7,500 cubic metres.
“These vessels are able to transport LNG from large scale LNG terminals to remote located small scale LNG terminals; feeder services from Rotterdam to the Baltic, for example. And, as well as transport execution, we are also able to deliver a liquefied gas carrier which can perform LNG ship-to-ship bunkering operations.”
Still, in the realms of LNG transport, but not in terms of fuel, it should also be noted that the subject of LNG goes further than the maritime sector.
“Small islands – in the Caribbean or the Mediterranean, for example – are also looking to LNG for electricity generation requirements. Many islands that are dependent on diesel generators for their electricity supply are considering a switch to LNG, which would increase independence from fluctuating oil prices and also be cleaner, environmentally speaking. Our expectations for this market are positive – combining our liquefied gas carrier and floating storage unit (FSU) designs. In this configuration, the liquefied gas carrier can transfer LNG to the FSU; which is effectively an economic LNG storage solution. In turn, the FSU can transfer LNG, via piping, to shore or the FSU can be used as LNG conditioning unit to transfer LNG to natural gas.”
Retrofitting their vessels with a scrubber is another alternative that shipowners have when looking for compliance with the 2020 global sulphur cap. Products come from an array of companies – such as Alfa Laval and AEC Maritime – as the competition is set to increase as the 2020 deadline approaches.
The advantage of a scrubber is that a vessel can still be operated with HFO. This has the potential to lead to financial savings because of the fact that low sulphur fuel oil is more expensive than high sulphur fuel oil; hence a ship-owner will see a return on the initial investment of a scrubber installation.
Since that, apart from price, one of the biggest issues on the minds of shipowners considering a scrubber retrofit is downtime, the announcement last year from scrubber producer AEC Maritime and Damen to cooperate to provide a more integrated service for scrubber retrofit projects was a key move. AEC Maritime has drawn on more than 20 years’ experience from sister company AEC Systems, which has installed more than 2,600 land-based scrubber systems, to develop a scrubber for the maritime sector. And Damen Green Solutions has teamed up with Damen Shiprepair and Conversion to offer streamlined engineering, project management and installation services.
The trio of companies recently took this way of thinking a step further with their so-called ‘Modular Approach’ to scrubber retrofits. This process utilises the time before a vessel arrives at a repair yard to prepare for the actual scrubber installation – thus reducing the time spent in dock from weeks to days.
The first installation of this type was carried out for the RoRo cargo vessel Stena Scotia. The scrubber and supporting systems are prefabricated, while on board preparation work involving steel works and piping takes place during routine stopovers.
“With the need to access the vessel during its regular operations to undertake the preparations, it is vital to work very closely with the owner and crew to make the hours available as productive as possible,” Stef Loffeld, Damen Project Manager, said.
“Fortunately, DSC’s Harbour & Voyage teams are expert at working efficiently and unobtrusively when a ship is still in an operational mode. The result is a fast and effective installation with minimum downtime.”
Yet another choice available to shipowners is to decide to run their vessels on low sulphur fuel oil.
Currently, this subject raises all sorts of challenges – ones that will not necessarily have to be addressed by the global maritime industry, but rather by the global oil industry.
As the balance of supply and demand of low sulphur fuel shifts, there will be the hurdles of increased production by refineries, sourcing and bunkering to overcome. - Tom Scott