Full Steam Ahead!

The IMO MEPC 73 meeting last October ended all speculation about a potential delay in the implementation of the 0.5 percent 2020 global sulfur cap. It's full steam ahead, regardless of the issues that continue to cause debate in the industry.

“Put simply, scrubbers look like a good investment,” DNB Markets stated last year. Assuming a $250/ton fuel price spread between heavy fuel oil (HFO) and a compliant alternative, DNB estimates a scrubber investment payback period of nine months for a VLCC, 14 months for a Capesize, 17 months for an MR tanker and 18 months for a Supramax.

Scrubbers have been a popular choice in the Greek shipping market, according to consultant Franman, with firm orders for 20, 30, even 90 units at a time. Open-loop systems are a popular choice, but hybrid-ready systems are also being considered. Why? Because Singapore and China are now leading what could be a worldwide movement to ban open-loop scrubber washwater discharge out of concern for its potential environmental impact.

Washwater Concerns

Industry consultant Jad Mouawad says it's not the sulfate present that is concerning. Studies have shown this would be insignificant compared with the quantity already in the oceans. Rather, he says, discharge of metals and nitrates, which the IMO has not set limits on, and polycyclic aromatic hydrocarbons (PAHs), requires further investigation.

The process of scrubber system type approvals is fundamentally flawed, he adds: “To date, no one has come up with a reasonable explanation as to why the IMO should not be responsible for assessing the environmental acceptability of scrubbers. I believe we must have a risk assessment approach where all chemicals are considered under one environmental acceptability scheme, where the IMO's Joint Group of Experts on the Scientific Aspects of Marine Environmental Protection (GESAMP) looks at the acceptability of the equipment, not national authorities.”

The sulfur cap is seen as a way of reducing the estimated 60,000 deaths worldwide directly attributable to air pollution from shipping. Nick Confuorto, President & COO of equipment manufacturer CR Ocean Engineering, believes the washwater concerns of some ports are unfounded and counter-productive. They should be much more concerned that, according to several studies, low-sulfur fuels have a higher percent of very fine particulate matter (PM) than HFO and this can cause lung disease and other serious ailments.

Confuorto cites Dr. Ralf Zimmermann of the University of Rostock in Germany: “The simplest and safest way to mitigate these adverse health effects from ship engine emissions would be to introduce efficient particle-reducing measures such as exhaust gas scrubbers and particle filters. These would precipitate the harmful fine particles from the emissions and thus reduce the adverse health effects irrespective of the fuel used.”

Devon Smith, Business Development Support Manager for equipment manufacturer Pacific Green Marine Technologies, also believes concerns about washwater are unfounded. However, faced with a growing potential for ports to ban open-loop scrubbers, he’s seeing a strong market for those that are hybrid-ready – a good option, he says, for keeping capex low in the face of regulatory uncertainty. In December alone, the company received orders for 52 systems from Scorpio Tankers and 28 from Scorpio Bulkers.

Frode Helland-Evebø, Chief Sales & Marketing Officer for equipment manufacturer Clean Marine, sees the company's technology as well suited to washwater concerns as it’s based on hybrid principles. A fully hybrid system would not add much to the capex for an open-loop system, he adds. Installation costs would perhaps be 30 percent higher and operating costs just five percent.

The system is also compliant with U.S. Vessel General Permit limits on pH. These limits differ from the IMO because they have to be met at the vessel's sea chest, not four meters away as stipulated by the IMO. This means more treatment, and the Green Marine system already uses caustic soda to meet the requirements.

Compliance Challenges

Equipment manufacturer Alfa Laval aims to simplify compliance by offering data storage and reporting functionality via its Remote Emission Monitor. Through the company's connectivity program, operators receive user-friendly, graph-based reports rather than having to analyze raw scrubber compliance data themselves. The system can log the data and also scrubber diagnostic and performance data that can then be sent to the cloud for processing by Alfa Laval analysts. This provides a foundation for condition-based maintenance services and new levels of scrubber optimization.

Currently, there is little standardization on a global basis regarding the composition and quality of low-sulfur fuels, and this presents another reporting opportunity. Dr. David Atkinson, Principal Chemist at Parker Kittiwake, says it’s important to provide shipowners and Port State Control inspectors with easy access to the data they need to accurately check and prove the sulfur content of fuels on board. The portable Parker Kittiwake XRF Analyser can do this in less than three minutes, and test results can be stored electronically.

The lack of fuel standardization may lead to compatibility and stability issues as well. Increased problems with cat fine contamination, fuel viscosity, flash point and pour point may arise. So alongside the enforcement challenges, operators are faced with fuel compatibility and stability issues, and the portable device can also be used to measure a range of wear metals in lubricating oil, allowing operators to quickly identify potential damage in cylinder liners, bearings, piston rings, gears, stern lubes and hydraulic systems.

In March 2018, over 100 ships were affected by contaminated marine fuels that were bunkered in Houston, Panama and Singapore, with further reports of a spread to China. Vessels suffered mechanical issues ranging from clogged pipes and filters to engine breakdown and power loss, leading to insurance claims worth millions of dollars. “Without proper checks in place, the sharp rise in bunker-quality issues seen in recent months could be an indicator of what may lie ahead when the global sulfur cap comes into effect,” says Atkinson. 

The main and auxiliary engines of today’s ships may originally have been designed to run on fuels that  differ from the fuels that are compliant with the sulfur cap. Fuel supply system provider Auramarine notes that many ships may switch to low-sulfur fuel in port. However, as a result of blending different fuels in the production and delivery chain, such fuels may not be tested or evaluated properly.

Although ISO 8217 is in place, there are practical concerns about how to assess fuel compatibility or get accurate data describing fuel properties. Even if delivered as a stable product, blended fuels can become unstable if they mix with other fuels.

Ships' current fuel system design, engine room arrangement and operational conditions such as trade routes also need to be considered, according to Auramarine, and especially the following equipment:

• Cooling units - to keep fuel viscosity
• Chilling units - if the cooling unit is not enough
• Filters - to cope with cat fines
• Fuel pumps - to secure pumping capacity and lubricity in relation to fuel viscosity
• Flowmeters - to support reporting and operations, and
• Fuel changeover systems - for operational safety, redundancy and compliance.

The IMO is acting to resolve industry concerns and is expected to approved guidelines targeting the sulfur cap at MEPC 74 in May. Meanwhile, with no regulatory delay in sight, the scrubber retrofit market is thriving, and the newbuild market is growing.

NOx Requirements

Along with the sulfur cap, increasingly stringent NOx regulations are in effect. Ships are currently required to meet Tier III NOx standards when operating in the North American and the U.S. Caribbean Sea Emission Control Areas (ECAs), and the requirement will take effect for the Baltic and North Sea ECAs in 2021.

Fines and penalties for non-compliance in existing NOx ECAs vary significantly. For example, the highest fine in Denmark is currently $60,000 whereas in Belgium fines could be as high as $7 million. A recently reported breach by a cruise vessel in France resulted in the captain being fined €100,000.

Exhaust gas recirculation and selective catalytic reduction systems are two ways to meet the IMO Tier III NOx criteria. Exhaust gas recirculation systems and scrubbers can be combined, and studies show there are financial benefits. The combination also produces a higher rate of PM removal than scrubbers alone.

However, all these technologies increase the CO₂ footprint of a ship, prompting some in the industry to wonder if the option of cleaning exhaust gas is really environmentally friendly in the long run.

50 by 50

Dr. Kirsi Tikka, Executive Vice President & Senior Maritime Advisor for ABS, says the IMO's greenhouse gas reduction target of 50 percent by 2050 is unlikely to be a major factor in shipowners' decisions on 2020 sulfur cap compliance.

“Compliance with the 2050 targets is extremely challenging and will require new technology and energy sources,” she says. “Every stakeholder, whether a shipowner, charterer or investor, must consider the lifecycle risk to the asset values when making investment decisions in a low-carbon and ultimately no-carbon future. The risks include regulatory variability, meeting charterer and end-user sustainability requirements and cost competitiveness. Understanding the impact and efficacy of the technology options as well as their degrees of maturity will be critical in future decision-making.”

Until then, it's full steam ahead on the challenges of 2020 technology. – MarEx

Wendy Laursen is the magazine’s Asia/Pacific Editor.