Survey: Most German Shipping Companies will use LSFO

VDR headquarters in Hamburg
VDR headquarters in Hamburg

Published Nov 30, 2019 6:29 PM by The Maritime Executive

The vast majority of ships in the German fleet will run on low sulfur fuel oil (LSFO) from January 1, according to a survey undertaken by the German Shipowners’ Association (Verband Deutscher Reeder, VDR). 
81 percent of the companies surveyed will be using LSFO with a sulfur content of 0.5 percent in the future. 11 per cent will continue to use heavy fuel oil (HFO) and scrubbers. Six percent of respondents indicated that they will be using other fuels, such as those prescribed for Emission Control Areas in the North Sea and the Baltic Sea – fuels with a sulfur content of 0.1 percent. 

Two percent of the ships in the German fleet will run on LNG after 2020, according to the survey.

The greatest challenge, according to the companies surveyed, will be technical problems encountered during operations in the future, as well as the cost of the new fuel and the issue of cost compensation by third parties, in particular customers. German shipping companies are also concerned about the question of availability. 

“There are many who fear that the new fuels could cause technical problems during operation – problems that could also have financial consequences,” said Ralf Nagel, CEO of VDR. “We therefore call on all stakeholders to be as committed and flexible as possible in preparing for the changeover, to ensure that it will become a success story.”

According to the survey, the one-off investment expenditure for companies in the lead-up to the changeover averaged €7.5 million ($8.3 million) per shipping company. Nagel: “Considering that more than two thirds of the shipping companies in Germany are medium-sized and operate fewer than 10 ships, we realize just how great the financial effort was that the individual companies had to make in preparing for the changeover.” 

The VDR has called for effective controls by the respective port states. Nagel says: “We will be relying on worldwide controls to monitor the implementation of the new regulation, so that no one can gain a prohibited competitive advantage At the same time, however, we are confident that the flag states and also the customers of the shipping companies have a great interest in ensuring that the new rules are actually complied with.” 

VDR notes that while the body of data obtained through the survey is not representative of the German shipping industry as a whole, it does reflect views that can be extrapolated as the respondents include shipping companies from every sector of the German shipping industry.