Will the Implementation of the 2020 Sulfur Cap be Delayed?
Two of the most discussed issues in the international maritime industry in recent years have been the implementation of Ballast Water Management Convention and the approaching 2020 Sulfur Cap.
The prolonged maritime downturn of the last decade combined with the substantial capital expenses required to meet the requirements of both conventions have raised serious concerns among maritime stakeholders and have led to heated debates at IMO meetings, with many calling for the postponement of their implementation.
The first convention to allow postponement was the Ballast Water Management Convention. The two-year postponement of the installation of ballast water treatment systems was agreed at the 71st Marine Environment Protection Committee (MEPC 71) which took place in London in July 2017. As a result of the many obstacles to the effective implementation of the Convention, such as the lack of facilities to install treatment systems onboard, the application of New G8 guideline and U.S. Coast Guard Type Approval, the decision was made to postpone its implementation.
However, this decision means that the early movers, those shipping companies which had already installed treatment systems on board their ships in accordance with the convention, are having to face many more hurdles such as non-compliance with the requirements of USCG type-approval, whereas those who decided to wait and see can now benefit from installing a more reliable system with a proven track record.
Now the eyes of the maritime industry are turning to the global Sulfur Cap which will come into effect in 2020. But, there is a significant doubt across the industry that the convention will actually come into effect in 2020, as currently scheduled.
With less than two years left before it enters into force, it is evident that the relevant parties are far from fully prepared. For example, the IMO regulations, which are relevant to the convention, in terms of how to apply and implement the convention, have still not been finalized.
The majority of shipping companies have still not made up their minds on what measures they will be taking, to comply with the convention. The refineries, on the other hand, are not expected to be able to produce a sufficient amount of low sulfur fuel oil for ships, in time. These factors are similar to those faced by the industry when it came to complying with the Ballast Water Management Convention, and so many in the industry have voiced a need to postpone the implementation of the Sulfur Cap.
However, I think there is very little chance that it will be postponed, for the following reasons:
It is anticipated that there will be a regional shortage of low sulfur fuel oil after 2020. However, if low sulfur fuel oil is not available at the place of bunkering, under MARPOL Annex IV/18.2, the ship is simply allowed to be exempt from compliance with the Sulfur Cap regulation. Therefore, a shortage of low sulfur fuel oil will not be a legitimate excuse for postponement.
Some ships will be fitted with exhaust gas cleaning systems to comply with the Sulfur Cap. The availability of these may not fully meet the demand before the year 2020. In such cases, a ship will be allowed to use low sulfur fuel oil until it is equipped.
In the last two IMO meetings, the 4th Pollution Prevention Response (PPR) held in February 2017 and MEPC 71, several member states highlighted their concerns regarding the difficulty of implementing the global Sulfur Cap, but they were excluded from discussions. It's likely to be difficult for IMO member states to re-submit the same proposal in future committee meetings.
Furthermore, to amend the conventions, the proposal must not attract objections from more than one-third of the contracting Governments. At the moment the number of member States that have ratified MARPOL Annex IV is 89, and the number of states objecting the postponement of implementation is likely to be more than 30. With the E.U. member states objecting, the likelihood of postponing the implementation of the Sulfur Cap 2020 convention seems very low.
Above all, if the implementation of the Sulfur Cap is postponed once again after the Ballast Water Management Convention, IMO will lose public confidence and face a significant obstacle to the smooth implementation of any future conventions. In reality, the chances of postponing the Sulfur Cap, are very, very small.
Kim Yeon-tae is Executive Director of Korean Register.
The opinions expressed herein are the author's and not necessarily those of The Maritime Executive.