The financial liability for accidental pollution is more than adequately covered by the Bunker Convention and national legislation such as OPA 90. No ship operator plans to pollute by dumping bunkers at sea and pollution by bunker fuel has generally been a result of accidental damage to the ship compounded by location of fuel storage tanks.
Once it was common for fuel to be stored in the double bottom spaces, but this is a vulnerability that has been addressed. Regulation of fuel systems on board ships now begins with the design stages and the size and location of fuel tanks. A regulation on oil fuel tank protection was adopted in 2004 and entered into force on 1 January 2007. The regulation applies to all ships delivered on or after 1 August 2010 with a total oil fuel capacity of 600m3 and above. It includes requirements for the protected location of the fuel tanks and performance standards for accidental oil fuel outflow. A maximum capacity limit of 2,500m3 per oil fuel tank is included in the regulation, and flag states are obliged to consider general safety aspects, including the need for maintenance and inspection of wing and double-bottom tanks or spaces, when approving the design and construction of ships in accordance with the regulation.
Taking into account that this regulation has now been in place for 15 years and that the average life of a ship is around 25 years, it can be seen that the accidental loss of fuel is now much less of a risk and is lessening with each year that passes.
Pollution is not only a result of fuel leakage into the sea but also is an inevitable result of the combustion process. All fuels containing hydrocarbons, whether they are mineral oil based or from any other source, will produce carbon dioxide (CO2). This is because the chemistry of combustion means that the carbon in the fuel will combine with oxygen in the air when combustion occurs resulting in the exhaust gas containing some levels of both CO (carbon monoxide) and CO2.
The GHG roadmap
Although cited by environmentalists as the root cause of climate change, CO2 is not generally considered as a pollutant and is an essential element in growth of all forms of vegetation around the globe. As a major user of oil fuels the shipping industry has been demonised by environmentalists although in truth the industry produces only around 2-3% of all manmade CO2 which in turn accounts for only around 6% of all sources of the gas.
Thus it can be shown that shipping’s contribution is less than 0.2% of all CO2 and since CO2 in total only accounts for 0.04% of the atmosphere it means that shipping’s contribution is below 1ppm.
As things stand the only control of CO2 from ships is that caused as a result of complying with the IMO’s Energy Efficiency Design Index (EEDI) regulations however, that may soon change.
The EEDI rules, which limit the amount of CO2 an individual new ship design is allowed to produce, are based on a complex formula aimed at measuring the work done. This involves the carrying capacity of the vessel, its intended speed and the power of the ship’s main and auxiliary engines. It is the only example of a global industry being regulated.
The rules provide for the output of ships to be reduced against a base level established in 2011. The extent of reduction depends upon the order or build date of the ship and falls in steps of 10%. The first reduction was under Phase 1 in 2015, the second under Phase 2 will occur in 2025 and the third under Phase 3 in 2025.
Under EEDI, not all ship types are subject to the exact same formula with due allowance being made for the varying power demands of different ship types. In addition, the lowest deadweight at which the rules apply is different for each ship type and there is also a sliding scale applied to ships of each type below certain deadweights, recognising the fact that some part of the power will be used for essential items (navigation, habitation and control requirements) which will consume a higher percentage of the overall power requirement in smaller ships than in larger vessels.
The EEDI rules applying to specific ship types are not actually fixed in stone but have been amended from time to time as new technologies emerge and flaws in the formulae themselves identified. Any changes are not retrospective so ships which were built to an earlier version retain the EEDI rating calculated at the time – unless they undergo conversion or major changes. This makes using the EEDI as a decision support tool for charters extremely difficult when comparing ships of different ages.
Despite the EEDI rules already limiting individual ships’ CO2 production, demands for shipping to be included in the Paris Agreement controls on CO2 production have grown and at MEPC 72 this ambition was recognised. Although there are as yet no new regulations beyond the current EEDI rules, MEPC agreed a strategy that envisages for the first time a reduction in total GHG emissions from international shipping which, it says, should peak as soon as possible and to reduce the total annual GHG emissions by at least 50% by 2050 compared to 2008, while, at the same time, pursuing efforts towards phasing them out entirely.
One of the measures is a possible new Phase 4 of EEDI which could add a further reduction as well as a possible bringing forward of Phase 3. Other options to be considered will be a speed restriction on ships and requirements to improve the efficiency of existing vessels.
Demands for speed restrictions on ships are made frequently by environmental NGOs and the matter was debated at MEPC 74 in May 2019.
The delegates at that meeting heard conflicting views on the efficacy of slow steaming as a real means of reducing CO2 emissions and no speed limit regulation was decided upon. The matter was however referred to a working group that will further examine the issue. Even if a speed limit is eventually seen as something desirable by the IMO, the rule making processes would mean it would be 2022 at the earliest before any limit was enforced.
With regard to the GHG roadmap, it is recognised that in order to achieve the declared ambitions, step changes in technology will be required and presumably means to meet the ambitions will need to be available before further regulation is made.
It should also be noted that the IMO refers frequently to greenhouse gases and does not limit the term to CO2 alone. That would mean that fuels such as LNG and LPG, both of which produce quantities of CO2, cannot feature in a zero-carbon future. If taken to the extreme, it would also make hydrogen suspect, since the scientists behind the Intergovernmental Panel on Climate Change (IPCC) recognise the forcing effect of water vapour on global warming. It is of course possible for water vapour to be condensed back to liquid form and possibly even used on board as fresh water but it is a factor that will need to be considered.
2020 SOx issues
Just as CO2 is formed by the combustion process, so burning fuel containing nitrogen and sulphur in air will produce NOx and SOx. Under MARPOL Annex VI the NOx and SOx levels in engine exhaust emissions are strictly controlled with limits reducing over time according to a rolling programme. It is generally accepted that NOx levels can be controlled to some degree by use of in-engine technologies and that LNG produces lower NOx levels than fuel oils. Additional equipment such as selective catalytic reducers can cut the level of NOx from oil fuels even further.
SOx level, on the other hand, is purely a function of the sulphur content of the fuel being used. In May 2005 when MARPOL Annex VI came into effect, the global limit on allowable sulphur content in fuel was set at 4.5% reducing to 3.5% from 2012. Lower levels apply in
emission control areas with the lowest level of 0.1% having been in force from the beginning of 2015. A new global level of 0.5% is set to come into effect in 2020 following a decision taken at the MEPC in 2016.
At the time when the sulphur level rules were being formulated, scrubbing technology was at an embryonic stage and, many believed, unlikely to be an economic alternative to low-sulphur fuels. This has since been proven to be a false assumption and scrubber technology is now an accepted means of meeting SOx emission rules. Even though the recent drop in fuel prices has extended the payback period for scrubber installations they are still seen as attractive propositions for many operators.
The IMO has accepted that because ships trade internationally there may be occasions when fuel with the required sulphur content for trading in ECAs or even globally may not be available. MARPOL Annex VI regulation 18.2 provides for such a situation and allows whatever fuel available to be used so long as the ship owner has made efforts to attempt to obtain the required fuel oil.
Determining 2020 as the date for the global cap on sulphur was not without controversy but although it has been accepted by the shipping industry, there are many who believe that the rules will be widely flouted. Shipowners that plan to fully comply with the rules regardless of cost believe that their efforts will be undermined by ‘cheats’ who continue to use fuels outside of the new rules and called for measures to prevent this from happening.
At MEPC 72 in April 2018, the IMO approved draft amendments to regulation 14 of MARPOL Annex VI and the form of the Supplement to the IAPP Certificate concerning prohibition on the carriage of noncompliant fuel oil for combustion purposes for propulsion or operation on board a ship, with a view to adoption at MEPC 73.
The change was duly adopted and effectively bans any ship not fitted with a scrubber from having any fuel with a sulphur content above 0.5% on board except as cargo. The exemption for all vessels in case of non-availability of fuel is still be available.
As a consequence of the initial belief that no SOx reduction technology would be available and therefore no emission measurement necessary, the control system decided upon to prove compliance revolved around the declared sulphur content being shown on bunker delivery notes. The notes are backed up by samples to be used only for official investigations into alleged breaches of the SOx regulations. The IMO has published guidelines for the sampling procedure which would be familiar to most ships where there is a practice of fuel sampling laid down for quality purposes.
The format of bunkering delivery notes is laid down in Annex VI and most official bodies will want to see the documents in the accepted format. Bunker suppliers in states that are party to Annex VI are required to provide the documents in the accepted format but in states that are not, there is no such requirement.
It is usual for shipowners, when ordering bunkers, to at least insert clauses to the effect that the fuel oil supply process is to be in accordance with the requirements of Annex VI and with specified maximum sulphur content appropriate to the particular intended future area of operation.
MARPOL Annex VI Regulation 18.5 requires the following items, as a minimum, to be detailed on a Bunker Delivery Note:
- Name and IMO Number of receiving ship
- Date of commencement of delivery
- Name, address and telephone number of marine fuel oil supplier
- Product name
- Quantity in metric tonnes
- Density at 15˚C (kg/m3)
- Sulphur content (% m/m)
- A declaration signed and certified by the fuel oil supplier’s representative that the fuel oil supplied is in conformity with the applicable paragraph of regulation 14.1 or 14.4 and regulation 18.3 of Annex VI.
Readying the rules for 2020
As the deadline for implementation of the 2020 sulphur limits draws closer there is increasing argument over the implications in many areas. There are effectively three ways to meet the rules: use scrubbing technology, use compliant oil fuels or use an alternative to oil fuels such as LNG.
From mid-2018 through to the present, uptake of scrubbers has increased dramatically. This, coupled with rising bunker prices, means that many ships fitted with scrubbers will have a competitive advantage over ships without.
Owners and operators that look to lose out to scrubber-fitted ships have attacked scrubbers as merely moving pollution from stack to sea. This has been challenged by scrubber proponents and some national delegations such as Japan which at PPR 6 in February 2019 made the case for scrubbers arguing that as well as the wash water being safe and relatively harmless, scrubbers also improved air quality by removing much of the particulate matter. The debate over scrubber washwater is ongoing and at MEPC 74 in May 2019, the issue was referred to a working group to consider and report back through future PPR meetings.
MEPC 74 also discussed many of the other issues relating to 2020 changes including the suitability and safety issues of compatibility of different compliant fuel types and their long-term stability. The meeting also tackled other issues such as non-compliance and availability of compliant fuel.
Under Resolution MEPC.320(74) entitled 2019 GUIDELINES FOR CONSISTENT IMPLEMENTATION OF THE 0.50% SULPHUR LIMIT UNDER MARPOL ANNEX VI, the IMO has set out some non-mandatory proposals for ensuring consistent implementation and provided further details of action to be taken in case of non-availability of compliant fuel.
This will entail the completion of a ‘fuel oil non-availability report’ (FONAR) explaining the circumstances and intended action that has to be advised to the flag state.
Resolution MEPC 320(74) is available here. It is a 19-page document which should be read by all concerned with ship operation and bunkering.
Completion of a FONAR does not guarantee immunity to a ship using non-compliant fuel but is merely an explanation of why it was necessary to do so. It remains a non-compliance situation for a ship to arrive at its next port with fuel oil of more than 0.50% sulphur content.
A circular agreed at MEPC to be issued outlines a number of possible scenarios which the port state, flag state and ship can agree to apply in such circumstances. This ranges from requiring de-bunkering at the port to keeping the non-compliant fuel onboard until next port in a controlled manner. The guidelines do not pre-judge what control actions a port state may take in such circumstances, and it cannot be ruled out that some port states may still penalise ships for arriving with non-compliant fuel onboard in any case. This is similar to the guidance issued by the IMO for non-compliance with the 2004 ballast convention.
The IMO has made determined efforts not to phase in the 2020 requirements but how far ships can be expected to meet them due to practical reasons remains to be seen.