Hellenic Mediterranean PanelHellenic Mediterranean Panel

Royal Olympic Hotel, Athens

Thursday 18 March 2010

IMO’s BWM Convention

• The BWM Convention will enter into force 12 months after ratification by 30 States, representing 35% of world merchant tonnage

• As at 2 March 2010: 21 countries representing 22.63% of world merchant tonnage

Summary of implementation dates:

Ship constructed before 2009BW capacity 1500-5000m3 – treatment system from first intermediate or renewal survey after anniversary date in 2014

BW capacity < 1500m3 and > 5000m3 – treatment system from first intermediate or renewal survey after anniversary date in 2016

Ship constructed in or after 2009BW capacity < 5000m3 treatment system installed at second annual survey and no later than 31/12/2011

Ship constructed in or after 2009 but before 2012

BW capacity > 5000m3 shall have a treatment system from first intermediate or renewal survey after anniversary date in 2016 (by 01/01/2016 for 2009-built)

Ship constructed in or after 2012BW capacity > 5000m3 shall be constructed with a BW treatment system

IMO’s BWM Convention

• Treatment• Generation of chemicals• Approval• Capital cost ($USD)• Power consumption• Other costs: consumables, spares, maintenance• Operating costs 10-year • Cost (Capex + Opex)• Size (m3)• Weight (kg)• Pressure drop• # installations/contracts• Explosion-proof (intrinsically safe)?• Largest installation

IMO’s BWM ConventionMembers express concern over systems and deadline

Environmental Committee – sees need to find solutions to assist Members and seek evidence that systems will work in practice

IMO’s BWM ConventionIMO BWM Convention Guidelines

Important but overlooked

Available on our website www.intertanko.com

Guidelines for Ballast Water Sampling

Guidelines for Ballast Water Management and Development of Ballast Water Management Plans

Guidelines for Ballast Water Exchange

Guidelines for Ballast Water Exchange Design and Construction Standards

Guidelines for Sediment Control on Ships

COP 15

Hopes:Commitment to emissions reductions from developed

countriesAdaptation funding for developing countries to adapt to effects

of climate changeEqual treatment of ships regardless of flag

Outcome:Copenhagen Accord - neither accepted nor rejected by

Plenary – only ‘noted’. Non-binding - principles (of reductions and funding)

Kyoto Protocol remains in force - CBDR remains embedded in Copenhagen Accord

Onwards to Mexico 2010 - binding agreement?

Complicating factor …Complicating factor …

CBDR . . .• Common but differentiated responsibility• Applying GHG emission standards only to

flags of Kyoto Protocol Annex 1 countries will not have significant effect – only 35% of fleet

• PROBLEM: ships not linked to countries except by flag – and that can be changed leading to ‘carbon leakage’

• IMO has to end up with same treatment for all flags

• Hope CBDR will not be the cause of delay to IMO process

COP 15COP 15

Provides few answers for shipping, but raises some questions

• How will the IMO handle CBDR vs its desire to treat all flags the same?

• Copenhagen Accord refers to “new and additional funding to be provided for developing countries”

• Will shipping be asked to come up with this? Seen as deep pocket?

• If so, could this result in double ‘tax’ for shipping if MBIs introduced?

• IMO MEPC 60 next week may shed some light

IMO workplanIMO workplan

MEPC 60 (March 2010)

Chairman hopes to have 2 WGs:• Technical and operational measures• MBIs

EEDI (technical measures) is key this year’s work – fine tuning

Further details of MBI proposals to be submitted – looking at methodology and criteria for feasibility studies and impact assessments of MBIs

IMO workplanIMO workplan? 2 IntersessionalsJune - on final work op measures, and tech (EEDIs)June-Sept - on MBIs

MEPC 61 (October 2010) Hope to have tech (EEDIs) and op regulations for approval.Hope will clearly indicate which MBI it wishes to further

evaluate, and will identify elements to be included

MEPC 62 (Summer 2011) Hope will be in a position to finalise regulation and report

progress to AssemblyEU will wait only until end 2011

Technical measuresTechnical measures

societyforBenefit

costtalEnvironmenindexdesign efficiencyenergy Attained

Energy Efficiency Design Index (EEDI)- requires a minimum energy efficiency of new ships- stimulates technical development- separates technical/design based measures from operational/commercial measures- compares the energy efficiency of an individual ship

to similar ships which could have taken its cargo

Cost: Emission of CO2

Benefit: Cargo capacity over a distance

Operational measuresOperational measures

• Ship Energy Efficiency Managment Plan (SEEMP)

– improve energy efficiency of ships in operation– best practices on operational procedures - setting goals– plan implementation strategy– monitoring – Energy Efficiency Operational Indicator (EEOI)– procedures for self-evaluation/improvement towards set goals

• Energy Efficiency Operations Index (EEOI)

- assist ship operators in evaluating environmental performance of their fleet - CO2 emissions

- how to measure a ship’s energy performance - how the EEOI can be used to promote low emissions from ships

INTERTANKO positionINTERTANKO position

• Shipping should strive to significantly reduce GHG emissions

• Advocates measures that would result in CO2 and other GHG emissions reductions from tankers

• Believes that energy efficiency will be gained through better coordination with other stakeholders involved in logistical chain

• Supports IMO process to develop regulations that do not hinder commerce

• Supports “ship neutral” regulations, equally applicable to all flags

INTERTANKO positionINTERTANKO position

• Supports adoption of EEDI• Supports adoption of SEEMP (has developed

SEEMP model for tankers: TEEMP)• Stakeholders and regulators to agree on

targeting levels for GHG emission reductions• The target levels should be ambitious• Targets should also be realistic and thus provide

incentives for sustainable efforts to achieve them • It is important to initiate the process of CO2

emission reduction from shipping as soon as possible

INTERTANKO’s Guide for a Tanker Efficiency and Emission Management Plan – helps with application of SEEMP

1. Introduction

2. Establishing the Company and Ship Management Plans

3. Voyage Optimisation Programme

4. Propulsion Resistance Management Programme

5. Machinery Optimisation Programme

6. Cargo Handling Optimisation

7. Energy Conservation Awareness Plan

Operational measuresOperational measures

Virtual ArrivalVirtual ArrivalWhat is it trying to achieve?

Reduce unnecessary emissions and fuel use via mutually agreed reduction of vessel’s passage speed to meet an agreed arrival time at port, thereby reducing known inefficiencies in supply chain.

One Member calculates 40% of time in port – so savings to be made Benefits' of a timed arrival• Reduced emissions• Reduced crew fatigue• Reduced port congestion• Reduced emissions in port area • Reduced use of fuel

The safety of the vessel remains paramount The authority of the vessel’s Master remains unchanged

Virtual ArrivalVirtual Arrival

How does it achieve this?

OCIMF-INTERTANKO’s Virtual Arrival project:

• Cooperation between charterer / terminal and tanker operator

• When ship’s ETA turns out to be before terminal is ready, operator and charterer agree speed adjustment

• Operator retains demurrage, while fuel savings and any carbon credits are split between parties

• Independent 3rd party calculates/audits adjustment

Virtual ArrivalVirtual Arrival

Virtual ArrivalVirtual Arrival

Virtual Arrival in fact

• Batumi ( Black Sea) to Isle of Grain (UK) • ETA 15/0650 but tank space not available before

16th

• Vessel asked to reduce speed to arrive 16th am• Daily progress reports issued to all concerned• Final report issued by Weather Analysis Provider

to show savings

Virtual ArrivalVirtual Arrival

Virtual ArrivalVirtual ArrivalVessel sailed Batumi 2 Sept 2009. Initial ETA 15 Sept 06:50.

Vessel actually arrived Isle of Grain 16 Sept 10:00 Virtual arrival was 15 Sept 06:50 (basis of demurrage calc)

27% reduction in fuel consumption and emissions - bunker savings 58.83 ts HFO

Emissions saved • CO2 183.2 ts• Nox 4.39 ts• Sox 3.49 ts

• 1st March 2010• Covers any ship-induced pollution accident or any ship-related operation that

causes or may cause pollution damage to the internal waters, territorial seas, and the contiguous zones, exclusive economic zones and continental shelves of the PRC and all other sea areas under the jurisdiction of the PRC

• Requires ship emergency response plans• Requires insurance to cover claims for pollution for all ships, except < 1,000gt and not carrying oil cargoes• Such insurance to be provided by an entity approved by China MSA (M’time

Safety Agency)• Limit of liability is as per PRC Maritime Code (LLMC 76) (seems no limit?)• The operators of any ships carrying bulk hazardous and pollutant liquid

cargo shall contract with an MSA-approved local clean-up contractor• Receivers of persistent oil cargoes are required to contribute to the PRC

Fund, which would compensate for ship-induced pollution claims that are in excess of CLC limits

• Provision made for discharge and receipt of waste (port reception facilities)• Fines for breach of provisions estimated Yuan 10k-300k ($1.5k-45k)

CHINA - Regulations on the Prevention and Control of Ship-Induced Pollution of the Marine Environment

INTERTANKO Observations and Queries

1. Not certain whether CLC 92 for persistent oil or Bunker Convention 2001 for ships over 1,000gt would suffice in terms of insurance

2. Entities to provide insurance cover not yet decided / approved by China MSA – P&I?

3. We require a list of MSA-approved clean-up contractors (language barriers … standard terms?)

4. Assumed that SOPEP and SMPEP would suffice as the ship emergency response plans

5. Although China not party to the CLC Fund, contributions to a PRC Fund would seem to be a local variation on the CLC Fund principle

6. Not clear whether standardised advance notification forms and waste delivery receipts for port waste reception facilities will be used

CHINA - Regulations on the Prevention and Control of Ship-Induced Pollution of the Marine Environment

CHINA - Regulations on the Prevention and Control of Ship-Induced Pollution of the Marine Environment

IG P&I clubs understand delay for 3 months (or 3 months from publ of approved contractors list) – but no official proof/evidence received

We await official English translation and further guidance – it’s not that China won’t tell us the answers – it doesn’t yet appear to have them!