Rinaldi Roberto - OIl Spills in Mediterranean Sea.An evaluation of EU regulations: double-hull or...

8/8/2019 Rinaldi Roberto - OIl Spills in Mediterranean Sea.An evaluation of EU regulations: double-hull or -hullabaloo

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Universit degli Studi di Roma - Tor Vergata

Faculty of Economics

Supervisor:Prof. Castellucci Laura

Candidate:Roberto Rinaldi


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2Oil Spills in the Mediterranean Sea. An evaluation of the EU regulations: double-hull or -hullabaloo? - RINALDI ROBERTO

Source: DeLong J.B. (1998) - Estimating World GDP, One Million B.C. - Present.


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The use of energy has been a key elementin development of human society sinceIndustrial Revolution.



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Production of energy from animal sources to production of energy fromnatural sources (coal, petroleum, natural gas, ...).



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Nowadays,more than 80% of worldwide energy comes from

burning of fossil fuels. (Petroleum 40%).



7/652Oil Spills in the Mediterranean Sea. An evaluation of the EU regulations: double-hull or -hullabaloo? - RINALDI ROBERTO













Petroleum Natural gas CoalHydroelectric Nuclear Other








Petroleum Natural gas CoalHydroelectric Nuclear Other

Source: Energy Information Administration 2005 data.



Source: The International Tankers Owners Pollution Federation Limited (ITOPF) & Energy Information Administration (2005) - World Oil Transit Chokepoints.

Source:Regional Marine Pollution Emergency Response Centre for the Mediterranean Sea (REMPEC) (2005) - Main routes in the Mediterranean Sea for crude oil tankers for year 2005


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- Maritime transportation of oilmore than 60% of the total oil transported every year.




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- More than 2 billion of metric tons ( tonnes ) in2005.



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- More than 2 billion of metric tons ( tonnes ) in2005.

- Mediterranean Sea is a strategic waterway thataccounts for over 15% of global shipping activity



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- Semi enclosed sea;

- Water circulation almost not existing (surface waters turnover 80 years);

- UNEP biodiversity hotspot (endemic

species);


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species);

- Main economic activities of the basin highly correlated with sea NR:commercial shing and tourism.


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species);

- Main economic activities of the basin highly correlated with sea NR:commercial shing and tourism.

=> OIL SPILLS INTO MEDITERRANEAN SEA


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1954 1973 1975 1982 1992 200520022000


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1954

OILPOLCommitment:

prohibition dischargesin specic areas.

1973 1975 1982 1992 200520022000


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MARPOL 73/78Regulation:

discharges at sea of oil and otherharmful sustances from ship


1954

OILPOLCommitment:


1973 1975 1982 1992 200520022000


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1954

OILPOLCommitment:


1973

BARCELONA CONVENTIONProtocols:

appropriate measures toprevent and abate pollution

caused by dumping fromships in Mediterranean Sea

1975 1982 1992 200520022000


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1954

OILPOLCommitment:


1973




1975 1982 1992 200520022000

UNCLOSRights and

responsabilitiesof nations intheir use of

worlds oceans+

Guidelinesprotection of the

environment


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1954

OILPOLCommitment:


1973




1975 1982 1992

MARPOL I/13F, I/13GMandatory introduction

in Mediterranean Sea standard requirement

double-hull+

Phase-out scheduleold single-hulled eet

200520022000

UNCLOSRights and


worlds oceans+


environment


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1954

OILPOLCommitment:


1973




1975 1982 1992



double-hull+


200520022000

UNCLOSRights and


worlds oceans+


environment

ERIKA ISafety package:creation backlist to improve

seabornepetroleum

products trade


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1954

OILPOLCommitment:


1973




1975 1982 1992



double-hull+


200520022000

UNCLOSRights and


worlds oceans+


environment


seabornepetroleum

products trade

ERIKA IISafety package:Creation EMSA

+COPE Fund

+Improvements creation info

network on port state controls


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1954

OILPOLCommitment:


1973




1975 1982 1992



double-hull+


200520022000

UNCLOSRights and


worlds oceans+


environment


seabornepetroleum

products trade


+COPE Fund



ERIKA IIIMeasures:

port controls+...+

carriers liability


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1954

OILPOLCommitment:


1973




1975 1982 1992



double-hull+


200520022000

UNCLOSRights and


worlds oceans+


environment


seabornepetroleum

products trade


+COPE Fund



ERIKA IIIMeasures:

port controls+...+

carriers liability


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Source: Elaboration ITOPF database on accidental oil spills in Mediterranean Sea waters > 7 tonnes.

Number of oil spills in Mediterranean Sea watersMoving average from 1995


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0

2

4

6

8

9

11

13

15

70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 Number of oil spills in Mediterranean Sea watersMoving average from 1995


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0

2

4

6

8

9

11

13

15


The number of oil spills in the Mediterranean Sea waters for the period1970-2008 shows that:


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0

2

4

6

8

9

11

13

15




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0

2

4

6

8

9

11

13

15



1981-1994

76 accidents

vs.

1995-2008

40 accidents


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0

2

4

6

8

9

11

13

15



1981-1994

76 accidents

vs.

1995-2008

40 accidents


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0

2

4

6

8

9

11

13

15



1981-1994

76 accidents

vs.

1995-2008

40 accidents

- 40 %


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Volume of oil spills (>7 tonnes) in Mediterranean Sea watersMoving average from 1995


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0

35000

70000

105000

140000

175000

210000

245000

280000

70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08



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The volume of oil spills in the Mediterranean Sea waters for the period1970-2008 shows that:

0

35000

70000

105000

140000

175000

210000

245000

280000

70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08



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0

35000

70000

105000

140000

175000

210000

245000

280000

70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08



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1981-1994

325,200tonnes

vs.

1995-2008

125,210

tonnes0

35000

70000

105000

140000

175000

210000

245000

280000

70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08



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1981-1994

325,200tonnes

vs.

1995-2008

125,210

tonnes

- 61 %

0

35000

70000

105000

140000

175000

210000

245000

280000

70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08



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COSTS ASSESSMENTa) Cost of inaction: costs/damages between 1992 (discussion of MARPOL I/13F and I/13G)

and 1995 (entrance into force of double-hull standard requirement)

YEAROIL SPILT

due to inaction(tonnes)

CLEANUP($ million)

ETKIN D.S. (1999)

DAMAGES($ million)

A.T.I. ENI-IRI (1992)

TOTAL($ million)

1992 46,556 400.17 333.94 734.11

1993 1,476 12.69 10.59 23.27

1994 21,033 180.79 150.87 331.66

TOTAL C ST OF INACTION $1.09 billion

per-year C ST OF INACTION $0.36 billion

b) Cost of action: increased in 1) capital expenditures to replace retired tankers;2) operating expenses of double-hull tankers;3) costs associated with the timing of replacement.

per-year COST OF ACTION $0.28 billion

Accoding to the Committee on Pollution Act additional operating andconstruction costs are expected to be $3.94 billion in Mediterranean Sea


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BENEFITS ASSESSMENT

Assessment of all those avoided damages that not spilled oil would have created for 1995-2008.

A monetary value of clean-up cost, loss of commercial shing and environmental damages that

199,990 tonnes of not spilled oil would have created, based on damage assessment by A.T.I. ENI-IRIof the M/T Haven oil spill in 1991 off Genoa coasts.

YEARSOIL NOT SPILT

(tonnes)CLEANUP

($ million)DAMAGES($ million)

TOTAL($ million)

1995-2008 199,990 1,719.02 1,434.53 3,153.55

OTAL BENEFITS $3.2 billion

p r-year BENEFITS $0.23 billion

NOTE: - Benets of avoided damages do not last for only 14 years, but their effects extend with aninnite time horizon (ex. sh species);

- Per-year benets not discounted.


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RESULT YEAR COST($ ,000)

BENEFIT($ ,000)

1992 734,111.91 -

1993 23,274.35 -

1994 331,659.54 -

1995 260,883.46 225,253.49

1996 264,627.06 225,253.49

1997 274,034.95 225,253.49

1998 279,274.93 225,253.49

1999 264,373.84 225,253.49

2000 271,038.51 225,253.49

2001 259,102.75 225,253.49

2002 275,890.52 225,253.49

2003 289,120.44 225,253.49

2004 291,428.88 225,253.49

2005 306,205.72 225,253.49

2006 309,958.63 225,253.49

2007 300,959.11 225,253.49

2008 289,984.41 225,253.49

per-year ($ ,000) 295,642.88 225,253.49


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RESULT

CBA-ratio = 0.76

YEAR COST($ ,000)BENEFIT($ ,000)

1992 734,111.91 -

1993 23,274.35 -

1994 331,659.54 -

1995 260,883.46 225,253.49

1996 264,627.06 225,253.49

1997 274,034.95 225,253.49

1998 279,274.93 225,253.49

1999 264,373.84 225,253.49

2000 271,038.51 225,253.49

2001 259,102.75 225,253.49

2002 275,890.52 225,253.49

2003 289,120.44 225,253.49

2004 291,428.88 225,253.49

2005 306,205.72 225,253.49

2006 309,958.63 225,253.49

2007 300,959.11 225,253.49

2008 289,984.41 225,253.49

per-year ($ ,000) 295,642.88 225,253.49


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RESULT

CBA-ratio = 0.76

For every $1 of costs sustained for the application of theMARPOL Regulations,


1992 734,111.91 -

1993 23,274.35 -

1994 331,659.54 -

1995 260,883.46 225,253.49

1996 264,627.06 225,253.49

1997 274,034.95 225,253.49

1998 279,274.93 225,253.49

1999 264,373.84 225,253.49

2000 271,038.51 225,253.49

2001 259,102.75 225,253.49

2002 275,890.52 225,253.49

2003 289,120.44 225,253.49

2004 291,428.88 225,253.49

2005 306,205.72 225,253.49

2006 309,958.63 225,253.49

2007 300,959.11 225,253.49

2008 289,984.41 225,253.49

per-year ($ ,000) 295,642.88 225,253.49


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RESULT

CBA-ratio = 0.76

For every $1 of costs sustained for the application of theMARPOL Regulations,approximately $0.8 of benets were registered.


1992 734,111.91 -

1993 23,274.35 -

1994 331,659.54 -

1995 260,883.46 225,253.49

1996 264,627.06 225,253.49

1997 274,034.95 225,253.49

1998 279,274.93 225,253.49

1999 264,373.84 225,253.49

2000 271,038.51 225,253.49

2001 259,102.75 225,253.49

2002 275,890.52 225,253.49

2003 289,120.44 225,253.49

2004 291,428.88 225,253.49

2005 306,205.72 225,253.49

2006 309,958.63 225,253.49

2007 300,959.11 225,253.49

2008 289,984.41 225,253.49

per-year ($ ,000) 295,642.88 225,253.49


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RESULT

CBA-ratio = 0.76



1992 734,111.91 -

1993 23,274.35 -

1994 331,659.54 -

1995 260,883.46 225,253.49

1996 264,627.06 225,253.49

1997 274,034.95 225,253.49

1998 279,274.93 225,253.49

1999 264,373.84 225,253.49

2000 271,038.51 225,253.49

2001 259,102.75 225,253.49

2002 275,890.52 225,253.49

2003 289,120.44 225,253.49

2004 291,428.88 225,253.49

2005 306,205.72 225,253.49

2006 309,958.63 225,253.49

2007 300,959.11 225,253.49

2008 289,984.41 225,253.49

per-year ($ ,000) 295,642.88 225,253.49


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RESULT

CBA-ratio = 0.76



1992 734,111.91 -

1993 23,274.35 -

1994 331,659.54 -

1995 260,883.46 225,253.49

1996 264,627.06 225,253.49

1997 274,034.95 225,253.49

1998 279,274.93 225,253.49

1999 264,373.84 225,253.49

2000 271,038.51 225,253.49

2001 259,102.75 225,253.49

2002 275,890.52 225,253.49

2003 289,120.44 225,253.49

2004 291,428.88 225,253.49

2005 306,205.72 225,253.49

2006 309,958.63 225,253.49

2007 300,959.11 225,253.49

2008 289,984.41 225,253.49

per-year ($ ,000) 295,642.88 225,253.49

IS DOUBLE-HULL A HULLABALOO???


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YES


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Incentives for technological improvements in the LR of technology standards (as double-hull) equal to zero. YES


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NO



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The introduction of the MARPOL Regulations had a decreasing effect on both the number of accidents with an oil release and the volume of oil spilled in Mediterranean Sea waters.

NO



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NO


FURTHERMORE


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In the CBA, only use-value has been assessed. butTOTAL ECONOMIC VALUE (TEV) = f ( DUV , IUV, OV , BV , EV)

where:DUV= Direct Use Value

IUV= Indirect Use ValueOV = Option Value

BV = Bequest ValueEV = Existence Value

If non-use value introduced, benets would overweigh costs.


NO


FURTHERMORE


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OILPOLCommitment:







double-hull+


ERIKA IICreation EMSA

+COPE Fund



ERIKA IIIMeasures:

port controls+...+

carriers liability


1954 1973 1975 1982 1992 200520022000

UNCLOSRights and


worlds oceans+


environment

AMOCO CADIZ Oil Spill

off Brittany coasts[no-Med waters]1.6 million barrels

M/T HAVEN Oil Spill

off Genoa, Italy coasts

1 million barrels

ERIKA Oil Spill

off Brittany coasts[no-Med waters]

worst disaster (damages)


seabornepetroleum

products trade

1978 1991 1999


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OILPOLCommitment:







double-hull+


ERIKA IICreation EMSA

+COPE Fund



ERIKA IIIMeasures:

port controls+...+

carriers liability


1954 1973 1975 1982 1992 200520022000

UNCLOSRights and


worlds oceans+


environment

Each international and national regulation or amendment has been enactedonly after a major oil spill .

AMOCO CADIZ Oil Spill

off Brittany coasts[no-Med waters]1.6 million barrels

M/T HAVEN Oil Spill

off Genoa, Italy coasts

1 million barrels

ERIKA Oil Spill

off Brittany coasts[no-Med waters]

worst disaster (damages)


seabornepetroleum

products trade

1978 1991 1999


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SO


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- Being better to avoid a loss than make it up for damages caused,it is less costly to avoid damages from oil spills than to remedy to thecatastrophic consequences that any accidental oil spillage causes.

SO


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SO

- Continued compliance by Mediterranean countries against oil spillsmust be forced, focusing on illegal operational discharges (< 7 tonnes).


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SO


- European Union, representing almost half of the Mediterraneancountries, could play a leading role in the enforcement of new laws.


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SO



- Only through concrete and prompt decisions there could be aneffective improvement of the environment.


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SO



- Only through concrete and prompt decisions there could be aneffective improvement of the environment. An environment that is the source for the survival of all living being -humans included.


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Thank you for your attention!

Rinaldi Roberto - OIl Spills in Mediterranean Sea.An evaluation of EU regulations: double-hull or...

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