New standards demanding a reduction in the sulphur content of bunker fuel in the Baltic and North Seas may have a perverse impact on the environment, increasing rather than decreasing regional air pollution, the International Chamber of Shipping (ICS) warns.

The ICS warning comes in a paper to the upcoming IMO Marine Environment Protection Committee (MEPC) meeting beginning in late September. The submission quotes a study by environmental and engineering consultancy ENTEC into the regional impacts on transport from the emission standards.

Revised MARPOL Annex VI regulations as applied to the North Sea and Baltic Sea Emission Control Areas (ECAs) require the sulphur content of ship fuel not to exceed 1 per cent as of July this year and fall to less than 0.1 per cent from 2015.

The ENTEC study concludes that the increased freight rates stemming from the higher costs of cleaner fuel may be substantial enough at the 0.1 per cent sulphur level to cause a shift from short-sea transport to road transport. The consequences of such a substitution could see a net increase in harmful emissions in the regional environment, the study concludes.

The ICS says that no formal impact assessment of the ECA sulphur standards had been performed in the lead up to their adoption, but that six studies have since been completed. According to ICS, these subsequent studies, analysed by ENTEC,  have led to concern in the national shipping associations of Belgium, Finland, Germany, Holland, Sweden and the UK over the potential harm to their short-sea shipping industries.

ENTEC found that the cost of shifting to 0.1 per cent sulphur fuel by 2015 from 1.5 per cent sulphur in heavy fuel oil pre-July 2010 is likely to be an extra €155 to €310 per tonne of fuel. The average estimate for increased fuel costs across the studies was €230 per tonne, a proportional increase in fuel bills of around 80 per cent. Total compliance costs of fuel switching are estimated to be €3 to €3.6 billion in 2015.

“The costs of alternative compliance mechanisms such as seawater scrubbers are expected to be approximately 20 to 50 per cent of the total cost of switching fuels. However, there are a number of uncertainties related to the availability and reliability of such technologies which are expected to limit any significant take up by 2015,” The ENTEC report says.

World Bunkering, Hellenic Shipping News 21/7/10