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2015 Emissions regulations

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Steven

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http://www.dfdsgroup.com/Documents/pdf/Sulphur_Directive_DFDS_Feb_2014_.pdf

Quite a good document, with the clearest map I have seen to date of the emissions zone.  Also has a map showing the DFDS network

Theres a picture on the Shippax Facebook of Optima Seaways new scrubber installation - it isn't pretty. 

https://www.facebook.com/photo.php?fbid=759873434045642&set=a.183338518365806.41044.171281966238128&type=1&theater&notif_t=like
Last Edit: June 14, 2014, 09:59:23 PM by Steven
Steve in Belfast (suburbia)

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Collision-course

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I must admit my jaw dropped when I saw Optima Seaways for the first time , just one word , ugly , I am also pretty sure I read somewhere that the Visentini funnel casing has enough room to house a scrubber , aside from the look , the DFDS design cant be any good for wind resistance or stability.

Steven

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I must admit my jaw dropped when I saw Optima Seaways for the first time , just one word , ugly , I am also pretty sure I read somewhere that the Visentini funnel casing has enough room to house a scrubber , aside from the look , the DFDS design cant be any good for wind resistance or stability.
Likewise I also commented on wind resistance when I first saw it.  Looks to me like they have gone for a cheaper of the shelf solution rather than getting something made to fit inside the funnel.  However, given the size of the fleet and their stated costs of €4-7m the savings could be significant if this is a cheaper way of doing things.  Time scales could also perhaps have force their hand a bit.  I don't think much of the tumble dryer outlet pipe though!
Steve in Belfast (suburbia)

Webmaster of www.niferry.co.uk
Flickr: www.flickr.com/tarbyonline

TC

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Hmmm. That must create a fair bit of drag, and must certainly disrupt the airflow. I have to say... the person who designed this must be the one behind the Pride of Hampshire jumboisation!

Collision-course

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Victoria Seaways has had scrubbers fitted , it appears to be a bit softer on the eye ,  http://www.shipspotting.com/gallery/photo.php?lid=2038374

Steven

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Victoria Seaways has had scrubbers fitted , it appears to be a bit softer on the eye ,  http://www.shipspotting.com/gallery/photo.php?lid=2038374
Still not great looking though.  Came across the following on the FONE group, credit FW7OAKS

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RESPONSE TO THE EU SULPHUR DIRECTIVE - INTERNAL COMMUNICATIONS

P&O

As you know, a new European Union directive means that we will have to meet more stringent limits for sulphur emissions for ships operating in Emission Control Areas from 1 January 2015. P&O's North Sea and English Channel ships fall within these areas.
There are two paths that can be considered as routes to meet the new requirements. One is to use low sulphur fuel and the other is to continue to use higher sulphur fuel but to install equipment to clean pollutants from exhaust gasses - commonly called sulphur scrubbing.
Low sulphur marine gas oil is expensive and switching to it would increase our fuel bill by substantially at current prices. These extra costs cannot be absorbed by us and will have to be passed on in full to our customers.
Alternative low sulphur fuels, such as liquefied natural gas, are not viable solutions for our present fleet given the machinery, plant, and equipment we would have to retrofit to use them. Additionally, there would be a significant length of time out of service and there is as yet no sustainable supply chain in place for the supply of LNG fuel.
When it comes to sulphur scrubbing, we have invested substantial time and money in assessing the technical suitability of all our ships, including working with our chartered ship owners. Considerable technical challenges remain with scrubbing, particularly so with multi-purpose ferries that were never designed to have such installations. We have concerns about the effectiveness of such systems, and installing expensive scrubbing systems on older ships that are nearing the end of their working lives is not technically feasible or financially viable. Even this close to the implementation of the new regulations, there are outstanding questions about which types of sulphur scrubbing systems, known as Open Loop or Closed Loop, will be acceptable to the authorities.
However, we will continue to investigate sulphur scrubbing possibilities as technology progresses. We have spent time with several shipyards investigating the installation process. The cost of the equipment is greater than expected. The time out of service for installation on multi-purpose ships in particular is far greater than expected. Also, fundamental technical questions remain on some of the ships which we are still trying to resolve. As a result it is unlikely that we will have sulphur scrubbing solutions ready,  forcing us to budget for the extra cost of using low sulphur marine gas oil. Recovering the extra cost from customers will be essential.
On longer routes fares will need to rise more than on shorter ones, to cover the greater increase in fuel costs. This means an unintended consequence of this legislation to reduce emissions is the very real likelihood that more customers will opt to drive further to use shorter services, increasing emissions from road miles.
As a result of this multitude of issues, we have decided to support a major PR/lobbying exercise, led by the UK Chamber of Shipping, which will commence shortly. This will involve political campaigns and press coverage, highlighting the risk that the network of routes that customers of the ferry industry enjoy today is under threat. As we campaign to raise awareness of the difficulties the industry faces there is bound to be speculation about which services are most challenged. DFDS has recently stated that it does not believe its Harwich - Esjberg service to be sustainable in light of the new regulations, and the service will close after the summer. We will need to explain how the new legislation poses a greater challenge for longer routes and staff should understand that if we raise concerns as part of this campaign it is to fight our corner to protect jobs. If we were to reach a position where we need to contemplate any business changes consultation
would of course need to take place. Absolutely no decisions have been taken.
It is important that we are clear that we are in favour of reducing emissions. We all have a vested interest in improving the environment. But we have deep-seated concerns about unintended consequences of the new requirements across a broad range of areas. Therefore we feel that the way we are allowed to reach compliance with the new requirements needs further consideration. We are calling on the Government to fight for the sulphur directive to allow for pragmatic transitional arrangements or to support other measures that will lessen the economic impact on operators and customers.

FINNLINES
 
 
BACKGROUND
On 1 January 2015, the EU Sulphur Directive 2012/33/ EU will imply a major reduction in sulphur dioxide emission from ships, and that will heavily impact shipping in the North European emission control area (ECA) where all our vessels operate. We will be required to use bunker oil with maximum 0.1% sulphur (marine gas oil) or apply alternative methods in order to achieve the same effect. Compared to the heavy fuel oil (HFO) with 1% sulphur used by our vessels today, MGO costs about EUR 200-250 more per ton.
 
It is entirely left to each shipping company to decide how to respond to this challenge. There are basically just a few real options how to comply with the new legislation; either you switch over to MGO or you invest in scrubbers. For newbuildings many ship owners have decided to invest in LNG technology but this is too complicated and expensive for retrofits.
 
The best way to respond is of course to improve energy efficiency for existing fleet. A lot have been done so far but much more is to come. In 2012, we were able to lower the overall fleet consumption with 28,000 tons. Last year we were able to reduce the consumption even further by 14,500 tons by phasing out three vessels with high fuel consumption and changing time schedules to reduce the commercial speed for several lines. The energy efficiency program continues and the target is to further reduce the overall consumption by 50-55,000 tons to a total fleet consumption of 300,000 tons in 2015. 
 
HOW WILL FINNLINES OTHERWISE RESPOND?
 
Scrubbers
On 7th May 2014, Finnlines signed two major contracts for Scrubbers covering the whole ro-ro fleet owned by us. Wärtsilä won the contract for our newest ro-ro vessels, the Jinling series delivered 2011-2012 and Alfa Laval the contract for remaining ro-ro vessels (Finnhawk, Finnkraft, Finnpulp and Finnmill).  By selecting scrubbers, these vessels will be able to con­tinue using heavy fuel oil, while still meeting the environmental and legislative standards by clean­ing the exhaust gases. The installations are planned to start in November 2014 and will continue until beginning of 2015.
 
After thorough assessment, the technical  solution chosen is a so called Open Loop system which is, however, going to be designed as “hybrid ready”. In practice this means that we will use Sea Water to clean the exhaust gas, which is fully accepted and in compliance with the new legislation, but keep an option to extend the scope also to cover a Closed Loop system, if required in the future.
 
For the remaining ro-pax vessels, we are still assessing suitable solutions on the market. We need, however, to be prepared to start running on MGO from 1st Jan 2015 with our ro-pax vessels.
 
 
Propeller re-blading
Finnlines has also signed a significant contract covering the re-blading of our four star-class vessels. The current propeller blades will be replaced by new ones optimized for a lower commercial speed and there will also be a bulb fitting to the rudder optimizing fuel savings. The rebuilding will take place in November and December 2014, while Finnstar and Finnlady will have their scheduled dry docking and during a shorter stop for Finnmaid and Nordlink.
 
 
 
 
 
NEXT STEPS
For all our ro-ro vessels, the scrubber retrofit projects have already started. As we are now in the phase of negotiating installation works, you will see several companies onboard wanting to perform ship checks. Also the nominated design offices need to do their ship checks on each vessel to ensure the final designs for each vessel.
 
Another thing that needs to be done onboard each ro-ro vessel is to perform back pressure checks on main engines. We have agreed to let the engine manufacturer perform the first vessel check together with our own technical personnel and after this, we will do similar checks for the rest of the vessels ourselves.
 
For all ro-pax vessels, we need to assess the modification needs for switching from HFO to MGO. There will be a workshop arranged between the engine manufacturer, our project team and technical superintendents to discuss what is needed for a smooth transition of fuel used onboard.
 
Finnlines project team are continuously negotiating and evaluating various solutions for the fleet both regarding additional scrubber installations as well as further propulsion enhancements. The main target remains to find innovative and cost effective solutions to respond to the challenges and ensure that also in the future, the Motorways of the Seas remains the most environmental and cost effective transport method within the Baltic Sea
2 totally different companies, 2 totally different approaches.  However, whatever the approach its going to mean more costs.  Interesting that Finnlines are going with re-blading, similar to what Stena did up here with the Superfasts
Steve in Belfast (suburbia)

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Steven

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The following is thanks to fw7oaks on the FONE group, and translated from a Belgian site:

Quote
With the introduction of the new sulphur rules calling for the switch to more expensive fuel DFDS will have to raise the  rates on the route between Zeebrugge and Rosyth considerably. If the customers can not see that the service of the Scottish market from Zeebrugge could move to a northern English port.

Stein van Est, managing director of DFDS Seaways NV, the Belgian subsidiary of Danish shipping and logistics group, told the Shortsea-Euro-Conference in Antwerp.

Van Est was the first to admit that it is unlikely that all customers will be prepared to pay that additional cost – which will amount to about 20% - for a direct access to Scotland. A possible alternative is to move from Rosyth to a port such as Newcastle or Immingham.

DFDS are talking with their customers in the coming months to determine whether the one or the other solutions has sufficient support.

So it looks like Rosyth-Zeebrugge is in trouble again!  Hardly surprising given the length of the passage, however surely this shows the self defeating nature of the emissions regulations as if the route is closed far more pollution will be generated by extra road miles than by the ferry running in its current state.
Steve in Belfast (suburbia)

Webmaster of www.niferry.co.uk
Flickr: www.flickr.com/tarbyonline

Collision-course

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I am inclined to agree with the industry groups that the new regulations will lead to a number of route closures and will reverse the modal shift that has taken a large number of trucks off EU motorways , thereby killing the principle of the Motorways of The Seas program.
The EU does not seem to understand how long it takes to re-engineer or replace a fleet of ships , or the costs involved for that matter.
Another milestone (or millstone depending on how you look at it) is that in September this year Ryanair will take delivery of the first of its new generation Boeing 737-800 aircraft , it is planning to replace its entire fleet and expand by a further 225 operational aircraft over the next 5 years , these new generation Boeings are 35% more fuel efficient than current aircraft and Ryanair predicts that it will be cutting fares by at least 20% as these new aircraft come onstream during 2015 , given that during 2015 ferry fares will be increasing by 20% it does not take a brain surgeon or rocket scientist to see what the effect this will have on ferry traffic.

hhvferry

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Another milestone (or millstone depending on how you look at it) is that in September this year Ryanair will take delivery of the first of its new generation Boeing 737-800 aircraft , it is planning to replace its entire fleet and expand by a further 225 operational aircraft over the next 5 years , these new generation Boeings are 35% more fuel efficient than current aircraft and Ryanair predicts that it will be cutting fares by at least 20% as these new aircraft come onstream during 2015
Whilst Ryanair are getting another 180+ new aircraft, the fact that they are 737-800s is not significant, given that is the same model as all the existing fleet. Ryanair haven't gone for the 737MAX which offers greater fuel efficiency and is the replacement model for the type of aircraft they currently operate.

TC

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Haha, you have to love P&O's response.

Its sort of 'well were going to have a look at some more expensive fuel, but pass on the bill to the customer. Sort of look at what other yards can come up with, but given the cost, it isn't really viable. And! The final bit, totally lobby it!'

That's the P&O spirit for ya! I think these regs will be the nail in the coffin for Pride of Bruges & Pride of York (Norsun & Norsea)  :'(.

Pride of Rotterdam and Pride of Hull will be a bit of a challenge. A DFDS scrubber would look well on the Fincantieri twins  ::).   

Steven

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For completeness, heres Stena's take on it all (with an even clearer but very small map)

http://www.stenalinefreight.com/~/media/Files/Freight/Broschure/Sulphur%20Brochure%202014%20-%20Final%20online%20version.ashx

EDIT: Posted this in the fleet movements thread but probably more appropriate in here:

Basically, they are waiting until the technologies are more developed before throwing a load of cash at it (and perhaps having to upgrade at a later date).  Personally I think the methanol trial is an indication of how things may go in the longer term - like ethanol (bio-ethanaol) methanol can also be produced from waste products.  For example the ethanol added to all maxol E5 (sold as standard unleaded)/E85 fuel in the Republic of Ireland is/was produced from a byproduct of cheese production.  With more commercial incentive to produce bio fuels the production cost is also bound to come down, and unlike other fuels (including LNG) there isn't a finite supply.
Last Edit: June 14, 2014, 09:52:52 PM by Steven
Steve in Belfast (suburbia)

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Steven

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This is from the Dover Express
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FERRY fares are set to soar next year when new pollution rules come into force.

P&O, DFDS and MyFerryLink must all lower their sulphur emissions by forking out on expensive fuel or investing in "scrubbers".

And passengers and freight customers will have to foot the bill by paying higher prices.

In a P&O staff briefing, seen by Dockside, the firm reveals its fuel costs could increase by a whopping £30million a year.

The document, circulated last month, says: "These extra costs cannot be absorbed by us and will have to be passed on in full to our customers."

The warning comes after ferry operators were ordered by the International Maritime Organisation and European Union to be more environmentally friendly.

Sulphur emissions must be reduced to just 0.1 per cent, from a current high of around 4.5 per cent, by January 1, 2015.

P&O spokesman Brian Rees said: "This is up there with the arrival of the Channel Tunnel and the abolition of duty free – the real industry game-changers.

"The huge increase in our costs is going to be very challenging."

The UK Chamber of Shipping commissioned a report last year which warns of price rises of 20 per cent for passengers and 30 per cent for freight customers.

The report says this could result in 2,000 job losses in the UK ferry industry.

Mr Rees admitted P&O "needs to keep looking for cost efficiencies across the business".

Both P&O and DFDS are set to switch to low-sulphur fuels in January.

But the Danish operator has also invested £80m in "sulphur scrubbers", although they have not yet been installed in its Dover vessels.

DFDS cross-Channel chief Carsten Jensen said it is "inevitable" the price of crossings will go up.

MyFerryLink will comply with the rulings, according to owners Eurotunnel, if it manages to cling onto its place on the route in the face of a competition probe.

But the shuttle firm is set to profit whatever the outcome.

Eurotunnel spokesman John Keefe said: "The whole purpose of the tunnel is as a premium service offering speed, so it is priced at a premium.

"If the ferries push prices up, our prices will be pushed up."

Dover MP Charlie Elphicke said: "I'm deeply concerned the new rules give yet another unfair advantage to the Channel Tunnel – which is bad for jobs in Dover.

"This is yet another case of European law that needs to be reformed.

"I've been making strong representations to the shipping minister Stephen Hammond about the European proposals."

Contact Dockside reporter Phil Hayes on 01303 851660 or email [email protected]



Read more: http://www.dover-express.co.uk/Pollution-crackdown-mean-higher-ferry-fares/story-21225666-detail/story.html#ixzz34eLFe0Mc
Read more at http://www.dover-express.co.uk/Pollution-crackdown-mean-higher-ferry-fares/story-21225666-detail/story.html#sKVt7eEj8HzmC6Bo.99

Interesting that Eurotunnel are saying they will also raise channel tunnel fares - some would call that profiteering!

Also, you may have noticed I changed the topic title - felt that now the posts have broadened out from the DFDS response to everyone elses that this was a more appropriate title.
Steve in Belfast (suburbia)

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Flickr: www.flickr.com/tarbyonline

Collision-course

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Whilst Ryanair are getting another 180+ new aircraft, the fact that they are 737-800s is not significant, given that is the same model as all the existing fleet. Ryanair haven't gone for the 737MAX which offers greater fuel efficiency and is the replacement model for the type of aircraft they currently operate.

My understanding from press releases from both Ryanair and Boeing is that the Ryanair order is the first of a new generation of the 737-800 , the new model uses a completely different engine to the current model hence the greater fuel efficiency , Ryanair's total order is for 400 aircraft over 5 years (also the large order is intended to keep the new model out of competitors hands for a while by buying up the production lines for some time) , the greater fuel efficiency is also sighted as the reason they are replacing their entire fleet.
Either way if Ryanair deliver on their promise of a 20% reduction in air fares during 2015 (and keep in mind they are promising us 10 Euro fares to the U.S. by 2018) at the same time as ferry fares are rising between 20-30% then it will be a disaster for ferry operators.
Also not mentioned is the cost impact on imports/exports , if the costs increase then demand for imported goods will fall as export markets shrink as higher end prices to consumers increase (as you can be sure it will not only be transport operators passing the cost increase on) , if those factors cause a drop in freight traffic then several more routes are at risk of closure , including some Irish ones.
I have a bad feeling that if the market is heavily impacted during 2015 then ferry operators will slash and burn many operations and significantly reduce their work forces as a form of punishment to the EU for not listening to them , at that point even if the EU do back down the damage to the industry will be severe.
There may also be an unforeseen external shock to play out yet , it appears that Iraq may unexpectedly descend into civil war , which threatens to drag Iran into the conflict also , if that happens fuel prices will go ballistic , even before sulfur regs come into play , Brent Crude increased by almost 4 dollars in one day on just the fear of an escalating situation in Iraq.
Last Edit: June 14, 2014, 11:39:22 PM by Collision-course

Steven

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I have a bad feeling that if the market is heavily impacted during 2015 then ferry operators will slash and burn many operations and significantly reduce their work forces as a form of punishment to the EU for not listening to them , at that point even if the EU do back down the damage to the industry will be severe.
There may also be an unforeseen external shock to play out yet , it appears that Iraq may unexpectedly descend into civil war , which threatens to drag Iran into the conflict also , if that happens fuel prices will go ballistic , even before sulfur regs come into play , Brent Crude increased by almost 4 dollars in one day on just the fear of an escalating situation in Iraq.

This is exactly why I think the methanol trial if successful could point to the way things will go in the future.  Unlike fuel oil and lng, methanol pricing isn't going to be directly affected by events in the middle east.  Unfortunately we are already seeing routes being axed (DFDS) and I'm sure investment will be limited now until the full effect of the 2015 regulations is assessed.  Increasing fuel prices is only going to make things worse.  However, the airlines are also going to be affected by fuel price rises and perhaps more so given the high grade of fuel they use.  Its not as easy as fitting a box to the exhaust and using a lower grade fuel in a 737.

Regarding Ryanair's order, my understanding is that it is for 175 of the existing 737-800 generation.  They have said they MAY become a lead customer for the next generation (with more efficient engines) but as yet have not placed a firm order - the press release was quite cleverly worded to give the impression they where replacing the fleet with more efficient aircraft (they have over 300 currently).  Of course they will play Airbus and Boeing off each other to get the best deal on price - Ryanair are said to pay less than half price on their 737 orders.  Of the 175 ordered, just 75 are to replace existing aircraft I believe with the balance to add capacity.

Take a look at http://www.b737.org.uk/sales.htm for more
Steve in Belfast (suburbia)

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Flickr: www.flickr.com/tarbyonline

Oscar Wilde

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Do Irish Ferries have any plans out yet about what they plan to do?