All vessels within 200 nautical miles of North America have started using low sulphur fuel since 1 August 2012. This requires 96 of Maersk Line’s vessels to carry the new fuel type.
Head of North America Marine Execution Alan McCalmont aptly describes the undertaking: “This is huge – every port and every vessel calling North America, now and in the future.”
Reducing sulphur emissions
Starting 1 August 2012, the North American Emission Control Area (ECA) requires that all vessels use a low sulfur fuel (1.0% sulfur or less); previously fuel as high as 3.5% sulfur could be used. This reduction is significant because of the known health problems and acid rain that sulphur oxides produce.
Maersk Line fully supports emissions control areas (ECA) such as this. ECAs are established by the International Maritime Organization (IMO) to reduce air emissions from vessels in environmentally sensitive areas through tighter fuel and engine requirements.
“The ECA is a legal requirement established by IMO and adopted by the United States and Canadian governments. Failure to comply can mean fines of up to $25,000 US per day per violation. A violation also means negative publicity, which would hurt our positioning as an environmental leader with the many customers who value environmental performance,” explains Lee Kindberg, director for Environment & Sustainability.
Improvement comes at a cost
While there are challenges along the way, Lee believes this is a step in the right direction. “We have committed to our customers and the governments to be the environmental leader in shipping. It also demonstrates our values of constant care and uprightness,” she says.
However, complying does not come without any costs. In fact, having low sulphur fuel is 15% more expensive than the regular bunker fuel.
“How we manage this definitely impacts our cost competitiveness, our pricing structure, and potentially our network design & management. For example, vessels must be able to carry multiple fuels, and redeployed vessels must be managed to ensure they have the fuel before they arrive in North America for the first time,” Lee stresses.
Due to a shared effort by several departments and entities, and collaboration with Maersk Oil Trading, all 27 vessels that called North America during the first week of the ECA met the requirements. Plans are also in place to ensure that all future vessel calls meet the requirements.
The challenge in complying
The required fuel is only available in a few ports around the world – even many US and Canadian ports don’t have it yet. Vessels on services that called those ports had to acquire the fuel in Asia or Northern Europe.
Some services only had one port with fuel available, so advance planning was essential.
Fuel cost and delivery efficiency also vary considerably - planning and teamwork with Marine and Maersk Oil Trading are essential to keep costs down and to minimize impact on vessel schedules and operations.
Vessel redeployments must be managed - new vessels must have the fuel before the first call in North America – either as a regularly scheduled vessel or even for a single call.
Vessels calling California must carry and manage three fuels: regular bunker, the ECA fuel, and the Marine Gas Oil required in California waters (24 nautical miles).