Memorandum submitted by Lloyds Registers' (EFS06)

 

1. Summary

 

· CO2 considered the most significant greenhouse gas (GHG) emission from ships.

· CO2 emissions from shipping in 2007 = 1,120 million tones, equivalent to approx 4% global anthropogenic CO2 emissions.

· CO2 emissions estimated to increase to 1,475 million tones by 2020.

· Unrepresentative to calculate UK share of international shipping emissions using traditional apportionment measures eg. on the basis of fuel sold in UK to shipping trading internationally or on the basis of fuel consumed by UK flagged ships.

· Allocating UK international shipping emissions on basis of UK percentage of world GDP would be simple and could reflect loosely the benefit the UK derives from international shipping.

· The International Maritime Organization (IMO) has been attempting to develop and introduce measures to control greenhouse gas (primarily CO2) emissions from ships for the past decade. Major problems have been encountered in the form of objections from Kyoto Protocol 'non-Annex I' countries, who advocate any measures agreed would not apply to 'their ships'.

· Most progress achieved in developing guidance on technical and operational measures to reduce CO2 emissions, formulation of a ship Operational CO2 Index and a potentially mandatory Design CO2 Index for new ships.

· Regulatory options for the stabilisation and/or reduction of GHG emissions from the world fleet are also under evaluation at the IMO, including: a marine fuel levy, an emissions trading scheme and efficiency standards for new ships plus energy efficiency management plans for existing ships.

· Principal ways of reducing CO2 emissions currently are operational improvements, eg improved vessel utilisation, enhanced weather routing, hull and propeller cleaning, slower steaming, optimisation of logistic chains and reduction in port congestion, together with technological improvements in ship design and efficiency of engines and other energy consumers.

· Further reductions achievable in medium-long term through use of low/no carbon fuels. Natural gas (LNG or CNG) is the front runner as lower carbon fuel for the short-medium term. Hydrogen may be viable in longer term. Wind and solar energy could form a supplementary source of energy.

· Financial support by Government could encourage uptake of new technologies/ use of alternative lower carbon fuels.

· Exhaust emissions are most significant source of air pollution from ships. Key components include oxides of nitrogen (NOx), oxides of sulphur (SOx), particulate material (PM) and products of hydrocarbon combustion eg. PAH.

· Exhaust emission components are generic products of combustion. Apportioning contribution from shipping is difficult.

· Extensive review of subject undertaken by IMO in 2007 as preluded to a revision of MARPOL Annex VI on Control of Air Pollution from Ships.

· IMO recently addressed control of NOx, SOx and PM from shipping, assuming adoption and implementation of revisions to MARPOL Annex VI. UK and IMO now needs to focus effort on the more difficult challenge of achieving GHG emission reduction from shipping globally.

 

2. How significant is global shipping's contribution to climate change? How is this projected to change in the future?

 

2.1 CO2 is considered to be the most significant GHG emission from shipping. However, there will also be emissions/leakages of various refrigerant gases and methane, which will have global warming potential. Published data on refrigerant gas leakage from shipboard systems and refrigerated containers is not available. Data on methane emissions associated with carriage of gas and oil by gas ships and tankers is also difficult to locate, as is data on the methane component of exhaust emissions:

 

· Estimated CO2 emissions from shipping in 2007 = 1,120 million tonnes (IMO, 2008a);

· Equivalent to approx 4% global anthropogenic CO2 emissions;

· Projected CO2 emissions for 2020 = 1,475 million tonnes (IMO, 2008a).

 

2.2 The projection takes into account: decommissioning and fleet replacement requirements, fleet growth to handle the forecast increase in seaborne trade and an assumed 15% efficiency improvement during the period from 2007 to 2020 for all ships irrespective of type, size and age.

 

3. How should the UK's share of international maritime emissions be measured and included in UK carbon budgets? How fast could this be done?

3.1 The UK share of international maritime emissions is currently calculated (in the UK). This is not representative of emissions generated by shipping visiting in UK ports or trading in UK waters. Options such as estimating emissions on the basis of fuel consumed by UK flagged ships or whose owners are registered in the UK are equally flawed.

3.2 Sharing emissions generated by ships calling at UK ports between the port of departure and arrival would appear more equitable, but could be difficult to calculate for all international ship port callings. However, allocating the total emissions generated by international shipping on the basis of UK percentage of world GDP would be very simple and could be expected to reflect loosely the benefit the UK derives from international shipping. Using GDP figures for 2006 (Table 1), a simple calculation provides a figure of 54 million tones as the UK share of international shipping emissions.

GDP by country and as percentage of world total 2006

Country

GDP

(millions $US)

% of total world GDP

US

13201819

27.36

Japan

4340133

9.00

Germany

2906681

6.02

China

2668071

5.53

UK

2345015

4.86

India

906268

1.88

Greece

244951

0.51

Panama

17097

0.04

Source: World Development Indicators Database, World Bank, July 1st 2007

4. What are the prospects of international agreements to control and reduce carbon emissions from global shipping, or to bring it within wider emissions trading schemes? How well is the UK Government playing a role in developing such agreements?

4.1 The International Maritime Organization (IMO) has been attempting to develop and introduce measures to control greenhouse gas (primarily CO2) emissions from ships for the past decade; however the development has been blocked by a number of non-Annex I countries in terms of the Kyoto Protocol; who do not have to control greenhouse gas (GHG) emissions in the same way as developed 'Annex I' countries. These States maintain that any IMO requirement would not apply to 'their ships' and have acted together to block discussion at IMO on the issue of CO2 emissions control.

 

4.2 However, with organisations e.g. UNFCCC (UN Framework Convention on Climate Change) and EC are poised to introduce GHG emission control measures for shipping, if the IMO fails to secure agreement by July 2009, the IMO is working hard to develop and secure agreement for suitable control measures.

 

4.3 Much of the IMO activities focus on technical and operational measures to reduce CO2 emissions. These include:

· Guidance document on Best Practice for Fuel-Efficient Operation of Ships. Draft to be available October 2008 and text finalised by July 2009.

 

· Guidelines for calculating an individual ship's Operational CO2 Index - in terms of CO2 emitted/unit of freight carried/unit distance. Draft guidance available in the IMO Circular MEPC/Circ.471 'Interim Guidelines for voluntary CO2 emission indexing for use in trials'. Due for finalisation October 2008. This operational index is not likely to become a mandatory requirement but is proposed as a management tool which could be used for tracking the CO2 emissions per unit of cargo carried per unit distance for an individual ship.

 

· The Design CO2 Index is a separate concept from the operational index, although it has similar units (CO2 emitted/unit of freight carried/unit distance). Mandatory application of this index is proposed for new ships, potentially linked to mandatory performance standards.

 

4.4 In addition to the above measures, which are aimed at decreasing GHG emissions from individual ships, the IMO is examining regulatory options for the stabilisation and/or reduction of GHG emissions from the world fleet. These options include:

 

· Marine fuel levy.

· Emissions trading scheme where ship operators are required to obtain allowances for GHG emissions which would be capped at a finite emission level.

· Specific efficiency standards, similar to the design index, for new ships which could be further improved in second and third tier standards in later years. These could be coupled with energy efficiency management plans for existing ships, with mandatory efficiency improvements at a later date.

 

4.5 The IMO is aiming to reach agreement on regulatory control measures by July 2009. Should agreement not be achieved by this time, it is almost certain that the European Commission will introduce an emissions trading scheme for ships within the European Community.

 

4.6 To date the UK Government has played a relatively passive role at the IMO during the GHG emission control discussions. There has been little evidence of aproactive proposal of potential regulatory mechanisms for ship emission control.

5. What are the prospects for developing new engine technologies and fuels, as well as more fuel-efficient operations? What more could the Government do to assist these developments?

5.1 At present, there is no viable large scale low or no carbon based fuels which could significantly reduce or eliminate CO2 emissions. Electrification is not viable for shipping. The principal ways of reducing CO2 emissions are operational improvements and technological developments.

 

5.2 Existing propulsion systems with carbon based fuels are likely to be the only realistic large volume fuel for shipping over the next 20 years and probably longer. Natural gas is currently the front runner in terms of a lower carbon fuel for the short-medium term, either as liquefied natural gas (LNG) or compressed natural gas (CNG). With currently available propulsion machinery, use of natural gas could achieve around 20% reduction in CO2 emissions compared to residual or diesel oil fuels.

 

5.3 In the longer term, hydrogen could emerge as a viable solution. Sustainable biofuel may also have a role to play if sufficient fuel were to be made available to shipping. Alternatively, radically new fuels and/or technologies may emerge to play an important role.

 

5.4 Wind and solar energy could also contribute to reduced CO2 emissions, but as a supplementary source of energy rather than a total provider. Nuclear propulsion has been successfully used in naval vessels. However, nuclear propulsion requires a special infrastructure and emergency response capabilities. Added to general societal fears, it is not considered that nuclear propulsion will play a significant role in merchant ships.

 

5.5 Technologies which are available to improve fuel efficiency in the short to medium term include:

 

· Improved engine energy efficiency, hull form optimisation, propeller design, high efficiency rudders, stern flaps, improved steering configurations;

· New antifouling materials to reduce hull friction;

· Waste heat recovery from engines;

· Zero or minimum ballast configurations by design;

· Improved efficiency of minor energy consumers (lighting, air conditioning etc); and

· Use of lighter materials.

 

5.6 Different technologies will have different impacts for different ship types and sizes in different trades. The potential for technical measures to reduce CO2 emissions have been estimated at up to 30% in new ships, excluding the effect of fuel switching, and up to 20% in existing ships or ships constructed using present technology. Reductions due to alternative fuel and power systems are additional and could be significant.

 

5.7 The potential savings from operational improvements are also significant. Operational measures to reduce the fuel consumption and CO2 emissions include

· Fleet optimisation; better planning, large-scale improvements in vessel utilisation.

· Enhanced weather routing, optimized trim and ballasting, hull and propeller cleaning, better main and auxiliary engine maintenance and tuning, slower steaming.

· Optimisation of logistic chains; fewer ballast legs, larger cargo batches, optimised arrival times.

· Reduction in port congestion and other limitations on quick port turn-around.

 

5.8 Further information on technical and operational measures may be found in IMO, 2008b.

 

5.9 Technological advance in the industry can be hampered by a reluctance to try or invest in new technologies. Encouragement to do this, by for example, providing grants to help meet the cost of new technologies considered to improve energy efficiency/ reduce CO2 emissions, could assist the uptake of new technologies. A requirement to report publicly on the performance of the new technology would further improve uptake.

6. What are the effects of shipping on UK air quality and public health? How well is the Government tackling this, and what more could it do?

6.1 Exhaust emissions are the most significant source of air pollution from ships. Key components include oxides of nitrogen (NOx), oxides of sulphur (SOx), particulate material (PM) and a range of products of hydrocarbon combustion including PAH. These components are however generic products of combustion and apportioning the contribution from shipping is a challenging task.

6.2 An extensive review of the generic health implications of SOx and PM plus a compilation of those studies globally, which have tried to examine the contribution of shipping emissions to land based air quality, can be found in the report of the IMO Secretary General's 'Group of Experts', established to evaluate the effects of the different fuel options proposed under the revision of MARPOL Annex VI (IMO, 2008a). However, with the significant reduction in SOx, particulate and to a lesser extent NOx emissions, associated with the revision of MARPOL Annex VI on the Control of Air Pollution from Ships (IMO, 2008c), the future contribution of shipping to air pollution will change significantly in step wise improvements to 2020.

6.3 IMO has to a certain extent successfully addressed control of NOx, SOx and PM from shipping, assuming adoption and implementation of the revisions to MARPOL Annex VI proceeds. The UK Government played significant role in achieving this (through provision of a Chairman of the IMO Secretary General's Group of Experts and the Co-ordinator of the Health & Environment sub-group). The UK now needs to focus its effort on the more difficult challenge of achieving GHG emission reduction from shipping globally, rather than revisiting control of SOx, NOx and PM.

7. References

 

IMO, Report on the outcome of the Informal Cross Government/Industry Scientific Group of Experts established to evaluate the effects of the different fuel options proposed under the revision of MARPOL Annex VI, MEPC 57/4, 2008a

 

IMO, Per Marius Berrefjord, Řyvind Endresen, Bo Cerup Simonsen, Hanna Behrens, Sverre Alvik, Gillian Reynolds and Zabi Bazari, CO2 Emissions from Shipping - Technical and Operational Options for Emission Reduction, MEPC 58/Inf.14, 2008b

 

IMO, Draft amendments to MARPOL Annex VI Draft amendments to the NOx Technical Code, MEPC 58/5, 2008c

 

17 September 2008