The European Commission (EC) has clarified its position regarding sulphur in marine fuels. In Rueters yesterday it was reported as saying that switching fuels or fitting exhaust filters to meet the new limits will cost the shipping industry between 2.6 billion and 11 billion euros ($3.3 billion-$14 billion). That sum would be far outweighed by public health savings of up to about 30 billion euros.
A number of articles have appeared in the last few days reporting on Wednesdays meeting of the EU diplomats and have, to an extent created some confusion, with the lobbyists claiming a victory in their demands for delay. For the sake of clarity, our understanding of the situation is as follows:
1. The Commission is committed to the implementation of the 0.1% sulphur limit in emissions control areas by 1 January 2015
2. The EC will implement the IMO global 0.5% limit by 2020 in its territorial waters regardless of whether the IMO defers globally
This legislation is programmed to pass through the full parliament vote no later than September 2012.
There can be no doubt that the shipping industry faces significant challenges in achieving compliance, but equally there is capacity in the exhaust filters (sea water scrubbing) market to accommodate a great deal of demand which is simply waiting for the orders to be placed.
As we have said all along, we and other suppliers are actively seeking to work with ship operators to provide a solution and perhaps now that the EC has set out its stall and once the final vote date is set, ship owners and operators will see the value in proactively engaging with the supply market to jointly solve the problem.
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