Cleaning up smokey funnels could could land New Zealand shippers with much higher fuel bills as the Government inches towards cutting pollution levels.
The Ministry of Transport will shortly begin public consultation on whether to ratify Annex VI of an international maritime convention (MARPOL) which makes use of lower sulphur level fuel mandatory from 2020.
Shipping line Maersk converted to using the cleaner burning fuel in New Zealand waters in 2011, but switched back after its fuel bill soared by $1m during the one year trial, forcing the company to turn down a nomination for a Clean Air Society achievement award.
Maersk makes about 1000 New Zealand port visits a year and its oceania operations manager Stuart Jennings said the more expensive fuel cut sulphur levels in exhaust gases by more than 80 per cent, but the company regrettably suspended the pilot due to lack of support from other local industry stakeholders.
“We believe that a strong enforcement regime is crucial to ensure a level playing field for carriers as well as shippers, and to make sure that health and environmental benefits are continuously maximised.”
Jennings said that from 2020 all vessels in its global fleet would comply with the Annex VI requirement to reduce maximum sulphur levels from 3.5 per cent to 0.5 per cent, regardless of whether New Zealand had ratified the clause.
Atmospheric scientist Jennifer Barclay nominated Maersk for the clean air award and said the company’s switch to cleaner burning diesel reduced the amount of sulphur released into Auckland skies by 72 tonnes a year.
It was disappointing other shippers had not followed suit, but she understood Maersk’s reversal. “It’s not their fault, central government needs to pull finger and do something.”
Ministry of Transport international connections manager Tom Forster said the Resource Management Act allowed for discharges into air for normal ship operations, and New Zealand had not previously signed up to Annex VI “because our weather conditions and comparatively small ship numbers meant maritime air pollution was not seen as a significant issue.”
He said domestic legislation would need to be changed if ratification was agreed on once consultation was completed.
NZ Shipping Federation executive director Annabel Young said she expected New Zealand to ratify the clean fuel clause by 2023, but 98 per cent of shipping capacity worldwide had already done so. “We are the outlier.”
Her members, who include the InterIslander, Strait Shipping and Coastal Bulk Shipping, were anxious to know where they stood over the supply and cost of low sulphur fuel.
Diesel was the only fuel in New Zealand that met the specified sulphur content, but cost up to 50 per cent more than what many vessels currently used, and it was unclear whether the Marsden Point refinery would retool to produce low sulphur marine fuel, said Young.
A Refining New Zealand spokesman said they were still investigating options for the refinery to make 0.5% sulphur fuel oil.
“That process will give a good indication of the production costs involved, and quantities we can make on behalf of our oil company customers.”
Young said another complication was that a recent amendment to Annex VI prevented ships entering the ports of more than 80 signatory-countries from carrying dirtier-burning heavy fuels.
That meant New Zealand coastal ships, such as the interisland ferries, would have to switch fuel before entering dry docks in Australia or Singapore, and it cost hundreds of thousands of dollars
“Switching fuels takes months, it’s not something you do lightly …going to dry dock will be a very expensive transition.”
Young said that methanol was a clean fuel option that more shippers were seriously considering, but there were questions about the security of supply once the Crown Minerals Amendment Bill passed.
However, a Methanex New Zealand representative said that would not be an issue. “If the shipping industry used methanol we’d be guaranteeing supply.”