New Global Fuel Requirements Mark Monumental Change for Shipping

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On January 1, 2020, all ships will be required to meet new fuel requirements, commonly referred to as IMO 2020, marking the most significant global regulatory change in decades. The limit for sulphur in fuel oil used on board ships operating outside designated emission control areas will be reduced to 0.50% m/m (mass by mass) from 3.5% m/m. This will significantly reduce the amount of sulphur oxides emanating from ships and should have major health and environmental benefits for the world, particularly for populations living close to ports and coasts. Since 2015, Canada and the United States implemented an even more stringent requirement within 200 nautical miles of their coastlines, demanding that ships only use fuel with a maximum sulphur oxide content of .1% m/m or specific alternative measures.

Ship owners will be afforded certain options and flexibility for compliance to the new global regulations and may choose different approaches for their vessels depending on a number of operational and technical factors. For example, building or retrofitting a ship to be fueled by liquified natural gas (LNG) may be appropriate for a vessel on a regular route with known sources of LNG. Of course, this type of approach would also be very costly so the investment is best made with a new build where the investment may be amortized over the life of a vessel (20 plus years).

The International Maritime Organization (IMO) also considers exhaust gas cleaning systems (EGCS) to be an acceptable means of reducing vessels’ sulphur emissions and ensuring compliance with MARPOL Annex VI. A separate IMO guideline specifies the requirements for the verification, testing, survey and certification of scrubber systems and sets out the criteria for discharging EGCS wash water into the sea. In Canada, Transport Canada is the regulator responsible for monitoring these guidelines and has made adherence mandatory in Canada’s Vessel Pollution and Dangerous Chemicals Regulations. Canada has committed to upholding the requirements of MARPOL Annex VI through its national regulations, which means that Canada is being stringent in meeting its national and international commitments, and providing a predictable regulatory framework that promotes trade globally.

A Canadian Non-Governmental Organization recently called for a ban of heavy fuel oil and the use of EGCS claiming that wash water was harmful to coastal waters, but recent studies have scientifically demonstrated that EGCS can meet and exceed the IMO’s emission guidelines and also achieve the water wash standards. EGCS have been used on board ships for years and the technology is well developed. Of course, EGCS must be installed, maintained, and operated correctly, in addition to being monitored frequently for their performance compliance. In this respect, the monitoring of ships with EGCS for compliance with the IMO guidelines will be crucial. Regardless of the experience with this type of technology, the IMO has committed to reviewing their effectiveness in the coming years through one of its subcommittees.

A schematic of a typical hybrid exhaust gas scrubber system.


IMO 2020 is a monumental shift in approach for shipping that has demanded careful attention and coordination with fuel suppliers and shipyards. For companies choosing to switch to lower sulphur fuels, their ships’ fuel tanks must be cleaned prior to embarking the new fuel. For companies choosing to switch to alternative fuels or use exhaust gas scrubbers, there has been a heavy technical demand on shipyards gloablly to retrofit existing vessels and even build new ones. Needless to say, the level of investment to be prepared for such a change has been in the billions of dollars. Accordingly, ship owners and operators are calling for global adherence to the requirments of the regulations so that there is a level commercial playing field.


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