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Sulfur Rules to Cost Shipping Firms Millions

container shipMaersk Line says Europe’s new low-sulfur fuel rules will cost it an extra $200 million a year, Reuters reports.

Similarly, P&O Ferries’ tells the news agency its fuel bill will increase about 30 million pounds ($50 million) a year, which it will pass onto customers.

Under the European Union rules, from Jan. 1, 2015, all ships operating in the North Sea, Baltic Sea and English Channel will have to use a fuel with a maximum sulfur content of 0.1 percent.

To comply with the new rules, shipping companies can switch to low-sulfur marine fuel, which Reuters says can cost four times as much as high-sulphur bunker fuel, install expensive scrubber technology or use liquefied natural gas (LNG), which requires retrofitting.

While some say the sulfur regulations will likely drive some shipping companies out of business and force others to close routes in 2015, Britain-based ferry group Red Funnel tells Reuters it has been using low-sulfur fuel for 18 years and has maintained its competitiveness through efficiency improvements.

Earlier this month a dozen shipping companies have taken the initial steps to form a coalition to advance enforcement of maritime sulfur regulations. The companies met for an exploratory session in Copenhagen last week, at a full-day meeting hosted by Maersk Maritime Technology and Wallenius Wilhelmsen Logistics, and say they are on track to launch the Trident Alliance in the upcoming weeks. At that point, the group will announce the companies involved.

Photo Credit: container ship via Shutterstock

 

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