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Monday, 14 July 14
THE END OF THE ERA OF HEAVY FUEL OIL IN MARITIME SHIPPING - ICCT
 KNOWLEDGE TO ELEVATE
Since the 1960s, heavy fuel oil (HFO) has been the king of marine fuels. Viscous, dirty, yet inexpensive and widely available, HFO propelled a long period of robust growth in international shipping, which carries over 90% of intercontinental trade by volume each year. For many, it is the lifeblood of the maritime shipping industry.
But HFO’s low price does not reflect its impacts on the environment and human health. The sulfur content of HFO can be up to 35,000 parts per million. It is the reason that maritime shipping accounts for 8% of global emissions of sulfur dioxide (SO2), making the industry an important source for acid rain as well as respiratory diseases. In some populous port cities, such as Hong Kong, shipping is the largest single source of SO2 emissions as well as emissions of particulate matter (PM), which are directly tied to the sulfur content of fuel. By one estimate, PM emissions from maritime shipping led to 87,000 premature deaths worldwide in 2012.
The International Maritime Organization (IMO), the governing body of international shipping, has made a decisive effort to diversify the industry away from HFO into cleaner fuels with less harmful effects on the environment and human health. Effective in 2015, ships operated within the Emission Control Areas (ECAs) covering the Economic Exclusive Zone of North America, the Baltic Sea, the North Sea, and the English Channel will begin to use Marine Gas Oil (MGO) with allowable sulfur content up to 1,000 ppm. Starting from 2020, ships sailing outside ECAs will switch to Marine Diesel Oil (MDO) with permitted sulfur content up to 5,000 ppm.*
That tectonic shift also creates openings for a variety of new fuels. Liquefied nature gas (LNG), newly abundant and relatively affordable, is attracting the attention of many shipping companies. Although the lack of infrastructure and the uncertainty of future prices have slowed the “dash to gas,” many expect LNG to establish itself as one of major alternatives to HFO in the future. Lloyds Registry, a shipping classification society, expects LNG to take 11% of the market share in 2030.
Meanwhile, Stena Teknik, a Swedish company, is testing methanol, another natural gas product, but one that requires less storage space in a ship and is relatively easier to handle. While natural gas-based fuels may sometimes offer questionable climate benefits, due to methane leakage concerns, the IMO’s low-sulfur regulation may create needed openings for other zero-sulfur, low-carbon marine fuels. Tests using fuel cells on the Viking Lady, an offshore supply ship, demonstrated promising results.
Wind kites and solar panels have already been installed on numerous ships to supplement marine diesel engines. Even HFO will not completely disappear from the menu of marine fuels. Combined with scrubbers that capture more than 99% of the sulfur from the exhaust gas, HFO will continue to play an important role. Lloyds Registry reckons that HFO will represent about 40% of fuel use by 2030.
The shift to cleaner but pricier low-sulfur fuels is likely to heighten interest in the “fifth fuel”: energy efficiency. Historically, the maritime shipping industry, where energy often accounts for over half of operating costs, has responded to escalating fuel prices with innovative energy-saving strategies. To cite a recent example: in 2008, as fuel prices went through the roof, shipping lines cut their operating speeds by as much as 50%, helping many companies stay afloat amid one of the worst downturns in history. In an analysis of satellite data on ship operations, we’ve estimated that the industry can further slash 100 million ton of fuel use by 2030 through wider implementation of energy-saving measures that were adopted by industry leaders in 2011.
This is in addition to savings of 90 million tons of fuel because of the Energy Efficiency Design Index (EEDI), a mandatory program that will require new ships to achieve certain efficiency targets beginning in 2015.
The continued diversification of marine fuels and improvements in energy efficiency have important implications. First and foremost, they may alleviate concerns about the availability of low-sulfur fuels. Figure 1 illustrates one possible scenario, using our forecast on future marine fuel consumption and energy efficiency improvements as well as Lloyds Registry’s estimate of market shares for HFO and LNG. The efficiency improvement of the legacy fleet is the greatest force driving down the need for low-sulfur fuels, equivalent to adding about 110 “negatons” of fuel, or almost 24% of projected demand. HFO combined with scrubbers, EEDI, and distillates (MGO plus MDO) are almost neck and neck, each representing about 20% of fuel use in the chart. LNG is coming of age, with its share doubling between 2020 and 2030. Other fuels, such as renewables, fuel cells, and biofuels, are expected to hold only small market shares in 2030.
Second, the new fuels are on a collision course with IMO safety regulations concerning flashpoint, the temperature at which a fuel can vaporize to form an ignitable mixture in air.
The IMO currently requires marine fuels to have a minimum flashpoint of 60°C. But low-sulfur fuels have a lower flashpoint (50° to 55°C), meaning that they are “off-spec” and cannot be used under the IMO rule. The flashpoint requirement, which went into effect in 1976, was meant to provide a large margin of error to ensure the temperature of the engine room (normally below 45°C) does not exceed the flashpoint in any circumstance. But according to industry heavyweights such as Maersk and BIMCO, modern technologies such as advanced ventilation systems provide an adequate safety margin, and they argue that keeping the flashpoint requirement will cause the industry to miss the opportunity represented by the increased availability of low-sulfur, low-flashpoint fuels. Industry and member states such as the U.S. are urging the IMO to accelerate its consideration of an amendment to the flashpoint requirement.
By: Haifeng Wang / The International Council of Clean Transportation
*Implementation of the requirement is subject to a review of fuel availability to be completed by 2016.
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Thursday, 08 May 14
INDONESIAN COAL PRICE REFERENCE IN MAY CRASHES THROUGH $74
COALspot.com - The Ministry of Energy & Mineral Resources of Indonesia has revised down again the coal bench mark price by US$ 1.21 / MT to ...
Wednesday, 07 May 14
THE DRY BULK MARKET HAS NOTED ANOTHER WEEKLY POSITIVE GAIN
Chartering (Wet: Softer- / Dry: Stable+)
The Dry Bulk market has noted another weekly positive gain, driven by the Capesize segment, but we ne ...
Wednesday, 07 May 14
SGX ENHANCES ITS COMMODITIES PRODUCT OFFERING
COALspot.com: SGX is building up its bulk commodity product offerings with 9 more derivative contracts over the next 2 months, subject to regula ...
Tuesday, 06 May 14
NEWCASTLE COAL EXPORT SLIPS 7.92% WEEK ON WEEK
COALspot.com: In the week ended 07:00 hours 5 May 2014, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland ...
Monday, 05 May 14
HUANENG CLEAN ENERGY RESEARCH INSTITUTE HAS CONFIRMED TO SPEAK AT CCF2014
Press Release: Produced by CDMC Events, The 13th Clean Coal Forum 2014 will be held on June 12,13, 2014 in Beijing, China. We are glad to invite ...
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- SMC Global Power, Philippines
- Carbofer General Trading SA - India
- Edison Trading Spa - Italy
- Port Waratah Coal Services - Australia
- Bhushan Steel Limited - India
- European Bulk Services B.V. - Netherlands
- Coastal Gujarat Power Limited - India
- Uttam Galva Steels Limited - India
- Indo Tambangraya Megah - Indonesia
- Baramulti Group, Indonesia
- Krishnapatnam Port Company Ltd. - India
- Mintek Dendrill Indonesia
- Salva Resources Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- GMR Energy Limited - India
- Kideco Jaya Agung - Indonesia
- PTC India Limited - India
- Indika Energy - Indonesia
- Kaltim Prima Coal - Indonesia
- SMG Consultants - Indonesia
- Energy Development Corp, Philippines
- Samtan Co., Ltd - South Korea
- Central Electricity Authority - India
- GAC Shipping (India) Pvt Ltd
- Chamber of Mines of South Africa
- Aboitiz Power Corporation - Philippines
- Economic Council, Georgia
- Planning Commission, India
- McConnell Dowell - Australia
- Bharathi Cement Corporation - India
- ASAPP Information Group - India
- Kalimantan Lumbung Energi - Indonesia
- Jaiprakash Power Ventures ltd
- Maheswari Brothers Coal Limited - India
- Semirara Mining and Power Corporation, Philippines
- Oldendorff Carriers - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Indonesian Coal Mining Association
- Toyota Tsusho Corporation, Japan
- Meralco Power Generation, Philippines
- Sojitz Corporation - Japan
- The Treasury - Australian Government
- Madhucon Powers Ltd - India
- Straits Asia Resources Limited - Singapore
- Bukit Baiduri Energy - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Sinarmas Energy and Mining - Indonesia
- LBH Netherlands Bv - Netherlands
- Therma Luzon, Inc, Philippines
- Ambuja Cements Ltd - India
- Medco Energi Mining Internasional
- Merrill Lynch Commodities Europe
- Thiess Contractors Indonesia
- London Commodity Brokers - England
- Rio Tinto Coal - Australia
- Commonwealth Bank - Australia
- Grasim Industreis Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Gujarat Electricity Regulatory Commission - India
- MS Steel International - UAE
- PowerSource Philippines DevCo
- Aditya Birla Group - India
- Binh Thuan Hamico - Vietnam
- Sarangani Energy Corporation, Philippines
- Minerals Council of Australia
- Ind-Barath Power Infra Limited - India
- Sree Jayajothi Cements Limited - India
- Ministry of Transport, Egypt
- Chettinad Cement Corporation Ltd - India
- Mercuria Energy - Indonesia
- Bulk Trading Sa - Switzerland
- Bukit Makmur.PT - Indonesia
- IEA Clean Coal Centre - UK
- Karbindo Abesyapradhi - Indoneisa
- Formosa Plastics Group - Taiwan
- Intertek Mineral Services - Indonesia
- Globalindo Alam Lestari - Indonesia
- Orica Mining Services - Indonesia
- Georgia Ports Authority, United States
- Eastern Coal Council - USA
- Larsen & Toubro Limited - India
- VISA Power Limited - India
- Star Paper Mills Limited - India
- Electricity Generating Authority of Thailand
- Orica Australia Pty. Ltd.
- Semirara Mining Corp, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Meenaskhi Energy Private Limited - India
- Kartika Selabumi Mining - Indonesia
- Romanian Commodities Exchange
- Bank of Tokyo Mitsubishi UFJ Ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- TNB Fuel Sdn Bhd - Malaysia
- Karaikal Port Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- Eastern Energy - Thailand
- Maharashtra Electricity Regulatory Commission - India
- Makarim & Taira - Indonesia
- Kumho Petrochemical, South Korea
- India Bulls Power Limited - India
- Electricity Authority, New Zealand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Xindia Steels Limited - India
- Heidelberg Cement - Germany
- Gujarat Sidhee Cement - India
- Bayan Resources Tbk. - Indonesia
- Ministry of Finance - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indian Energy Exchange, India
- Coal and Oil Company - UAE
- International Coal Ventures Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Petron Corporation, Philippines
- Sakthi Sugars Limited - India
- Independent Power Producers Association of India
- Siam City Cement - Thailand
- Banpu Public Company Limited - Thailand
- Jindal Steel & Power Ltd - India
- ICICI Bank Limited - India
- The University of Queensland
- Kohat Cement Company Ltd. - Pakistan
- Manunggal Multi Energi - Indonesia
- Global Business Power Corporation, Philippines
- CNBM International Corporation - China
- Deloitte Consulting - India
- Cement Manufacturers Association - India
- Latin American Coal - Colombia
- Kepco SPC Power Corporation, Philippines
- Lanco Infratech Ltd - India
- OPG Power Generation Pvt Ltd - India
- Standard Chartered Bank - UAE
- Metalloyd Limited - United Kingdom
- Thai Mozambique Logistica
- Global Coal Blending Company Limited - Australia
- Directorate Of Revenue Intelligence - India
- Bahari Cakrawala Sebuku - Indonesia
- Riau Bara Harum - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Wilmar Investment Holdings
- Energy Link Ltd, New Zealand
- Vizag Seaport Private Limited - India
- Singapore Mercantile Exchange
- New Zealand Coal & Carbon
- Borneo Indobara - Indonesia
- Power Finance Corporation Ltd., India
- White Energy Company Limited
- CIMB Investment Bank - Malaysia
- Posco Energy - South Korea
- Sindya Power Generating Company Private Ltd
- The State Trading Corporation of India Ltd
- Alfred C Toepfer International GmbH - Germany
- Holcim Trading Pte Ltd - Singapore
- PetroVietnam Power Coal Import and Supply Company
- Simpson Spence & Young - Indonesia
- Siam City Cement PLC, Thailand
- Videocon Industries ltd - India
- Leighton Contractors Pty Ltd - Australia
- Goldman Sachs - Singapore
- Wood Mackenzie - Singapore
- Mercator Lines Limited - India
- Indogreen Group - Indonesia
- Dalmia Cement Bharat India
- Vedanta Resources Plc - India
- SN Aboitiz Power Inc, Philippines
- Agrawal Coal Company - India
- Pipit Mutiara Jaya. PT, Indonesia
- Malabar Cements Ltd - India
- Global Green Power PLC Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Asmin Koalindo Tuhup - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Timah Investasi Mineral - Indoneisa
- Barasentosa Lestari - Indonesia
- Bangladesh Power Developement Board
- South Luzon Thermal Energy Corporation
- Gujarat Mineral Development Corp Ltd - India
- Australian Commodity Traders Exchange
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Attock Cement Pakistan Limited
- Mjunction Services Limited - India
- Antam Resourcindo - Indonesia
- Bhatia International Limited - India
- GVK Power & Infra Limited - India
- Sical Logistics Limited - India
- Essar Steel Hazira Ltd - India
- PNOC Exploration Corporation - Philippines
- Trasteel International SA, Italy
- San Jose City I Power Corp, Philippines
- Savvy Resources Ltd - HongKong
- Africa Commodities Group - South Africa
- Pendopo Energi Batubara - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Bhoruka Overseas - Indonesia
- Ministry of Mines - Canada
- Tata Chemicals Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Parry Sugars Refinery, India
- Coalindo Energy - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Marubeni Corporation - India
- Renaissance Capital - South Africa
- Kobexindo Tractors - Indoneisa
- Australian Coal Association
- Iligan Light & Power Inc, Philippines
- Billiton Holdings Pty Ltd - Australia
- IHS Mccloskey Coal Group - USA
- Anglo American - United Kingdom
- Parliament of New Zealand
- Jorong Barutama Greston.PT - Indonesia
- Central Java Power - Indonesia
- Tamil Nadu electricity Board
- Miang Besar Coal Terminal - Indonesia
- Indian Oil Corporation Limited
- Interocean Group of Companies - India
- Altura Mining Limited, Indonesia
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