‘The vast majority of ships in the German fleet will run on the new sulphur-reduced fuel’ in response to IMO 2020, according to a survey conducted by the German Shipowners’ Association, Verband Deutscher Reeder (VDR).
VDR said that 81% of the companies surveyed will be using 0.50% very low sulphur fuel oil (VLSFO), while 11% will take advantage of their scrubber installations to use high sulphur fuel oil (HSFO).
VDR added that around 6% said they will be using ‘other fuels, such as those prescribed already since 2015 for Emission Control Areas in the North Sea and the Baltic Sea – fuels with an even lower sulphur content of 0.10%’. One assumes that this includes low sulphur marine gasoil (MGO).
Around 2% of the ships in the German fleet, said VDR, ‘will already be operated using LNG after 2020, according to the survey’.
The survey respondents indicated that ‘the greatest challenge’ will be ‘technical problems encountered during operations in the future, as well as the cost of the new fuel, and the issue of cost compensation by third parties, in particular customers’.
Ralf Nagel, the CEO of the VDR, commented: ‘There are many who fear that the new fuels could cause technical problems during operation – problems that could also have financial consequences. We therefore call on all stakeholders to be as committed and flexible as possible in preparing for the changeover, to ensure that it will become a success story.’
The survey found that the one-off investment expenditure for companies in the lead-up to the changeover averaged €7.5 million per shipping company.
‘Considering that more than two thirds of the shipping companies in Germany are medium-sized and operate fewer than ten ships,’ said Nagel, ‘we realise just how great the financial effort was that the individual companies had to make in preparing for the changeover.’
Moreover, warned the VDR, the additional annual costs now facing companies would make IMO 2020 ‘probably the most elaborate regulatory measure ever implemented by the shipping industry’.
‘Companies are particularly concerned about the fact that they will have to bear considerable additional costs in their ongoing operations in the future, and that possible compensation for these added costs by third parties, in particular customers, may not work as envisaged,’ added Nagel.
Despite some misgivings about switch-over problems and ongoing costs, the VDR seemed generally sanguine about the IMO 2020 implementation.
‘Germany’s maritime industry has carefully prepared for this enormous change,’ said Nagel. ‘It ushers in a new era in maritime shipping, signalling the end of heavy fuel oil. We support this change and are implementing it – and in doing so, we are making an impressive contribution to long-term environmental protection.’