While ro-ro providers outside the Baltic and North seas sail under a sulphur content cap of 3.5% until 2020, short sea ro-ro shippers operating there face a reduction to 0.1% by 2015. The International Maritime Organisation’s regulations could cost them €40,000 ($50,000) per journey, a move that threatens to force freight off short-sea ro-ro routes and back on to roads. But have deep-sea operators sold out their short sea ship mates?
According to the shipping line representatives gathered at last week’s RoRo 2010 conference in Bremen Germany, it’s a purely political decision taken by the IMO and runs counter to the interests of the EU’s Marco Polo project, designed in part to shift freight transport from road to sea.
Annex VI of the IMO MARPOL regulations, which was allegedly brought in without consideration for any counterargument, demands that the sulphur content of marine fuels used by shipping lines in the Baltic and North Sea sulphur emission control areas (SECAs) be reduced to 0.1% by January 1, 2015. (A similar 200nm zone is also planned for the US and Canada.)
During the conference’s first roundtable discussion, Hanns Conzen, managing director of TT Line, described the IMO regulation as “catastrophic” and said it discriminated against any ro-ro business in the North and Baltic seas from 2015 onward.
Talking about the €35,000-€40,000 cost for a typical journey between Germany and Finland, Conzen said, “that is more than you pay on the charter for one ship, and we are trading on more than 600 ships in the North Sea and Baltic Sea. It is unbelievable that nobody who made this legislation had a look at the price list.”
Adding to the discussion Bo Severed, managing director of Stena RoRo said the sulphur limit was counterproductive and would lead to a modal shift back to road.
As well as the contradiction in EU directives to move freight off the roads and onto short-sea routes, the proposals threaten a massive increase in vessel operating costs and a lowering of competitiveness against other modes. It also runs counter to the notion of an international shipping sector adhering to the same rules, with the sulphur cap for shipping outside the SECA zones kept at 3.5% until 2020 (when they will be reduced to 0.5%).
Kell Robdrup, managing director of Norfolkline Shipping, admitted that perhaps his industry was not as good as the container carriers at lobbying the right authorities or making itself heard in the right forums. “Our colleagues in deepsea can do that without any problems. They can do space charters between each other to optimise the project. We have not been able to do that. We have a lot to learn from the container business.”
And returning to the disparity on its trade route in sulphur percentages Conzen pointed out how crazy it was that from 2015 TT Line would be sailing on one side of the UK, towards the Irish Sea, with a 3.5% cap, while on the other side it will be 0.1%.
He went on to point out that if shipping is international, then shipping lines need the regulations to be similarly international: “If the politicians decided to segment it and make a special rule for Baltic and one for North Sea, then shipping it is not international anymore.”
This led conference chairman and CEO of the Danish Transport and Logistics Association, Erik Østergard, to ask whether he detected the accusation of a survivalist strategy on the part of deep sea operators who might have sold out on short sea operators by agreeing to fixed regulations in order to avoid too much restriction when they got to deep sea routes.
“Please understand that I will not comment on that,” said Conzen.
So why have shipping lines sat by during a decade in which EU legislators have focused on emissions reductions in the transport sector, moving from land transport to sea? As Østergard asked, “have you been sleeping?”
According to Tapani Voionmaa, head of the Euro Ro-ro Carriers Action Group (Eurocag), they had not.
“Today there is tremendous work done by Nordic ship owners in order to get the Commission and IMO to understand the tremendous impact 0.1% will have,” he said, pointing delegates to the impact studies produced by ECSA and Finnish Ministry of Transport.
“Some might think [the sulphur debate] is lost and it is a very difficult battle because it was a convention that was signed without any counter arguments…but the battle is not over yet.”