Shipowners disappointed with LNG infrastructure decision

According to the European Community Shipowners’ Association (ECSA), shipowners’ hopes have been dashed over LNG infrastructures.

ECSA Secretary General, Patrick Verhoeven, commented: “Shipowners’ hopes for decisive action with regard to LNG refueling points have been shattered.

LNG dilemma

“While the 2015 deadline for the compliance with the requirements of the EU Sulphur Directive is fast approaching and with time running out, it was our hope that the EU would break the LNG chicken and egg dilemma by deciding that major European ports will need to have LNG refuelling points in place by latest 2020 so as to coincide with the 0.5% limit in sulphur content of bunker fuels in EU waters.”

Member States, the European Commission and the European Parliament have agreed in the context of informal negotiators on a text that would considerably weaken the initial Commission proposal for a Directive on the use of alternative fuels infrastructure in Europe.

According to the agreement, Member States will have to ensure that “a sufficient number” of big European ports have developed LNG refuelling infrastructure for maritime transport by 2025.

EU Sulphur Directive

The EU Sulphur Directive aims at the reduction of sulphur emissions from maritime transport in the SECAs (Sulphur Emission Control Areas – Baltic Sea, North Sea and the English Channel) by rendering the recent IMO (International Maritime Organisation) rules mandatory in the EU. According to the Directive, sulphur content in marine bunker fuels will have to be reduced to 0.1% by 1^st January 2015 in the existing European SECAs, and to 0.5% by 2020 in the rest of Europe.

One of the main concerns expressed by the shipping industry is that costly investments in LNG are not conceivable as long as the LNG distribution network is basic and incomplete. On the other hand, ports are less inclined to invest in alternative fuel infrastructure if the demand from the shipping industry is weak.

By making the availability of LNG refuelling points in major EU ports mandatory, the EU would have been able to break the ‘chicken and egg dilemma’ and could have helped EU shipowners overcome an important hurdle.

Conclusion

Verhoeven concluded: “Our disappointment is all the greater not only because the 2025 deadline, as agreed between the Commission, the Council and the European Parliament, will only come five years after the 2020 deadline by which shipowners across the EU will have to switch to compliant fuel, but also because this particular Directive seemed to be the only remaining field in which the EU could effectively lend a helping hand to the shipping industry in its efforts to meet the sulphur requirements both inside and outside SECA areas.

“The deadline of 2025 is simply too far to have an impact. We urge the three institutional players to reconsider their position on the matter at their next trialogue meeting on 19^th March, lest this become a missed opportunity to assist the shipping industry in a meaningful way.”

The ECSA position on the Commission's proposal for a Directive on the deployment of alternative fuels infrastructure in Europe can be found here.

Adapted from press release by Katie Woodward

Read the article online at: https://www.lngindustry.com/lng-shipping/12032014/shipowners_disappointed_with_lng_infrastructures_279/