The Wall Street Journal
(Copyright (c) 2007, Dow Jones & Company, Inc.)As air pollution rises on the global political agenda, pressure is mounting on a largely hidden and proliferating source of dangerous emissions: the shipping industry.
The corpuscles of the global economy, ships carry more than 90% of the world’s merchandise by volume, and the tonnage of cargo sent by ships has tripled since 1970. Yet the fuel propelling them is cheap and dirty and produces an especially noxious exhaust.
Ships release more sulfur dioxide, a sooty pollutant associated with acid rain, than all of the world’s cars, trucks and buses combined, according to a March study by the International Council on Clean Transportation. That study also found that ships produced an estimated 27% of the world’s smog-causing nitrogen-oxide emissions in 2005. Only six countries in the world emitted more greenhouse gases — which trap heat in the atmosphere, warming the globe — than was produced collectively in 2001 by all ships larger than 100 tons, according to the study and United Nations statistics.
The global shipping industry is mired in an internal struggle over how to cope with its emissions problem, and no simple strategies have emerged for regulating the open seas.
But demands for solutions are intensifying. Assertive governments and a few ports that wield substantial commercial power are proving that local action can reverberate internationally. Since Jan. 1, the state of California has required ships sailing within 24 miles of its shores to use cleaner-burning fuels in their auxiliary engines. Similar to a 2005 measure governing Europe’s Baltic Sea region, the California law restricts access to America’s two largest ports, Los Angeles and Long Beach. Ships that don’t comply can be fined or impounded.
The prospect of authorities around the world adopting different standards for fuel and emissions worries many in the shipping industry. For commercial reasons, most ship owners and operators prefer burning less expensive, if dirtier, fuel when sailing outside a protected zone. Yet the procedures for switching back and forth between different types of fuel are complicated and potentially hazardous.
So a few of shipping’s largest players are making an unprecedented proposal for a single, strict limit on sulfur emissions in all oceans.
“The general population of the world would have to pay an extra one or two cents for their beer, but you’d solve the [sulfur] emissions problem,” says Pradeep Chawla, an executive of Hong Kong-based Anglo-Eastern Ship Management Ltd.
Yet the ravenous appetite of consumers for imported goods is growing so fast that marginal cuts in emissions would likely make no difference. Even a 30% decrease in carbon emissions from ships could be offset by the expanding size of the world’s fleet, says Russell Long, vice president of environmental group Friends of the Earth, a respected authority on the subject.
A U.N. study concluded that a 10% reduction in sailing speeds could cut ships’ carbon-dioxide output by 23%. But slower speeds would likely prompt shipping lines to deploy more ships to satisfy their customers. “By adding vessels, you’d burn more fuel and generate more pollution, and the benefit of going slower might be canceled out,” says Stanley Shen, a spokesman for Orient Overseas (International) Ltd., a shipping concern based in Hong Kong.
One big culprit is the industry’s favorite fuel. Most ships rely on residual fuel oil, also known as bunker fuel, to power their huge engines. Bunker fuel is a tar-like sludge left over from the refining of petroleum. It often contains toxic heavy metals such as lead and vanadium and is collected from the bottoms of the distillation towers in which refineries process crude. Raw, unheated bunker fuel has the composition and consistency of asphalt.
“You can walk on it,” says Claus Jensen, the fleet manager at Torm, a shipping company based in Copenhagen.
It also is cheap. A recent spot price for intermediate-grade bunker fuel traded in Singapore averaged $505.50 a metric ton, less than two-thirds the rate of marine gas oil, a distillate similar to what diesel trucks use.
“Ship owners have had a very cheap fuel that’s packed with energy, and the refiners have had an outlet for their waste product,” says Ian Adams, secretary-general of the International Bunker Industry Association, a group of firms that supply and trade bunker fuel. “Ship owners and refiners have had a perfect relationship.”
That synergy has come at a cost. This month, a peer-reviewed study in the American Chemical Society’s journal Environmental Science & Technology estimated that underregulated air pollution from ships is causing 60,000 cardiopulmonary and lung-cancer deaths annually, mostly along trade routes in Asia and Europe.
At current rates of growth, oceangoing ships will generate 53% of the particulates, 46% of the nitrogen oxides and more than 94% of the sulfur oxides emitted by all forms of transportation in the U.S. by 2030, the Environmental Protection Agency estimates. That compares with levels for the same pollutants in 2001 of 17%, 12% and 49%, respectively, according to the EPA.
A 400-yard ship named the Evelyn Maersk represents one effort to address the problem. Owned by Danish shipping giant A.P. Moeller-Maersk AS, the vessel guzzles 10% less fuel than it otherwise would thanks to an innovative boiler system that converts heat from its main engine into power that helps turn its propeller shaft. Like many ships, the Evelyn Maersk purifies its bunker fuel in a superheated labyrinth of filters, tanks and centrifuges packed into a sweltering room next to the main engine.
Even so, every full day that it cruises at sea, this sky-blue leviathan spews roughly 10 tons of nitrogen oxides plus other airborne contaminants. By comparison, all the road vehicles in London churn out 11 tons of nitrogen oxides every three hours, according to an estimate by conservation group Greenpeace International.
The U.N. agency that regulates shipping, the International Maritime Organization, has a membership of 167 fractious national governments, and its Marine Environment Protection Committee has been slow to make policy. Part of the problem is that shipping representatives, oil companies and environmental groups alike lobby to influence committee decisions.
In addition, splits within the shipping industry itself can slow progress; ship owners, for example, have different priorities than firms that charter vessels for short periods.
When the committee gathered in London in July, its working group on air pollution spent much of a three-day session discussing procedural details, including the punctuation in its final report, according to one of the group’s participants.
The IMO’s strongest move against air pollution was the adoption in 2005 of a 4.5% limit on the amount of sulfur allowable in marine fuel. That measure took 17 years for IMO members to debate and ratify, and by then the average sulfur content in marine oil had already decreased to half the 4.5% level.
IMO spokesman Lee Adamson concedes that the agency has accomplished little so far to curb air pollution but predicts it will agree as early as next April to toughen standards. The IMO “is working to a timetable that’s been developed and agreed by its 167 member governments,” he says, adding that they have “looked at the [emissions] issue in all its complexities and understood its multifaceted nature.”
In December, fuel emissions from the shipping and aviation industries will be on the agenda when world leaders meet in Bali, Indonesia, to begin haggling over a climate-change agreement to replace the Kyoto Protocol, the international treaty aimed at curbing global greenhouse-gas emissions.
In the U.S., the EPA says it is developing new rules on ship emissions, including one that would apply some of the same standards to marine engines that it enforces already for train locomotives. The agency says it also has urged the IMO to tighten international controls, believing that a global consensus is the best way forward.
Others say the EPA is moving too slowly. California Sen. Barbara Boxer has proposed a bill along with fellow California Democrat Dianne Feinstein that would require ships within 200 miles of U.S. shores to slash the sulfur content of their fuel to a scant 0.1% by 2010. In October, Friends of the Earth weighed in with a lawsuit against the EPA seeking a similar low-sulfur coastal zone. EPA officials say they are considering such a zone in conjunction with Canadian authorities.
As it tends to be on environmental issues, California is out front. In early 2006, the commissions of both the Long Beach and Los Angeles ports held a series of public meetings to address ship-related pollution. Area residents who blamed their cancers and their children’s asthma on smog from the ports showed up in force. “In the first meetings, they would come out and say, ‘You guys are murderers,'” recalls S. David Freeman, president of the Los Angeles Board of Harbor Commissioners.
Martha Cota, a parenting instructor in Long Beach, lived for years with her family just 15 blocks from the city port. She and two of her four children are asthmatics. Exhaust from ships and container trucks afflicts them, and Ms. Cota says her own breathing problems vary according to the level of port-related activity. “It gets worse when the traffic is bad — the wheezing, the pain in my chest,” she says in Spanish through an interpreter.
A 2006 California Air Resources Board study found that the Los Angeles and Long Beach ports generated more than one-fifth of all the diesel-particulate matter in Southern California in 2002. The smog from ships, trucks and cranes at the ports caused an estimated 29 premature deaths, 750 asthma attacks and 6,600 lost work days that year, the report said.
In June 2006, the two ports jointly announced a $2 billion plan to slash harbor emissions by 50% over five years by targeting ships and the trucks that shunt freight to and from them. On Jan. 1, the Air Resources Board barred the use of dirty fuels within 24 miles of state shores. In about 60 random inspections of ships this year, officials have found only four violations.
Elsewhere, the cities of Seattle and Tacoma, Wash., and Vancouver, British Columbia, have agreed to ambitious targets to reduce air pollution from ships entering their ports by 2010. Sweden, Germany and several other countries along Europe’s Baltic Sea turned it into a special zone where ships must cap the sulfur content of their fuel at 1.5%. In August, the European Commission expanded the 1.5% umbrella to include the North Sea and English Channel.
The imposition of local restrictions creates a dilemma for ship owners and managers. Many ships now carry different grades of fuel, switching between them as required at various points in a single journey. This practice, however, can be dangerous.
If a ship tries to switch between fuels that are incompatible — a common risk — waxes in bunker fuel can separate out like “curdles in milk” and clog fuel filters, says Martin Cresswell, director and fleet general manager at China Navigation Co., a shipping line headquartered in London. Lighter components in incompatible fuels can turn into gas and cause a “vapor lock” that stalls the engine. Mr. Cresswell’s nightmare is a big ship adrift without power amid the towering swells of a Force 10 storm at the crowded entrance to the English Channel.
The risks and impracticality of switching fuels have persuaded two big shipping groups to seek a radical solution. Both the International Association of Independent Tanker Owners, or Intertanko, which represents 70% of the world’s independent tanker fleet, and the Hong Kong Shipowners Association want the IMO to require ships to give up bunker fuel and use only distillates containing no more than 1% sulfur — far below the current 4.5% IMO standard.
The International Bunker Industry Association calls any proposal to replace bunker with distillates impractical. Oil companies say that if ships burned only distilled fuel, refineries would need to process roughly 12 million additional barrels of crude oil daily — more than the entire output of Saudi Arabia.
But Intertanko argues that if the IMO set a deadline for ships to adopt distillates, then refiners would have an incentive to invest in new capacity.
Other ideas, meanwhile, draw on ancient seamanship. Wallenius Wilhelmsen Logistics of Oslo has designed a concept ship that would produce zero emissions by harnessing power from the sun, waves and wind.
SkySails of Hamburg, Germany, is already marketing “towing kite propulsion systems” — large parasails — that it claims can reduce a ship’s fuel costs by as much as 35%. The first commercial cargo ship to be equipped with SkySails parasails will enter service in December.
(See related letters: “Letters to the Editor: Ah, A Whiff of Maybe Not So Fresh Sea Air” — WSJ December 1, 2007)