Discussion Papers, Department of Business and Management Science, Norwegian School of Economics (NHH)
Sulphur Abatement Globally in Maritime Shipping
(), Carl Fredrik Rehn
() and Gunnar S. Eskeland
Abstract: In 2016, the International Maritime Organization (IMO)
decided on global regulations to reduce sulphur emissions to air from
maritime shipping starting 2020. The regulation implies that ships can
continue to use residual fuels with a high sulphur content, such as heavy
fuel oil (HFO), if they employ scrubbers to desulphurise the exhaust gases.
Alternatively, they can use fuels with less than 0.5% sulphur, such as
desulphurised HFO, distillates (diesel) or liquefied natural gas (LNG). The
options of lighter fuels and desulphurisation entail costs, including
higher energy consumption at refineries, and the present study identifies
and compares compliance options as a function of ship type and operational
patterns. The results indicate distillates as an attractive option for
smaller vessels, while scrubbers will be an attractive option for larger
vessels. For all vessels, apart from the largest fuel consumers, residual
fuels desulphurised to less than 0.5 % sulphur are also a competing
abatement option. Moreover, we analyse the interaction between global SOX
reductions and CO2 (and fuel consumption), and the results indicate that
the higher fuel cost for distillates will motivate shippers to lower
speeds, which will offset the increased CO2 emissions at the refineries.
Scrubbers, in contrast, will raise speeds and CO2 emissions.
Keywords: Shipping and the environment; Abatement cost and options; CO2; Marine fuels; MARPOL; IMO; (follow links to similar papers)
JEL-Codes: L92; Q50; Q52; (follow links to similar papers)
25 pages, June 29, 2017
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