The decision on whether to invest in scrubber technology on containerships, ahead of the IMO’s 0.5% sulphur cap on 1 January 2020, has resulted in ocean carriers adopting a “polarised” approach, according to an Alphaliner survey.
Moreover, the for and against opinion of carriers on the installation of the exhaust gas cleaning systems has caused a major split in two of the three alliances.
Some partners are opting to burn the more expensive low-sulphur fuel oil (LSFO) on their ships in 14 months’ time, to comply with IMO2020, while others push ahead with the installation of scrubbers on their ships which enable them to continue to use heavy fuel oil (HFO).
Most notable is MSC, which according to Alphaliner, plans to equip more than 120 of its 520 owned and chartered operating fleet with scrubbers, while 2M partner Maersk Line remains firmly in the anti-scrubber camp, planning only “limited trials” on a small number of ships.
MSC chief executive Diego Aponte has made no secret of his preference for scrubbers, saying that the decision is “a no brainer”.
His view is based on the price spread between HFO and LSFO, currently around $260 per tonne, compared with the one-off $8m-$10m cost of installing a scrubber system, capital expenditure that could recovered within the first year.
According to one MSC insider The Loadstar spoke to recently, “the entire fleet would have scrubbers fitted if there was time [before IMO2020], as it will give us a significant cost advantage over the rest”.
Asked how MSC would then justify its proposed LSFO surcharge on the vessels fitted with scrubbers, he explained the surcharge would also be used to recover the cost of the scrubbers or, in the case of chartered-in tonnage, the extra cost of daily hire.
According to Alphaliner, South Korean carrier HMM has agreed to pay an additional $4,900 a day to owners from 1 January 2020 for the charter of five 5,023 teu ships fitted with scrubbers.
Based on the vessels consuming approximately 60 tonnes of fuel a day at sea, on a price difference of say $250 per tonne, HMM could potentially be some $10,000 a day better off, even after paying the extra hire.
Evergreen is also planning to equip around 70 of its vessels with scrubbers, according to Alphaliner, whereas Ocean Alliance lead line CMA CGM is limiting its scrubber investment to some 20 ships. At present, all THE Alliance partners appear to be intending to use LSFO in their ships.
Notwithstanding the requirement to recover the cost of scrubber installations, the different strategies of the carriers also brings into question the justification for their proposed low-sulphur fuel surcharges.
For example, if a container is say booked by Maersk Line from Asia to Europe but loaded on an MSC 2M vessel fitted with a scrubber, should shippers still pay a surcharge to Maersk?
At the same time, another threat to the use of scrubbers appears to be emerging after environmentalists voiced their concerns at the impact on marine life of discharging the seawater, used in the refining process of open loop scrubbers, back into the sea.
This has resulted in the banning by the Norwegian Maritime Authority of ships fitted with scrubbers from sailing in the country’s world heritage fjords, suggesting other nations could also adopt an anti-scrubber policy in conservation areas.