HK's Updates: Shippers renew low-sulphur fuel pact (26 Jan 2013)

Shippers renew low-sulphur fuel pact
Saturday, 26 January, 2013, 12:00am

Firms agree to continue using greener diesel while berthed here to ease air pollution but say it could all end if there is no mandatory regulation

A raft of shipping companies have extended, for another year, their voluntary scheme to use low-sulphur fuel to reduce air pollution from ship emissions while berthed in Hong Kong.
But they warned they could end the initiative, called the Fair Winds Charter, if "there is no substantial progress towards mandatory regulation by December 31, 2013".

The firms, who are members of the Hong Kong Liner Shipping Association (HKLSA) or the Hong Kong Shipowners' Association (HKSOA), also urged the government to improve and simplify the incentive scheme launched by the Environmental Protection Department in September.

Nearly 570 ships have been registered for the scheme, which gives a 50 per cent reduction in port- and navigation-related charges for oceangoing ships using low-sulphur diesel.
Tim Smith, chairman of the HKLSA, said the incentive scheme covered only part of the extra cost of using the more expensive cleaner low-sulphur fuel.

He said the actual proportion varied among shipping companies but for Maersk Line, where Smith is chief executive for north Asia, the cost was between US$1.5 million and US$2 million. Smith, speaking at yesterday's event extending the charter, said more help "would be better".

Christine Loh Kung-wai, undersecretary for the environment, said legislation requiring oceangoing ships to use low-sulphur fuel was expected to be lodged with the Legislative Council after the summer recess. Loh hoped it could be approved by Legco "sooner rather than later".

Secretary for the Environment Wong Kam-sing said mandatory fuel switching at berth was the government's "near-term target", while an internationally recognised emission-control area covering the whole Pearl River Delta "is a long-term goal". This would be similar to control areas in North America and Europe.

Loh said preliminary discussions with officials in Guangdong and the Ministry of Transport in Beijing to create the emission-control area had begun and they were "aware of what we would like to do".

The Civic Exchange think tank says marine sources of sulphur dioxide account for 519 premature deaths a year in the Pearl River Delta, including 385 in Hong Kong. If all container lines calling at the city switch to the cleanest fuel available, sulphur dioxide emissions from shipping will drop 80 per cent.

Loh said some initial consultation with the shipping industry over mandatory use of low-sulphur fuel started on the day of the policy address.

But the government was also aware that smaller firms, whose ships may not be able to use low-sulphur fuel or find it difficult to switch, were not members of either association.

The department would "in a matter of days engage with them" to get their feedback on the plans, Loh said.

Arthur Bowring, HKSOA managing director, hoped shipping firms would discuss their difficulties with a compulsory fuel switch, adding that "outright objection is not an option".

Christine Loh Kung-wai. Photo: David Wong

Source:
http://www.scmp.com/news/hong-kong/article/1136212/shippers-renew-low-sulphur-fuel-pact