Sulphur requirements: In deciding to invest an additional £34.5 million (DKK 300 Million), DFDS is in the process of investing a total of £46 million (DKK 400million,) in new technology that can filter sulphur from ships’ exhaust gases. This is a major step in preparing DFDS for the introduction of new environmental regulations in 2015.
On 1 January 2015, new environmental regulations will come into force which will be of crucial significance to the shipping industry in the Baltic Sea, the North Sea, the English Channel and the entire northern-European transportation network. Under these new environmental regulations, ships operating in these areas will only be able to use oil with a maximum of 0.1% sulphur. Such oil is significantly more expensive than oil with 1% sulphur, which is commonly used today. Fuel prices will therefore become much more expensive and subsequently increase sea transport costs. This could potentially lead to freight being forced onto European roads and result in an increase in road congestion and other environmental problems.
For these reasons, shipping companies have been working hard to find solutions to this challenge. DFDS has decided to invest £34.5 million (DKK 300 Million) in installing scrubbers in eight more of the company’s ships in 2014. A scrubber is an air pollution control device of approx. 70 tons, which can remove sulphur from the exhaust gases produced by ship engines, and the new sulphur regulations allow for alternative solutions that have the same environmental effect as using low sulphur fuel.
DFDS has previously tested a prototype scrubber on a vessel over a period of several years and will this year complete the installment of the new sulphur removal system on three other ships. Thus 12 of our ships will comply with the new environmental regulation, with a total investment of £46 million (DKK 400million,). The installation of scrubbers on another 10 DFDS ships that are compatible with scrubber systems is also being considered.
This means that DFDS is one of the shipping companies leading the way in the preparation for the new environmental regulations.
Joint effort and transition rules required
CEO Niels Smedegaard of DFDS says: “Society and shipping companies like DFDS have a common interest in improving the environment, while simultaneously ensuring that sea transport does not become unnecessarily expensive, which could lead to an increase in shipments being transported on already congested roads. Our common aim is to maintain routes and jobs in the transport network, which help connect the business community. However, sulphur regulations will make sea transport more expensive from 2015 onwards, and this will affect both the shipping companies and their customers.
Not all shipping companies have the opportunity to make the major investment that a scrubber system requires. In addition, only about half of all ships are suitable for having scrubbers fitted. In reality, the much-discussed LNG (liquid natural gas) is only a solution for new ships.”
He adds: “Therefore we must act quickly to find solutions and, preferably, transition rules for the many ships that are not suitable for scrubber installation, possibly through temporary exemptions, if shipping companies contribute to investments in solutions where possible. Secondly, we have to work together in order to ensure the development of long-term solutions, including clear and appropriate rules for the use of scrubbers and rules that provide companies with a secure basis for deciding on investments. Otherwise, it would be financially irresponsible for shipping companies to make such large investments for the benefit of the environment and infrastructure in Europe,” says Niels Smedegaard.
DFDS, August 23, 2013