The UK Chamber of Shipping hosted their third, and final Ballast Water Management (BWM) Implementation Forum of 2016 in collaboration with Fathom Maritime Intelligence.
In this spotlight feature, Ship Efficiency review examines the issues debated at the forum in addition to giving you, the reader a round-up summary of the key outcomes.
This forum, the last in the 2016 series, proved to be an opportune time for industry stakeholders to gather and discuss the very recent ratification of the Convention just 11 weeks ago. There is still a lot of uncertainty regarding the amendments of the G8 Guidelines, and with financial markets tough and no USCG Type Approved systems on the market, just understanding the Convention’s requirements, let alone complying with it, is certainly a real challenge for ship owners and all involved.
The forum’s debates and discussions were chaired by Straun Robertson, Head of Legal Services at Clarkson’s Platou.
The IMO Addresses BWMS Selection Difficulties
The International Maritime Organization’s (IMO’s) Technical Officer in the Marine Environment Division, Markus Helavuori was the first speaker to take the podium at the forum. He explained that although a great deal of information on the Convention exists, and it can be difficult for people to get their heads around it, particularly following the Marine Environment Protection Committee’s (MEPC’s) 70th session.
“Not only are there a variety of ballast water management systems (BWMS) to choose from, and several more in development, but drawing long-term conclusions and reliability analyses from such systems is increasingly difficult as they do not always function as intended”, stated Helavuori. There are a few systems installed on ships, but many are not actually in operation at the moment or have not been for a long time and it is therefore difficult to make decisions based on their long-term performance and reliability, said the ballast water expert.
Early Mover Penalties Grace the Agenda
What has been made clear is that early movers will not be penalised, reiterated Helavuori. After October 2020, ships’ BWMS will have to meet the updated G8 Guidelines, but until then, the uncertainty over penalisation of early movers has been halted.
However, Anna Ziou, Policy Manager to the UK Chamber of Shipping, raised an interesting point regarding the decision to not penalise early movers. As Ziou stated, the regulation says that ship owners will not be required to replace a ballast water treatment system (BWTS) for the life of either the vessel or the system itself if they have already installed one prior to the implementation of the Convention. However, the key problem lies in that if the BWTS life outlives the ship, it cannot be installed to another ship and still remain compliant. Therefore, the system could have a reselling value of zero as once the ship it was installed on comes out of operation, the system has no value as it cannot be installed to the owner’s newbuild and still be in compliance with the regulation.
IMO versus USCG – Confusion Set to Continue
As echoed by other speakers, Ziou drew upon the difficulties owners face with two different requirements set by the International Maritime Organization (IMO) and the United States Coast Guard (USCG). While the IMO focusses on assessing the feasibility of a BWTS using a viable/non-viable organism approach, the USCG requires organisms to be either dead or alive in order to pass or fail its Type Approval testing. The fact that there are no USCG Type Approved systems to date, while the Coast Guard doesn’t look like it will align its regulations with the IMO anytime soon, makes this an increasingly challenging hurdle to jump, Ziou said.
UK Chamber Flags Talks Contingency Plans
Other difficulties of implementing the Convention also lie in the fact that there is still much uncertainty as to whether the second text will be accepted and if so, it may not benefit many and just add more uncertainty, Ziou confirmed. Ship owners need to add contingency measures into their BWM plans, but often the options to take are difficult to decipher and as ports are not included in the Convention, this can be challenging Ziou stated. If ship owners decide on a plan following the breakdown or faulty functioning of their BWTS, they can implement contingency plans to deal with it. However, if ports decide not to accept the contingency, then what are ship owners to do, Ziou asked.
Shocking Statistics Laid Bare
In terms of statistics, Stephen Gordon, Managing Director of Clarkson’s Research Services, revealed that 30,000 ships will eventually need to be fitted with ballast water treatment systems (BWTS), requiring a new outlook on market growth.
To date there are approximately 3,500 ships that have installed with ballast water treatment systems (BWTS), with 34% of this made up from bulkers and 19% tankers. However, ship owners face difficulties when selecting systems as there are around 37 manufacturers to choose from, and although ultraviolet irradiation (UV)-based BWTS have seen the greatest uptake, accounting for 37% of systems installed or on order today, revealed Gordon, but using these can increase the energy requirements by 400% – not something ship owners want, the first session’s panel revealed.
US: Still a Barrier to BWMS Investment
Another issue is that the timing of retrofitting may be driven by the United States and the fact that they have no approved systems is a huge concern. According to Gordon, 6% of all import and export trade involves the U.S., while in the last six months over 6,500 ships have called into U.S ports. Such large involvement with the U.S. and its controlled waters means that ship owners really need clarity from them in order to trade effectively and compliantly in their waters, and this clarity is something we need to push for at the moment highlighted Gordon.
lack of cash flow and thee weak markets mean that financing is trickyIn terms of the financial side of this, Alan McCarthy, an Independent Consultant and finance expert, revealed that “if the deal is good enough, money will be made available”. At the moment there is a lack of cash flow and the weak markets mean that financing is tricky. Increasing regulations within a fragmented shipping industry means that banks feel penalised when investing their own capital, and therefore “we need to ween ourselves off borrowing money from banks”, McCarthy pointed out.
McCarthy urged ship owners to go to suppliers directly and see what credit agencies are available and what they offer in order to increase their chance of gaining financing for equipment.
USCG Joins via Video Link
An international call with USCG members, including Meridena Kauffman, Incident Management & Preparedness at USCG, Mike Rand and John Sedlak from USCG Office of Commercial Vessel Compliance, and Maria Wiener from the Marine Safety Centre, revealed that the 30-day time period for Type Approval applications that the USCG had stated before actually refers to the response time, and not the approval time.
With the complexity of the regulation, each application is around 4,000 pages, which needs to be reviewed, and so it is a timely process that is made up of further examination, laboratory reports and confirmation, Kauffman relayed to the floor.
When Will the first USCG Type Approved BWTS Arrive?
Of course, the question of when the first USCG Type Approved BWTS will occur was asked. This cannot be determined in advance, was the answer. At the moment there are around 9,300 vessels arriving in U.S. water every year, making one or more visits to the U.S. Kauffman revealed, so it is important that a BWTS is approved to the Coast Guard’s standards, but knowing when this will happen is difficult. At the moment there are a number of ongoing discussions with laboratories, and “it is likely that it will be soon, but we can’t pinpoint exactly when soon is”, stated Kauffman.
Non-Compliant BWTS Addressed by USCG
In terms of non-compliant or faulty BWTS, the USCG urged ship owners to ensure that they get in touch with the Coast Guard at the earliest opportunity when voyaging and planning to enter U.S. waters in order to let them know why the ship or system is not in compliance. The USCG will then make a decision as to what to do on a case-by-case basis, but “the earlier you get in touch, the more likely chance we have to review the case”, they specified.
What Next?
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