ship-yards start feeling the negative effects as incoming orders fall and access to credit is being re-duced.
7 Data sources and monitoring options
A key question is the monitoring and enforcement of the policy measure. The challenge of data needs and availabilities are situated in the triangle of international law, (supra) national jurisdictions and environmental ambition. Furthermore, the decision which emissions are considered the baseline for setting up the scheme also influences the data needs. In the following sub-chapters, the possibilities and data needs for identify-ing the absolute sectoral emissions and for settidentify-ing the cap are discussed. Subse-quently, the bases of assessment / trading and corresponding data needs and monitor-ing requirements for the three selected options are discussed in chapter 8.
in-clude the carbon content of the fuel (Kågeson 2007), although deviations if using lit-erature data would be small.
Figure 4: World fleet fuel consumption based on different bottom-up esti-mates and statistics based on fuel sold
Source: IMO (2009)
A significant level of uncertainties in bunker fuel reporting remains, despite the obvi-ously improving data situation with the mandatory Bunker Fuel Delivery Notes (BFDN).
As greenhouse gas reporting from vessels relies on only one parameter – the fuel pur-chased in a period of time – this level of uncertainty cannot be avoided. Therefore, a second backup control or a different primary data source needs to be established. The reasons for the uncertainties are the lack of controls of such reporting and the manifold opportunities to source bunkers outside the IMO MARPOL control. For example, off-shore bunkering and thus the utilization of extraterritorial activities which are difficult to monitor remains common practice. Vessel masters may omit bunker amounts due to poor management or deliberately in order to avoid costs. Marine heavy fuel oil (HFO) may be sourced from stocks that were produced as other heating oil products and may thus circumvent marine bunkering reporting mechanisms. Furthermore, the reliability of BFDN has been questioned by industry representatives due to possibilities of corrup-tion and falsificacorrup-tion31. As a consequence, a risk of mismatching marine fuel consump-tion and BFDN amounts might persist in the future.
31 Personal communications with ocean carriers, fall 2009.
The amount of bunker fuels produced today is determined by refining economics32 and not primarily by the demand side. What is being sold in marine bunker markets is re-sidual fuel as a secondary recycling product from refining where the cost benefit analy-sis does not result in further refining (EC 2002). Thus, marine heavy fuel oils are not deliberately produced. The available refining ‘by-product’ will seek the most profitable market; for example low land-based demand may lead to additional capacities sold on the marine market.
The most plausible primary data source or secondary control is excerpts of the vessels’
log-books. Each vessel is maintaining a log-book for its own management and to prove the compliance with manifold international and national rules and standards. Modern and large commercial vessels today operate with electronic log-books, often combined with sophisticated fuel and engine monitoring (see for example products by Kongsberg Maritime AS: http://www.km.kongsberg.com/). Older and smaller vessels maintain log-books manually. The measured or estimated fuel consumptions make up one entry in marine log-books for vessel management. Besides fuel data, other data is available on board vessels, in particular data on ports visited, cargo loaded and distances sailed.
Both port data and cargo data could easily be verified – in the case of suspicion of falsi-fication – by contacting port authorities or customs agencies. In conclusion, the data on fuel consumed and purchased is available on board ships and can be verified with data on distances sailed and ports visited. The question is whether a disclosure of log-book data could be made mandatory.
The US Coast Guard mandatory reporting requirement for ballast water management provides a precedence that mandatory reporting of existing data is legally possible. On June 14, 2004, the US Coast Guard published regulations on its mandatory ballast wa-ter management and reporting. A failure to comply may result in a daily fine of US
$US $ 27 500. The reporting includes detailed information on the locations of the bal-last water management practices of the vessel, its bal-last and arriving port as well as where it took up, exchanged and discharged ballast water (http://invasions.si.edu/nbic/forms/NBICReportingForm.pdf) (see also Annex 4). It is therefore an example of the national state enforcing a reporting requirement that stretches into the extraterritorial voyage of a vessel.
32 Heavy fuel oil is a residual co-product after atmospheric distillation. The refining process is designed to maximize the yields from valuable products – namely distillate fuels. Thus, the amount of heavy fuel oil that enters the market depends directly on the cost of further refining those oils and the supply and demand balances in the residual and distillate segments. As an example: today’s marine HFO prices are below crude oil prices (Prices on 26.07.2009: crude oil (Brent) = 485 US$/t; HFO380 Rotterdam = 400US$/t; HFO380 Singapore = 440 US$/t). The marine bunker prices are further determined by the gas and coal prices for land-based power plants, because heating oil – the dominant heating oil mar-ket – has to compete with those competitive fuel types. In tendency, the demand for heavy fuel oil is declining, that for distillate fuels increasing. Thus a continuous price down-ward pressure for HFO ex-ists.
The EC could establish a mandatory reporting scheme that requires vessels on voy-ages to any European port to report – at least once per period – the fuel consumed. In order to verify information, the reporting should mandate:
Amount of fuel uptakes (e.g. BFDN)
Location of fuel uptakes (e.g. BFDN)
Date of fuel uptake (e.g. BFDN)
Carbon content of fuel uptake (measured – or by choosing default values)
List of visited ports (via log-book entries)
Distances travelled between ports (via log-book entries)
Fuel consumed per distance travelled [t/nm] and while in ports [t/24h] (via log-book entries)
The reporting could be established electronically, via fax or paper and associated with a fine for non-reporting – similar to the procedures established by the US Coast Guard for ballast water reporting.