European Marine Engineering Conference 2016 supplement

European Marine Engineering conference | awards | exhibition

2016

“The development of the engines is forced by the market and that is driven by fuel prices.” Kjeld Aabo, MAN Diesel & Turbo

Celebrating the best

of marine engineering

The European Marine Engineering Conference took place on 13-14 April in Amsterdam and was, by

common consensus, a great success. Riviera Maritime Media has been

running a Conference in London under the Marine Propulsion banner for a number of years now. This year, however, we felt it was time to make a change. With that in mind we changed the name of the event to reflect its broader technological focus and moved it to Amsterdam to make it more accessible to a new audience.

As organisers, we were well aware that changes such as this bring with them attendant risks. Any alteration from the familiar is going to suit some better than others. However, we were delighted with the response to this change, which brought

with it a host of new faces to complement those who have been attending the Marine Propulsion Conference for years.

The new name and location were far from being the only innovations launched at this year’s event. Also new was The Doug Woodyard Memorial Debate, which took place at the close of Day Two and dealt with the thorny topic ‘This Conference believes it does not pay to install green technology’, a report on which is also contained within this supplement.

Another innovation was the survey undertaken by Marine Propulsion magazine in conjunction with ExxonMobil, which looked at some of the ‘hot button’ issues facing the industry at the moment.

The findings of this survey were used to inform the content throughout the Conference, but in particular they

were revealed at the beginning of the Conference by me in my capacity as editor of Marine Propulsion.

These findings threw up some interesting results in a number of areas. Perhaps the best place to start with these is with the answers to the question ‘How confident are you of the prospects for your sector in 2016? Here, 32 per cent of respondents replied that they were ‘Not confident’, which was perhaps surprising only insofar as one might have forgiven a greater degree of scepticism after the vicissitudes of 2015 and early 2016.

Next, respondents were asked ‘How would you assess your understanding of current marine regulations?’ Here 59 per cent described their understanding of regulations as ‘Good’ or ‘Very good’, but this still left the remainder who saw their knowledge as being

New faces and facets for the European Marine Engineering Conference Paul Fanning, Editor, Marine Propulsion

CONTENTS

ENGINES FORUM Emissions and alternative fuels dominate discussion

EXHIBITION Delegates took advantage of an exhibition highlighting some of the latest in marine engineering technology

MARINE PROPULSION AWARDS 2016 Innovators honoured on prestigious night

FUELS, LUBES & EMISSIONSSessions reveal a mixed picture

European Marine Engineering Conference supplement 2016 marinepropulsionconference.com

no better than poor to middling. Indeed, a fairly significant 26 per cent described their knowledge as ‘Poor’ or ‘Very Poor’.

‘How would you assess your company's readiness to deal with forthcoming regulation?’ again produced some interesting responses, with 49 per cent replying ‘Good’ or ‘Very Good’. Again, however, this left a significant remainder who were less confident and a very worrying 25 per cent who described their company’s readiness as ‘Poor’.

On the subject of ECA compliance, only 27 per cent reported any compatibility issues with ECA fuels, while 14 per cent said they had had issues with compliance.

The bunker industry came in for some criticism in the survey because, while the majority of respondents believed the industry to be reasonably trustworthy overall, they also said they believed certain bunker practices to be alarmingly widespread. Indeed, 39 per cent described short deliveries as a prevalent practice, 24 per cent forged bunker notes, another 24 per cent fuel adulteration and a genuinely alarming 50 per cent said they believe off-spec fuel deliveries to be prevalent.

Other interesting findings from the survey included the response to the question ‘What is the single most significant difficulty your business will face in 2016?’ Here, perhaps unsurprisingly, the price of oil was rated as the biggest issue by 29 per cent, with low charter rates making up a further 27 per cent. The next most significant issue was the administrative burden imposed by regulation.

Questioned as to whether any of their ships had suffered a serious mechanical

failure in the last 24 months, 49 per cent of respondents said ‘Yes’, while a further 39 per cent said their ships had in the past suffered a mechanical failure due to misapplication of lubricant.

Asked which components generally caused the greatest problems when it came to reliability, 28 per cent cited pumps as the greatest villains, while 22 per cent opted for turbochargers and 20 per cent seals and bearings.

Finally, when asked ‘How well do you believe the IMO represents the interests of shipowners?’, a mere 19 per cent answered ‘well’ or ‘well’, 40 per cent said

‘Adequately’, while 42 per cent suggested ‘Not well’ or ‘Poorly’.

These were not the only questions asked in the survey, but these convey some idea of the thoughts of our readers and really helped to inform the Conference as a whole. Certainly it is our intention to continue with the use of such surveys in future.

When we launched the European Marine Engineering Conference, it was our intention to deliver a valuable, informative, must-attend event for our industry. We believe we did so and hope that this supplement gives a flavour to those who were not there of what they missed. MP

WHAT IS THE SINGLE MOST SIGNIFICANT DIFFICULTY YOUR BUSINESS WILL FACE IN 2016?

Price of oil

Low charter rates

Admin burden to comply with regulations

Recruitment of competent staff

Other

Capital investment

Cost of fuel

29%

27%14%

11%

9%

9% 1%

RISK MANAGEMENTHow to manage engineering systems to best effect

LIFETIME ACHIEVEMENT AWARD WINNERNikolaos Kyrtatos’ Herculean contribution to marine engineering

DEBATEHeated marine engineering debate demystifies the ‘green haze’

Published May 2016

Editor: Paul Fanningt: +44 20 8370 1737e: [email protected]

Sales Manager: Rob Gore t: +44 20 8370 7007e: [email protected]

Group Production Manager: Mark Lukmanjit: +44 20 8370 7019e: [email protected]

Published by:Riviera Maritime Media LtdMitre House 66 Abbey RoadEnfield EN1 2QN UK

www.rivieramm.com

©2016 Riviera Maritime Media Ltd


marinepropulsionconference.com European Marine Engineering Conference supplement 2016

4 | ENGINES

ENGINES FORUM FOCUSES ON EMISSIONS AND ALTERNATIVE FUELS

T he Engines Forum of the European Marine Engineering Conference was divided into two parts, the first covering low-speed engines and the second medium- and high-speed engines.

Chairing both sessions was Ioannis Vlaskos, global market sector director – marine, director - engines business

unit, Ricardo Germany, who spoke about the need for engine manufacturers to offer end users flexibility in order to help meet emissions targets. He said: “A few years ago, we thought the oil price would stay high and so invested in gas. Clearly this has not turned out to be the case. This shows us the importance of remaining flexible – unfortunately nobody has a crystal ball.”

First to speak was MAN Diesel & Turbo head of marine and offshore sales, Kjeld Aabo, who looked at the achievements and challenges in the field of low-speed engines, highlighting the growth in MAN’s GI and LGI product ranges. In fact, he confirmed

that 10 per cent of MAN’s order backlog are GI-type engines, but nonetheless he said: “Fuel oil will still be a huge part of marine fuel demand in 2040”. Certainly, he made clear, MAN’s G-series low-speed engines continue to dominate the order book

In addition, Mr Aabo outlined MAN’s belief that the market this year and next will continue to be slow, as well as revealing that the company only had 31 orders for Tier III equipment at the moment – a figure he said: “we would expect that to be much higher”.

Naozumi Jimichi deputy general manager, Mitsubishi Heavy Industries Europe spoke next, outlining his company’s use of low-pressure EGR systems to meet NOx Tier III emission regulations and highlighting the Mitsubishi UEC50LSH-Eco-C2 engine, the first of which was delivered in March 2015.

The final presentation in the low-speed session went to Winterthur Gas & Diesel general manager business and application development, Rudolf Holtbecker discussing the company's future two-stroke propulsion concepts for meeting emissions regulations.

During his presentation, Mr Holtbecker conceded that the


ENGINES | 5

company’s development of its the Wärtsilä brand X-DF low-speed two-stroke engines for LNG operation had been predicated on high fuel prices and the desire to cut fuel consumption and that the unpredictable fuel price outlook had not been foreseen. However, he said: “Nobody thinks fuel costs will stay low – high efficiency will remain the dominant factor.”

Following the presentations, panellists were asked about the extent to which their product development strategies had been influenced by high oil prices and whether, with hindsight, they would have opted for another course had they known prices would fall so far. To which Kjeld Aabo answered: “The development of the engines is forced by the market and that is driven by fuel prices – that is just a fact.”

Attention then moved to the medium-high speed engine sector. Kjeld Aabo also featured on this panel also, but was preceded by Leif-Arne Skarbo, chief engineer technology and safety for Bergen Engines, who talked about his company’s pioneering work in the development of lean-burn pure gas engines and the complexity of modern medium-speed and high-speed engines.

While he conceded that “We cannot say goodbye to HFO – there’s still good business in it for many years”, Mr Skarbo pointed to the “clear successes” in lean burn pure gas engines, particularly in offshore support vessels such as M/S Stavangerfjord where, as he put it: “They have achieved a level of efficiency that previously would only have been found in a big two-stroke engines.”

Mr Skarbo also praised the advent of the ‘big data’ era, in which engine data can now be rapidly and thoroughly analysed. Previously, this was made impossible by limitations in computing power, but, says Mr Skarbo: “This is no longer an issue, it really isn’t. It’s giving us a huge amount of opportunitiy.

Kjeld Aabo discussed MAN’s four-stroke Holeby Gensets, as well as outlining the advantages of MAN’s modular SCR System Concept for its entire four-stroke engine portfolio. He also made

the point that the company’s figures indicate that people are tending to stick with older, more established engine types in this area rather than investing in the latest versions and suggested that perhaps the greater complexity of modern engines was actually proving problematic and even off-putting for end users.

Ulf Alfstrand product development programs director, Wärtsilä Marine Solutions then discussed the Wärtsilä 31 engine, which it bills as the most efficient of its type in the world. He conceded that it, too, had been designed for a world of high oil prices, but said: “It’s not just about fuel price, it’s about efficiency” and pointed out that it was extremely risky to make long term business decisions based on current boundary conditions.

He then went on to say that this would be the age not just of duel fuel, but of ‘multi-fuel’ engines, saying: “DF and multi-fuel capability ensure the maximum possible level of fuel flexibility.” MP

FAR LEFT: The low speed engines panel featured all of the key engine manufacturers in this sector

LEFT: Kjeld Aabo, MAN Diesel & Turbo: “The development of the engines is forced by the market and that is driven by fuel prices – that is just a fact.”

BELOW: The medium to high speed panel looked at issues such as fuelling, big data and emissions reduction


6 | FUELS, LUBES AND EMISSIONS

Fuels, lubes and emissions sessions reveal a mixed picture

On the afternoon of the first day of the European Marine Engineering

Conference, the focus turned first to fuels.

To begin this session, Armelle Breneol of ExxonMobil offered her company’s ‘Outlook for Energy’. This offered a view to 2040 by which time, she predicted that global fuel demand would have grown by 40 per cent, with the marine and aerospace sectors making up to a third of this increase. She also foresaw a decrease in slow steaming and that oil would remain the world’s primary fuel through 2040, but that natural gas would grow its share of the market more than any other fuel.

The next speaker in the fuels session was Peter Hall, chairman of the International Bunker Industry Association, who addressed the changing face of marine fuel supply, highlighting the issues caused by uncertainty over the timing of the next global sulphur cap. He asserted that compliance was largely being achieved by the use of distillate at the moment, with the take-up of alternative fuels remaining relatively low.

In terms of enforcement, he suggested that as many as 10 per cent of vessels calling at EU ports were being tested, with very high levels of compliance. In terms of the decision on a

0.5 per cent global sulphur cap, he suggested that “the speed of change will be dictated by policy changes and market forces”, while the use of new fuels would very much be affected by supply and infrastructure.

Picking up on this latter point, Society for Gas as a Marine Fuel chairman Mark Bell looked at the prospects for LNG’s more widespread adoption. He said that there was a increasingly mixed fuel usage, but conceded that the low oil price had slowed progress in this area somewhat. On this point, he did note, however, that: “Partial eclipses do not last forever”.

The lubes panel started with a keynote by Jens Byrgesen of Maersk Fluid Technology, who outlined the company’s blending-on-board (BoB) technology. This was then followed by presentations by representatives of ExxonMobil, Castrol, Total Lubmarine, Chevron Lubricants, Shell Global Solutions and Lukoil Marine Lubricants. Here, the most pressing issue addressed was cold corrosion, while Lukoil also examined the issues associated with blending-on-board.

The day’s schedule ended with the Emissions session, where Basjan Faber of C-Job Naval Architects and Erik Kemink of PitPoint looked at the applications of biogas, while Simon Brown of WR Systems and Pokka Pohjanen discussed scrubber technology. MP

Peter Hall, chairman, IBIA: “The speed of change will be dictated by policy changes and market forces”

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ExhibitionDuring breaks in the Conference, delegates also had the opportunity to take advantage of an exhibition highlighting some of the latest in marine engineering technology

R unning alongside the European Marine Engineering Conference 2016 was the exhibition, in which a range of manufacturers and service providers

were available to talk to delegates about their offerings and expertise.

As ever, this exhibition gave delegates an opportunity to speak in depth about some of the latest technologies available and to put some of the discussions that took place in the Conference into context – as well as giving colleagues and acquaintances a chance to catch up and talk business.

Exhibiting at 2016’s event were:• Ricardo• Sims Pump Valve• VAF Instruments• Wärtsilä Seals & Bearings• MIRUS International • Eaton • Klüber Lubrication • Kloska Group • Spurs Marine Mfg • MAN Diesel & Turbo • Thordon Bearings.


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Innovators honoured by Marine Propulsion Awards Six products, two individuals and a ship were all honoured at the European Marine Engineering Awards dinner. Trophies supported by Marine Propulsion magazine recognised innovation across a range of technologies, and were presented to winners at the event which took place in Amsterdam at the end of the first day of the European Marine Engineering conference.

Chairman of the judges, the secretary general of the International Association of Classification Societies, Robert Ashdown, said that the scheme shared two features that marked it out as one of the best award programmes: high quality entries from around the globe and an impartial judging panel that is closely involved in the industry. Over the next few pages is the rundown of the winners and nominees.


ELECTRICAL SYSTEMS AWARD

Mirus International, for its MOS Lineator. The MOS Lineator guarantees full compliance with class society harmonic voltage limits without introducing high frequency harmonics.Also nominated: Corvus Energy, Mirus International and Zem

RIGHT: Tony Hoevenaars of Mirus International accepts the Electrical Systems Award

ENVIRONMENTAL PERFORMANCE AWARD

I-Tech, for its Selektope Biocide. Selektope Biocide uses a pharmacological mode of action to combat barnacle settlement on ship hulls. It is effective in minute quantities.Also nominated: SetelHellas and Stena Line

ABOVE: Philippe Chabaane of I-Tech accepts the Environmental Award for Selektope Biocide

FUEL EFFICIENCY AWARDSchottel, for its EcoPeller. The EcoPeller is a highly efficient thruster optimised for open sea and coastal operating conditions. Innovations include fewer gears than a Z-drive unit and the patented high torque gear design.Also nominated: Corvus Energy, Norsepower

LEFT: Rolf Hendriksma, sales manager of Schottel accepts the Fuel Efficiency Award for the EcoPeller

AUXILIARY MACHINERY AWARDABB, for its Azipod D. Azipod D is the new member of ABB’s gearless thruster family. It features hybrid cooling, which allows a very high output torque and gives improved hydrodynamic efficiency. The electric motor performance is increased up to 45 per cent.Also nominated: Thordon Bearings and Wärtsilä Seals & Bearings

ABOVE: ABB‘s Auxiliary Machinery Award for the Azipod D takes pride of place in the reception area of its Helsinki building


AWARDS | 13

INNOVATION AWARDNSB Group/Reederei, for its ship widening system. Reederei NSB has patented a concept to widen a ship cutting it into four pieces to enlarge it, increasing its capacity and stability.Also nominated: ExxonMobil; Parker Kittiwake

ABOVE: Markus Thewes of NSB Marine Solutions receives the Innovation Award

LIFETIME ACHIEVEMENT AWARDLEFT: Prof Nikolaos Kyrtatos, of the National Technical University of Athens. Among many achievements are his co-ordination of the EU’s ‘Hercules’ efficient engine research programme and his work as director of the university’s Laboratory of Marine Engineering, which was designated as a centre of excellence in ship energy, emissions and economy by Lloyd’s Register’s Educational Trust in 2010 and rated as “among the best in the world” in the university’s 2012 external evaluation report.

MARINE ENGINES AWARDWärtsilä, for its Wärtsilä 31 Engine. The Wärtsilä 31 holds the Guinness World Records title for the most efficient four-stroke diesel engine. Operators can use different qualities of fuels, from very light to very heavy diesel, and a range of qualities of gas.Also nominated: CR Ocean Engineering, GE Transportation Marine

BELOW: Ulf Astrand of Wärtsilä with the Marine Engines Award

SHIP OF THE YEAR AWARDStena Line, for Stena Germanica’s methanol-fuelling retrofit. The objective of Stena’s methanol pilot project was to develop a pragmatic, cost effective and green fuel option.Also nominated: Eletson Corp’s Othoni, Höegh Autoliners’ Höegh Target

ABOVE: Per Stefenson, Marine Standards Advisor at Stena, receives the Ship of the Year Award

GRADUATE RESEARCH AWARD (NEW THIS YEAR)

Arne Good, of Antwerp Maritime Academy, for his Solar Boat project. His goal was to explore hull design and efficient electronics to develop an efficient hull and electric propulsion.Also nominated: Dr Sunghan Kim; Dr Ibna Zaman

RIGHT: Arne Good, of Antwerp Maritime Academy accepts the Graduate Research Award for his Solar Boat project


Nikolaos Kyrtatos A Herculean contribution to marine engineering

The European Marine Engineering Conference’s Lifetime Achievement Award Winner, Prof Nikolaos Kyrtatos, reflects on the pioneering multi-million, multi-faceted Hercules project he has steered since 2004

T he EU’s High efficiency Engine Research in Combustion with Ultra Low Emissions for Ships - or ‘Hercules’ – project was conceived in 2002 as a long-term R&D Programme, to develop new technologies for marine engines. Its budget has

surpassed the €100 million mark and the project is now in its 12th year and will run for a further four.

To get a project of that size running takes a bit of planning and there are two basic ingredients: funding and a team that is both willing and up to the task. Funding is the more important and more time consuming part and no funding agency will give away money.Rather what's being proposed has to mesh with its programme of activity. And its programme is not drafted by the funding agency... but from a higher authority - which is probably political and therefore influenced by the public and reliant on the advice of small expert groups. Convincing the funding agency that your project is a good fit takes the best part of five years.

The other aspect, that is bringing the team together takes more social engineering than anything else. It requires competitors to work together. And at first this may prove quite difficult – and in this particular case it has taken more than two years to persuade the companies – MAN and Wärtsilä – to work together. Here other things come into play, like curiosity – or what the other side is

doing – and pride – what we can do and you cannot.From here one then takes a completely top down approach to

inviting third party collaborator to join the various groups that are doing the project. The very best get invited first.

Hercules is now in its fourth term and the project and how it’s resources have been allocated, have been guided by three basic – even abstract – goals. Improving engine efficiency, reducing engine emissions and improving engine reliability.

Initially 60 per cent of the money was funnelled into efficiency projects and now these projects only account for 20 per cent. There are two reasons: we are reaching the limits of what is possible in terms of efficiency for these engines. And it is becoming more and more expensive to go further in this area. Emissions commanded one third of the budget and now is nearing 50 per cent. This is because coming legislation makes this a priority area. Our spending on projects centred on engine reliability has mushroomed from 10 per cent in 2004 to about a third today. Users’ expectations of engine reliability have grown so our allocation has grown in proportion.

Looking far beyond Hercules, the next generation of engines will be able to somehow assess their own performance and maybe improve it. And even further into the future we will see 'the self-healing engine'. MP


“THERE ARE TWO BASIC INGREDIENTS: FUNDING AND A TEAM THAT IS BOTH WILLING AND UP TO THE TASK” Nikolaos Kyrtatos

CAREER HIGHLIGHTS • More than 70 publications and over

150 technical reports to his name.

• Principal Investigator in more than 40 research projects.

• Past-president of CIMAC – The International Council on Combustion Engines

• Professor of Marine Engineering in the School of Naval Architecture and Marine Engineering at the National Technical University of Athens, since 1984

• Director of the university’s Laboratory of Marine Engineering since 2001, rated as “among best in the world”


16 | RISK MANAGEMENT

MANAGING SYSTEMS AND RISK TO BEST EFFECTRISK MANAGEMENT, THE OWNER/OPERATOR VIEW AND ADVANCES IN TECHNOLOGY CAME UNDER THE SPOTLIGHT AT EUROPEAN MARINE ENGINEERING CONFERENCE

I nsights into mitigating the risk of fuel related engine damage and fuel handling issues were shared by Brookes

Bell’s Duncan Tanner in day two’s risk mitigation session. In a comprehensive address Mr Tanner covered: fuel purchasing and charter party clauses; delivery procedures; storage; onboard treatment and monitoring; engine performance monitoring; mitigation and claims handling.

Kittiwake’s Larry Rumbol made the case for condition monitoring. Only 10 per cent of the global fleet has presently adopted it, despite the low cost and considerable benefit, he said. ABS’ George Reilly was candid about the risks presented by cyber-enabled systems. “There is no turning the clock back on automation in marine systems,” he explained.

Ballast water treatment regulation dominated discussions in the owner/

operator forum. CMB / Bocimar’s Lieven Van Eetvelde emphasised the need for a customised approach to ballast water treatment technology selection. “If selecting a chemical based system be clear on who will pay for the chemicals.”

He was joined in these discussions by Reederei NSB’s Jörg Erdtmann; Novoship’s Evgeny Kostyuk; and Maersk Maritime Technology’s Palle Wredstrom.

The equipment forum began where the operator’s left off. Evoqua Water Technologies’s Lars Nupnau advised owners to makes use of their ballast systems ‘the 95 per cent of the time the ship is not ballasting’. “This saves on crew maintenance, fuel – due to better heat exchange in the engine cooling system – and eliminates the cost of replacing expensive copper aluminum sacrificial anodes.”

Discussions broadened

to take in GE Transportation’s latest engine courtesy of Rob Van Solingen before circling back to fuel quality. GEA Westfalia’s Martin den Hartog referred to cat fines as ‘the silent threat’. The key when using a separator, he said, was to use a variable flow rate and separate the fuel at 110C.

A specialist in turbochargers, MAN Diesel & Turbo’s Kemal Oguz Coban, shared a range of condition based maintenance tips: “Bearing renewal,” he said, “should ideally be carried out as part of the system’s second major overhaul.”

Wärtsilä Seals & Bearings’ Tim Biswell spoke on water lubricated propeller shaft systems. “Classification Society notations are permitting extended tail shaft withdrawal periods for water lubricated systems,” he said, adding: “water lubricated systems reduce operation risk and offer lower through life costs.” MP

ABOVE: A lighter moment during the owner/operator panel


8-9 November 2016, Singapore

Providing information on the latest developments in marine engines, auxiliary equipment, fuels, lube oils and turbochargers

With over 50 per cent of the world fleet owned or operated in Asia and 85 per cent of global shipbuilding capacity, the Asian maritime industry plays a vital role in influencing the development of technologies in the marine sector. The 2016 Asian Marine Engineering Conference will focus on the operational challenges of Asian shipowners and how technology can help improve efficiency and profitability in the current challenging environment.

To find out more or to book your place today visit www.marineengineeringasia.com or contact Kym Tan on +65 6809 3098 or at [email protected]

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DEBATE | 19

Heated marine engineering debate demystifies the ‘green haze’

Delegates at this year's European Marine Engineering Conference in Amsterdam heard that they were being held to ransom by ‘green zealots’ enveloped in a ‘green haze’ who were imposing meaningless regulation on the industry with no sense of cost.

“THE REAL SOURCE, HE ASSERTED, WAS COAL-FIRED POWER STATIONS IN RUSSIA AND CHINA “BUT IT'S NOT POLITICALLY CORRECT TO SAY THAT”

MOTION: THIS CONFERENCE BELIEVES IT DOES NOT PAY TO INSTALL GREEN TECHNOLOGIES.

Proposer (for the motion)Capt Herbert, Chief Commercial Officer, Misuga Holland

Proposer (against the motion)Mark Cameron, Executive Vice President and COO, Ardmore Shipping Corporation

Seconder (for the motion)David Tongue, Secretary-General, Intercargo

Seconder (against the motion)Poul Woodall, Director, Environment & Sustainability, DFDS

ChairEdwin Lampert, Group Managing Editor, Riviera Maritime Media

Speaking at the inaugural Doug Woodyard Memorial Debate, Intercargo secretary general David

Tongue, speaking in favour of the motion – This conference believes it does not pay to install green technologies – said that the industry was “an easy target for politicians looking to further their career aspirations” and “something needs to be done”. He gave numerous examples in support of his case including an assertion that even the green lobby conceded that should every ship be removed from the Arctic it would have no impact on that region’s black carbon problem. The real source, he asserted, was coal-fired power stations in Russia and China “but it's not

politically correct to say that”. He also targeted the ballast water management convention “introduced on Friday 13th, twelve years ago – something we should have seen as a sign even then”. He pointed out that not only had it not entered into force, but this “convention from hell” was seriously flawed. Intended to deal with the translocation of species from one part of the world to another, it failed to take into account that there are three other vectors that species can move: via hull bio-fouling; aquaculture; and natural translocation.

The industry is plagued by ‘aspirational politicians’ pedalling personal agendas with no regard for the shipping industry, he added. “The mayor of New York banned the overboard discharge of grey water so he could turn to his constituents and assert he had ‘dealt with the problem.’ He later admitted that he put that measure in place because shipping had no impact on the financial state of New York.”

Also speaking in favour of the motion was the erudite Captain Herbert Soames, chief commercial officer, Misuga Holland. He looked at the commercial angle, implied by the word ‘pay’ in the motion.

“Charterers do not and have never paid

marinepropulsionconference.com

for incremental technological advancements. A two-tier market has almost never existed,” he said. “Mainstream financing is not available for green technologies. Although many reasons lie behind this, one stumbling block is that it is difficult to quantify the savings such technologies bring. In recent years there has not been a major technological breakthrough that has radically improved efficiency.”

Capt Soames added: “Last year during the Danish Maritime Days event, KfW Ipex bank’s head of shipping, Carsten Weber, said during that event’s environmental forum that KFW had financed only one green technology deal: the retrofitting of 40 propellers. “And that could only happen because the propellers were going to be made in Germany. They would get the support of German export finance and 90 per cent of the loan would

be guaranteed by the German government – so there was no risk. In order to finance green technologies you need external support. It cannot be self-standing, unfortunately, but that is the truth.

“While at DVB Bank from 2004 – 2014, I participated in the financing of roughly 3,000 ships. Financing and investment decisions are based on the bank being sure that it will get their money back which means that the assets will earn sufficient cash flow to return the money. A person can say: “I spoke to one bank and they financed three ships” but such deals only happen when an entity other than the bank – such as German Export Finance – takes the risk. If it's purely on the merits of the deal it will not happen. A bank might get involved if financing 20 ships for an owner. Here the bank will typically look to cross-finance

or cross collateralise the green technology investment.” Rounding out his argument, Capt Soames contrasted the outlook today with the industry mood of the mid-2000s when the buzz word was ‘peak-oil’ and “you couldn't open a shipping publication without some mention of eco-vessels”.

“Funded by private equity many shipowners were lured by the snakeoil appeal of eco vessels,” he argued. ‘Snake oil’ is the term which used to be used for fraudulent medical products and has since broadened to anything with questionable benefits. “My point is that just like peak oil, ecovessels’ charm has faded over time.”

Making the case that green technologies do pay, Ardmore Shipping chief operating officer Mark Cameron said that while present low oil prices did not favour investments in green technologies “you cannot walk past the

20 | DEBATE

CLOCKWISE FROM TOP LEFTPoul Woodall (DFDS): “We need to define what pay really means”Herbert Soanes (Misuga): “Charterers do not and have never paid for incremental technological advancements” David Tongue (Intercargo): “The industry is plagued by ‘aspirational politicians’” Mark Cameron (Ardmore): 20 per cent of charterers are selecting vessels based on [environmental] performance


“HE LATER ADMITTED THAT HE PUT THAT MEASURE IN PLACE BECAUSE SHIPPING HAD NO IMPACT ON THE FINANCIAL STATE OF NEW YORK.”

DEBATE | 21

PRE-DEBATE

12%agreed it did not pay to install green technologies

88% agreed it did pay to install green technologies

POST-DEBATE

31% agreed it did not pay to install green technologies

69%agreed it did pay to install green technologies

environmental debate”. He asserted that financing was opening up for new investments and that such investments were also deeply pragmatic. "Ask yourself – why do 20 per cent of charterers review the RightShip ship efficiency index, if they are not selecting vessels based on [environmental] performance? Did you know that two billion tonnes of cargo is now shipped by charterers using this index? In a bad market who has the more attractive ship?”

Picking up on Capt. Soane’s reference to KfW’s financing of a retrofit project he pointed out that the installation costs for retrofits remain at a direct correlation to fuel price. “Return on investment is therefore a somewhat spurious measure, as the variable fuel price is completely uncontrollable. In today's fuel price scenario, payback time is significantly extended, however the

environmental benefits associated with fuel savings is immediate and concrete.”

Concluding he said what would be really innovative would be to find ways to incentivise technology developers so that their return on investment is not unfairly skewed towards clawing back their research and development costs in the shortest possible time. “This would make the early adoption of technology much more palatable to owners who are faced with significant capital costs.”

Also speaking against the motion, DFDS director, environment and sustainability, Poul Woodall argued that those saying that green technologies did not pay were transfixed by history and needed to understand present and future realities as well as the moral imperative to go green. “We need to define what pay really means,” he asserted arguing that the

dividend from going green went beyond the purely financial. “Shipping is a great benefit to society and we create wealth,” he said. “But we can only continue to do that if we align with society, and that is why we have to invest in these technologies.”

Delegates were asked to vote on the motion before the debate, and then at its conclusion. In the first round 88 per cent agreed it did pay to install green technologies. In the second round this number reduced to 69 per cent. So while the motion did not carry, those arguing that green technologies do not pay clearly made powerful and persuasive arguments. MP

The Doug Woodyard debate was established in memory of late Marine Propulsion editor Doug Woodyard. Doug was universally respected for his deep knowledge of marine engineering and his informed and opinionated journalism.


Documents

European Marine Engineering Conference 2016 supplement