International Maritime Organization Sets 2020 Date for Ships to Comply with Low Sulphur Fuel Oil Requirement

1st January 2020 has been set as the implementation date for a significant reduction in the sulphur content of the fuel oil used by ships. This decision has been made by the IMO (International Maritime Organization) to protect both the environment and human health.

The decision to implement a global sulphur limit of 0.50% m/m (mass/mass) in 2020 was taken by the IMO during its Marine Environment Protection Committee, meeting in London.

It represents a significant cut from the 3.5% m/m global limit currently in place and demonstrates a clear commitment by IMO to ensuring shipping meets its environmental obligations.

IMO Secretary-General Kitack Lim welcomed the decision which he said reflected the Organization’s determination to ensure that international shipping remains the most environmentally sound mode of transport.

“The reductions in sulphur oxide emissions resulting from the lower global sulphur limit are expected to have a significant beneficial impact on the environment and on human health, particularly that of people living in port cities and coastal communities, beyond the existing emission control areas,” Mr. Lim said.

Under the new global limit, ships will have to use fuel oil on board with a sulphur content of no more than 0.50% m/m, against the current limit of 3.50%, which has been in effect since 1 January 2012. The interpretation of “fuel oil used on board” includes use in main and auxiliary engines and boilers. Exemptions are provided for situations involving the safety of the ship or saving life at sea, or if a ship or its equipment is damaged.

Ships can meet the requirement by using low-sulphur compliant fuel oil. An increasing number of ships are also using gas as a fuel as when ignited it leads to negligible sulphur oxide emissions. This has been recognised in the development by IMO of the International Code for Ships using Gases and other Low Flashpoint Fuels (the IGF Code), which was adopted in 2015. Another alternative fuel is methanol which is being used on some short sea services.

Ships may also meet the SOx emission requirements by using approved equivalent methods, such as exhaust gas cleaning systems or “scrubbers”, which “clean” the emissions before they are released into the atmosphere. In this case, the equivalent arrangement must be approved by the ship’s Administration (the flag State).

It is expected that steamship lines will announce price increases of between 20-30% over the coming 12 months in order to cover the investments required for compliance with the new regulations.

This additional cost will obviously impact companies moving goods via ocean considerably. Horizon International has developed robust long-term partnerships with all major shipping lines and will always seek to mitigate the impact of the expected increases on behalf of our clients.

Should you have any concerns or questions regarding the above, please do not hesitate to contact our team.