20120911 Shipping 2020

27 September 2012

“SHIPPING 2020”
TECHNOLOGY INVESTMENTS IN THE NEW MARKET REALITY

CONTENTS

WHY "Shipping 2020"

METHODOLOGY AND
ASSUMPTIONS

FINDINGS

BEYOND 2020

© Det Norske Veritas AS. All rights reserved. 2

1

27 September 2012

FINDINGS

"Shipping 2020" – Summary

More than 1 in 10 new buildings in the next 8 years will be delivered with gas
fuelled engines

In 2020, the demand for marine distillates could be as high as 200-250 million
tonnes annually

Newbuildings in 2020 will emit up to 10 to 35% less CO2 than today’s ships. The
EEDI will be a driver for more than half of this reduction

Scrubbers are a significant option after 2020

Ballast water treatment systems will be installed on at least half of the world fleet

At least 30-40% of newbuildings will be fitted with EGR or SCR by 2016


WHY
"Shipping
2020"


2

27 September 2012

WHY "SHIPPING 2020"

What is “Shipping 2020”?

QUESTION:
What technologies should be installed to meet
new environmental regulations and higher fuel
prices?

CHALLENGE:
Uncertainties associated with market trends
and drivers, fuel choices, technology
developments and other variables.
The wrong investment decisions
will be detrimental to both the industry
and individual ship owners.
Wrong decisions impact the financial bottom
line and the environment.

ANSWER:
"Shipping 2020" aims to indicate which
technologies are most likely to be adopted by the
industry by 2020.


WHY "SHIPPING 2020"

External drivers creates uncertainty about the future

World economy and demand for transport

Environmental regulations

Fuel trends (price, mix)


3

27 September 2012

FINDINGS

How does this affect the ship owner?

The next decade poses some important questions for the ship owner

When should I install ballast water treatment

? ??
systems?
Should I meet sulphur regulations through
investing in LNG fuelled engines or
scrubbers, or by fuel switch?

?
Do I need a NOx Tier III compliant vessel
enabling global operation?
What is my cost-benefit of going beyond
compliance on the EEDI?
?

METHODOLOGY
AND
ASSUMPTIONS


4

27 September 2012

METHODOLOGY AND ASSUMPTIONS

The process – the big picture

Scenario Scenario Scenario Scenario
A B C D

World economy
Environmental Fuel trends
and demand
regulations (price, mix)
for transport

Investment profile
Technology SIMULATION and ship
trends MODEL characteristics

RESULTS



Megatrends and external drivers

ECONOMIC GROWTH REGULATORY AND FUEL TRENDS
AND DEMAND FOR STAKEHOLDER
TRANSPORT PRESSURE

• Boom or bust? • Global or local • Sustained high fuel
• Growth level and regulations? prices?
level of contracting • Further requirements • LNG cheaper than
• Overcapacity of on GHG emissions? HFO?
vessels? • Rating schemes and • Development of LNG
requirements from infrastructure
charterer and public • Impact of sulphur
regulations


5

27 September 2012


Scenarios have been created to capture
uncertainties



Some of the assumptions used in the model


6

27 September 2012


Technologies have been assessed against
relevant regulations



Ship owner survey – motivation and barriers

Compliance and fuel efficiency are the main motivation, and cost and
technology maturity are the main barriers

Main motivation Main barriers

Source: DNV survey (23 respondents)


7

27 September 2012


Ship owner survey – investment preferences

Investment horizon (payback requirements) and how much of the fuel cost is
paid by the ship owner impact the cost-effectiveness of many measures




Which technologies do ship owners envisage
using in the future?
FIGURE 3: FAMILIARITY AND EXPERIENCE WITH TECHNOLOGIES FIGURE 4: LIKELIHOOD OF IMPLEMENTING TECHNOLOGIES

Low sulphur heavy fuel oil Ballast Water Treatment System
Distillate fuel Low sulphur heavy fuel oil
Shaft generators System efficiency improvement (Aux)
Ballast Water Treatment System Hull shape optimisation
Waste heat recovery Waste heat recovery
Propulsion efficiency devices Propulsion efficiency devices
Hull shape optimisation Distillate fuel
SOx scrubber EGR system
System efficiency improvement (Aux) Low NOx tuning
Smaller engine/de-rating (speed reduction) Shaft generators
Low NOx tuning Smaller engine/de-rating (speed reduction)
Reduction of seawater ballast capacity Reduction of seawater ballast capacity
EGR system SCR system
Counter-rotating propulsion SOx scrubber
Dual-fuel engine Lightweight constructions
SCR system Dual-fuel engine
Hybrid propulsion system Water emulsification
Pure LNG engine Humid air motor/ direct water injection
Water emulsification Hybrid propulsion system
Lightweight constructions Counter-rotating propulsion
Air cushion Pure LNG engine
Humid air motor/ direct water injection Air cushion
Wind & solar power Wind & solar power
1 2 3 4 5 1 2 3 4 5
Low Score High Low Score High
Familiarity with technology Likely to be retrofitted

Tested Likely to be implemented on new builds


8

27 September 2012


Time spent in ECA

Approximately 40% of the world fleet enters into the North America or
Northern Europe ECA during a year
Half of these vessels spend less than 5% of their time there
Time spent in ECA

Share of fleet
Source: AIS data



Model illustration : simulation of individual ships

Investment profile
and ship
Generate a characteristics
representative
sample of the Assign each ship a
current world fleet ship owner
investment profile

Technology
alternatives Technology cost Results
decreases with
more installations
Annual technology
and fuel type 2020
2019
2018
2017
2016
2015
2014
2013
2012
decisions per ship

Fuel price
and regulatory
requirements

Add newbuildings to
the fleet each year

Growth in seaborne
transport
Remove scrapped ships
from the fleet each year


9

27 September 2012


Assumptions and information sources
Parameter Distribution Scenario dependent Source
Ship segment
Number of ships Fixed No IHS Fairplay
Age distribution Parameterized No IHS Fairplay
ME power Fixed No IMO GHG Study
Aux power Fixed No IMO GHG Study
Nos of Aux Fixed No IMO GHG Study
Ballast water capacity Fixed No IHS Fairplay
Specific fuel consumption Fixed No MAN
Operational profile
Days in cruise Uniform No IMO GHG Study
Days in ECA Parameterized No AIS
ME engine cruise load Uniform No IMO GHG Study
Aux engine cruise load Fixed No IMO GHG Study
Ship owner
Investment horizon Parameterized Partly Survey
Discount rate Triangular No Internal forecast
Share of fuel paid Parameterized Partly Survey
Technologies
CapEx Uniform No Manufacturers
OpEx Fixed No Manufacturers
Fuel reduction ME Fixed No Manufacturers
Fuel reduction Aux Fixed No Manufacturers
Learning rate Uniform No IEA/others
External variables
Fuel prices Stochastic Yes IEA/EIA/Clarkson
Fleet growth Fixed Yes IHS/SAI
CO2 prices Fixed Yes Internal forecast
Regulatory requirements Deterministic Yes Internal forecast



Fleet used in the simulation model

In total 48,400 ships in 2011 comprising the international trading fleet except
passenger ships and ferries

© Det Norske Veritas AS. All rights reserved.

10

27 September 2012

FINDINGS


FINDINGS

Finding 1

More than 1 in 10 new buildings in the next 8 years will be delivered with gas
fuelled engines
LNG price, sulphur limits and EEDI are the
main drivers

From 2012-2019 the LNG price is the main Share of LNG fuelled newbuildings
contributing factor Scenario D

When approaching 2020, EEDI and sulphur
limits will create additional motivation for
LNG as fuel
- In Scenario D, 35% of newbuildings will be
delivered with LNG engines

In scenario D, we foresee about 1,000
newbuildings from 2012-2020 and some 6-
700 retrofits


11

27 September 2012

FINDINGS

Finding 2

In 2020, the demand for marine distillates could be as high as 200-250 million
tonnes annually
A 0.1% limit in ECAs (2015) is expected to
increase the demand to 45 million tonnes Fuel mix in 2020

- The current annual global demand for marine
distillates is about 30 million tonnes

With a global sulphur limit HFO demand
may drop from 300-350 million tonnes to
only 80-110 million tonnes in 2020
- Depends on the number of scrubbers in use
- The use of LNG will not significantly impact the
demand of other fuels
- Energy efficiency measure will only slow the fuel
demand in the short term


FINDINGS

Finding 3

Newbuildings in 2020 will emit up to 10 to 35% less CO2 than today’s ships.
The EEDI will be a driver for more than half of this reduction
Phase 0 of EEDI (2013) will encourage CO2 emission reduction on newbuildings
cost-effective measures
In Phase 1 (2015) and 2 (2020), up to half
the reductions are motivated by EEDI
alone
- Due to short investment horizon and low fuel
burden, these reductions are not cost effective
for the ship owner EEDI reduction on newbuildings
- But in the long-term these are cost-effective

Small differences between scenarios
- Fuel prices are already so high that any
variation does not affect uptake

Operational measures not included


12

27 September 2012

FINDINGS

Finding 4

Scrubbers are a significant option after 2020

Few ships spend more than 30% of their Ship owner investment profile
time in and ECA justifying a scrubber
before 2020
In 2020, with the global sulphur
requirements, scrubbers become a
significant solution
- Scrubbers can be retrofitted and can take 25% SOx reduction options in 2020
of the market, 15-20,000 ship
- Still, 70% of ships will run on distillates
- In the short term LNG can only take a small part
of the market

Uncertainty about the 2020 limit will slow
technology development and uptake


FINDINGS

Finding 5

Ballast water treatment systems will be installed on at least half of
the world fleet
The Ballast Water Management
Convention has not yet entered into force, Annual expected ballast water
but treatment installations
- The schedule for mandatory treatment of BW
is fixed (2019)
- The US has decided to implement a similar
scheme for all ships in US waters (2013)
- Other countries have local requirements
This will motivate a significant part of the
world fleet to implement a treatment
system irrespective of BWMC progress


13

27 September 2012

FINDINGS

Finding 6

At least 30-40% of newbuildings will be fitted with EGR or SCR by 2016

Both EGR and SCR are currently under
development and need more time to NOx treatment installations
mature
LNG is an alternative but does not seem
to replace more than 25% of EGR or SCR
installations
- Dependent on LNG price

Will a ship owner will opt for a Tier III
engine even if the ship is initially not
planned for sailing in an ECA?
- Lower second-hand value due to the loss of
geographic flexibility


FINDINGS

Sensitivity

Relative fuel price differences have a significant influence on uptake on LNG
fuelled vessels

Regulatory requirements on EEDI and SOx in particular drives technology uptake
Fuel prices, investment horizon and fuel burden are important drivers
Uptake of LNG fuelled vessels Uptake of smaller engine/de-rating

Scenario D+ is Scenario D with increased fuel burden and investment horizon


14

27 September 2012

FINDINGS

How does this affect the ship owner?

The next decade poses some important questions for the ship owner

When should I install ballast water
treatment systems?
Future delivery capacity
Should I meet sulphur regulations through of technologies and fuel
investing in LNG fuelled engines or
scrubbers, or by fuel switch?

Do I need a NOx Tier III compliant vessel
enabling global operation?
Two-tier second-hand
and charter market
What is my cost-benefit of going beyond
compliance on the EEDI?


FINDINGS

Future delivery capacity of technologies and fuel

Ballast water and sulphur regulations set requirements on ships in operation

In 2020 60,000 ships have to switch fuel
or clean the exhaust
- Are 20,000 scrubbers retrofitted between 2019
and 2020 possible?
- Will there be enough low sulphur fuel available
and at what price?
- Will the availability uncertainty of LNG
bunkering facilities slow uptake of gas fuelled
engines?

By 2020 30-60,000 ships will have to
install a ballast water treatment system
- How many ballast water systems can be
retrofitted each year?


15

27 September 2012

FINDINGS

Two-tier second-hand and charter market

Will there be a two-tier charter market, and which technologies would give a
price premium?
Today’s ships will compete with
increasingly more energy efficient ships
Ships built after 2016 with a NOx Tier II
compliant engine will not be able to enter
an ECA
Will a ship with a scrubber or LNG as fuel
have a higher second-hand value?
Will many ship owners build beyond
today’s requirements and aim for 2020
standards?


BEYOND 2020


16

27 September 2012

BEYOND 2020

Future regulations

Numerous regulations can become important after 2020

GHG
- High attention today, but little progress

Black carbon and particulate matter
- Increasing attention, but difficult to measure
and control

Hull bio-fouling (transport of alien species)
- Guidelines developed, may results in
regulations over the next 10-15 years

Underwater noise
- Raising concerns about possible impact on
ocean-dwelling mammals, but science remains
unclear


Safeguarding life, property
and the environment

www.dnv.com


17

20120911 Shipping 2020

Empfohlen

Empfohlen

Weitere ähnliche Inhalte

Was ist angesagt?

Was ist angesagt? (10)

Andere mochten auch

Andere mochten auch (20)

Ähnlich wie 20120911 Shipping 2020

Ähnlich wie 20120911 Shipping 2020 (20)

20120911 Shipping 2020