DIFFERENTIATED PORT DUES AND EPI

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DIFFERENTIATED PORT DUES AND EPI Even Husby, Port of Bergen Dag Sandal & Tor Aarseth at the Workshop Measurement of regional economic effects caused by cruise tourism, Riga Riga / Latvia, April 25 th -26 th 2018

Differentiated port dues and EPI 25.04.2018 Even Husby Port of Bergen Dag Sandal & Tor Aarseth DNVGL

Gross tonnage The current ships will stick around for a while Age Regulations & Differentiated fees Onshore Power Supply LNG, Hybrid

Differentiated port dues based on the actual environmental footprint Environmental Port Index (EPI) Assess the footprint Focus on operational measures while in port The best ships gets a visible discount 11 ports so far. Several ports are planning to join. Trondheim Molde & Romsdal Stranda / Geiranger Ålesund Aurland / Flåm Oslo DNVGL EPI partnere Bergen Eidfjord Karmsund Stavanger Kristiansand

EPI planning- Phase 2-2018 JANUARY Metodology Production process MARCH- APRIL Methodology refinement Dialogues with all major ship owners MAY Testing of compensation scheme 1st version Manual EPI method Partnership workshop AUTUMN Announcement of new port dues 2019 Workshop at Green Port Day 7th Nov. 2018 Further development including digitalization, other classes of ships, etc.

Operation and time in port

Our approach EPI methodology and baseline EPI process Pilot testing NOx CO2 SOx PM +++ Photo: Norwegian Maritime Directorate

How does it work A voluntary system, but if no committment => no discount Initial EPI score Update Departure report EPI score Discount? Calculated from reported data on ship details in relation to a predefined baseline Ahead of first arrival, register or update the EPI profile in an online database (happens only once at start of season) After port visit, the ship submits an EPI departure report This includes measured consumption Operational measures may improve the EPI score As with ESI, local port policy governs the relationship between score and discount

EPI profile and departure report EPI Profile information (example) Diesel engine rating and maker / model Departure report information (example) Average load per running engine (kwh) Diesel engine NOx rating Installed combustion improvement technologies Installed exhaust cleaning technologies Fuel consumption (tons) Type of fuel and its sulphur content Shore power capabilities Usage of exhaust cleaning technologies

Air emission in port depends on 4 factores NOx CO2 SOx PM +++ Exhaus gas treatment Fuel quality Combustion performance Alternative fuels Electrical power demand Shore power

Improvements for each of the factors reduces emissions of NOx, SOx, PM and CO2 Fuel quality Combustion Power demand Exhaust cleaning Compliant fuel Alternative fuels: LNG Hydrogen Bio fuel Technical: NOx rating Slide valves Direct water injection Exhaust gas recirculation Engine load Shore power Battery power Energy efficiency measures SOx scrubbing NOx scrubbing Diesel particulate filters EPI honours improvements according to baseline

SOx emissions factors and baseline Impact High Medium Low Fuel quality Alternative fuels Combustion performance Exhaust gas treatment Shore power Electrical power demand Suggested baseline: Sulphur content in fuel 0.1% SO2 (ppm) / CO2 (%v/v) = 4,3

SOx reporting requirements and rules Reporting requirements Initial EPI profile set-up Engine rating (kw) Exhaust cleaning capabilities Alternative fuel capabilities Departure report Sulphur content in fuel used from Bunker Delivery Note (BDN) Diesel engine running hours [h] Average load [kw] Power produced [kwh] Tons fuel used [metric tons] Usage of exhaust cleaning equipment [h] (if applicable) Suggested rules Compliant fuel might have a sulphur content less than 0.1%, It is suggested that use of such fuel is rewarded Some scrubber systems can clean the exhaust gas beyond the ratio required (4,3) for compliance It is suggested that exhaust cleaning beyond compliance is rewarded Scrubbers also reduce PM, while it remains unclear if the reduction exceeds the emissions from compliant fuel It is suggested to wait for further research on scrubber s effect on PM reduction Average SO2 / CO2 ratio (if applicable)

NOx emissions factors and baseline Impact High Medium Low Fuel quality Combustion performance Exhaust gas treatment Shore power Alternative fuels Electrical power demand Suggested baseline: Tier 1 rating

NOx reporting requirements and rules Reporting requirements Initial EPI profile set-up Engine rating [kw] Engine rpm [rpm] NOx rating Exhaust cleaning capabilities Combustion improvement capabilities Alternative fuel capabilities Departure report Diesel engine running hours [h] Average load [kw] Power produced [kwh] Suggested rules Vessels with Tier 1 engines while built prior the amendments of the NOx Technical Code 2008 will not have an EIAPP with a NOx rating It is suggested that these vessels will not be rewarded If NOx emission measurements has been carried out, this can be used to quantify improvement compared to Tier 1 Usage of exhaust cleaning equipment [h] (if applicable)

CO2 emissions factors and baseline Impact High Medium Low Fuel quality Alternative fuels Combustion performance Exhaust gas treatment Shore power Electrical power demand Suggested baseline: Fuel consumption per normalized unit

18 CO2 reporting requirements and rules Reporting requirements Suggested rules Initial EPI profile set-up Engine rating (kw) Alternative fuel capabilities Fuel saving capabilities Departure report Diesel engine running hours [h] Average load [kw] Power produced [kwh] Tons fuel used [metric tons] Passengers / cargo units onboard Older vessels might not have the required equipment to accurately measure fuel consumption It is suggested that only measurements based on readings from flow meters* It is difficult to establish the baseline for calculating reduction in fuel consumptions It is suggested to test a method using fuel consumption per passenger, grouped by different ship sizes Vessels fitted with shore power connection will call ports with no shore power supply It is suggested to not reward measures which cannot be used (also for e.g. LNG) * Approved types to be verified

19 PM emission factors and baseline Impact High Medium Low Suggested baseline: No baseline

20 PM reporting requirements and rules Reporting requirements Suggested rules Initial EPI profile set-up Engine rating (kw) Exhaust cleaning capabilities Alternative fuel capabilities Departure report Sulphur content in fuel used from Bunker Delivery Note (BDN) Diesel engine running hours [h] Average load [kw] Power produced [kwh] Tons fuel used [metric tons] Research show that there is a strong link between the sulphur content in the fuel and PM emissions It is recommended to link PM emissions to sulphur and reward reductions based on the 0.1% sulphur baseline Scrubbers also reduce PM emissions, while it remains unclear if the emission levels are lower than if compliant fuels were used It is suggested to await further documentation before reduction in PM is rewarded Usage of exhaust cleaning equipment [h] (if applicable)

Typical reduction of emissions for each pollutant Type Method Weight SOx 20% NOx 40% PM 20% CO2 20% FOC impact Electric Compliant and alternative fuels Shore power 100% 100% 100% 100% Battery power 100% 100% 100% 100% Hydrogen 100% 100% 100% 100% LNG 100% 90% 100% 20% Bio fuel 100% 10%? 100% SOx scrubbing 80% 5% 30% 0% +2% Exhaust cleaning NOx scrubbing 0% 85% 0% 0% +2% Diesel particulate filters 0% 0% 50% 0% Slide valves 0% 25% 0% 0% Combustion improvement Direct water injection 0% 15% 20% 0% Exhaust gas recirculation 0% 80% 0% 0% NOx rating Fuel saving * see separate slides Correlated with fuel reduction - x%

EPI calculation example

Test rating of 322 cruise ships arriving in 2018 EPI class Ships Arrivals A 4 14 B 1 5 C 6 28 D 59 202 E 17 73

25 Pilot test throughout the 2018 season Recommended set - up Pilot partners 2 large cruise operators 1 2 small cruise operator 2 3 participating ships from each operator Participating ship s should submit an EPI departure report following each port of call (only participating ports) A tool based on the Excel test model will be shared with the pilot partners DNV GL will work directly with the operator and ship to establish the EPI Profile and assist with departure report submittal The goal is to ensure that the model capture relevant emissions reduction measures and allow ports to test the model based on actual data

Thank you!