New
rules affecting shipping often come into effect at the turn of the year and
from 1 January 2018 the major change for ships above 5,000gt will be the
requirement to comply with the EU’s Monitoring, Reporting and Verification (MRV
regulation).
The
MRV regulation is the regulator’s response to the accusation that shipping is
not doing enough to reduce its CO2 emissions.
Quite clearly putting a lower limit of 5,000gt on the regulation will exclude
huge numbers of ships, but those that are covered are considered to be
responsible for around 90% of CO2 emissions from ships.
Under
MRV regulation rules, ships will be required to monitor the CO2 emissions from
ships, make an annual report of those emissions to an approved third party
verifier and for the verified reports to be submitted to appropriate
authorities where they will be aggregated. The information gathered will then
be used to determine future efficiency regulation and also very likely to be
used as grounds for including shipping into some market-based measure that will
raise money to supposedly offset the effect of those emissions.
There
are two MRV regulation regimes that will be operating. The first of these to
come into effect is an EU regime with the IMO’s own similar but not identical
regulation coming into effect later in 2018. The EU regime applies only to
ships planning to make calls to ports in the EEA – effectively any EU member
state plus Iceland and Norway. The governing rules are laid out in Regulation
(EU) 2015/757 which is supplemented by Regulation (EU) 2016/2072 (accreditation
and appointment of verifiers) and Regulation (EU) 2016/1927 (requirement for
monitoring plans).
It
is important to read all of the regulations together because shipowners need to
follow designated pathways to making reports and must have a documented plan in
place that will need to be followed. The January 2018 date is in fact the
second of two deadlines in the EU regulation as the requirement for an approved
plan for the company to be in place was back in August 2017.
EU
and EEA shipowners will have been made aware of the requirements by flag states
but for ships registered in other countries the owners may have been unaware of
the exact requirements especially the fact that the verifier must have been
approved by one of the member states of the EEA. The fact that one of the
deadlines has already passed is not a huge obstacle as under Article 6.2 of the
EU rules, the owner will have two months from the date of any affected ships
first port call to put all requirements in place. For any owner still lagging
in implementing the requirements, the 2016/1927 Regulations which can be
downloaded from a number of sources includes a very useful plan template.
MRV regulation – Gathering facts
Although
there may be some grace period for ships which do not yet have a reporting plan
in place, it will be important that they at least understand the requirements
so that appropriate records and documentation can be kept. For each ship this
will include fuel consumption and other parameters, such as distance, time at
sea and quantity of cargo carried. The quantity of cargo carried is included
because the EU ETS (Emission Trading System) that the owners may have to
participate in is about the amount of work done by cargo and distance which is
in contrast to the IMO’s simpler variant which just records distance.
The
monitoring plan is required to describe the vessel and its installed combustion
machinery, and provide information in a complete and transparent manner. What
kind of fuel will be used and which of the provided methods for the
determination of fuel oil consumption for monitoring and reporting CO2
emissions or other relevant information is chosen.
There
are four available methods for determining consumption; Bunker fuel delivery
note (BDN) and periodic stocktakes of fuel tanks, Bunker fuel tank monitoring
on board, Flow meters for applicable combustion processes and finally Direct
CO2 emission measurements using calibrated equipment. It is permissible to use
a combination to improve accuracy. Shipowners need to consider how to measure
emissions which may involve purchasing and installing emission monitoring
systems some of which can simultaneously measure and record other exhaust
emissions such as NOx and SOx.
MRV regulation – Getting help
It
will be some relief to shipowners to know that assisting them in complying with
the EU rules has been prioritised by several organisations especially
classification societies, software and hardware producers and more beside.
Almost without exception, the class societies that are part of IACS have been
approved as verifiers and many of these have also developed their own plan
templates that owners can use to build their own specific plans. Software that
records voyage data can be useful as can the products offered by engine
management and control systems manufacturers.
IMO rules differ
IMO rules differ
Unlike
the EU, which has made no secret of the fact that the collection of data is
intended to bring shipping into an ETS, the IMO’s rules to gather information
on CO2 emissions are at present merely an attempt to quantify exact figures.
What may evolve thereafter will eb a matter for national delegations to the IMO
to decide and that looks to eb a very contentious debate.
The
rules governing IMO data also cover only ships above 5,000gt and they are to be
found in chapter 4 of MARPOL Annex VI under Regulation 22A. In addition, new
appendices have been developed outlining ‘Information to be submitted to the
IMO, including ‘Ship Fuel oil Consumption Database’ (Appendix IX), and ‘Form of
Statement of Compliance – Fuel Oil Consumption Reporting’ (Appendix X). These
rules come into effect from March 2018 and the first reporting period will be
for the full year 2019.
The
data that is collected under the IMO regime is reported to flag states which
will aggregate it and submit the data for the f lag to the IMO for inclusion
into an IMO database. The data to be submitted includes the fuel consumption
data (by fuel type and in metric tonnes), as well as distance travelled and
time at sea, from berth to berth.
There
are other consequences of the IMO rules that will affect all shipowners
including those subject to the EU regulations. All shipowners will have to
ensure that by 31 December 2018, the Ship
Energy Efficiency Management Plan (SEEMP) onboard each of their vessels has
been amended to include the methodologies that will be used for collecting the
required data and reporting that data to the flag state.
The
table below sets out the core components of the two systems alongside each other
for ease of comparison.
Future
Developments
The
EU intends to use the data gathered as a basis for including shipping in its
ETS from 2023/24 if by 2023 the IMO has not established a means for immediate
reduction in CO2 emissions from the industry.At MEPC 72 in April 2018, the issue will be high on the agenda but while there is an acceptance of the need for shipping to become more efficient the method of doing this remains the subject of fierce debate.
The IMO has included the issue as one of its strategic developments adopted at the IMO Assembly in December 2017 and Shipping industry bodies have also submitted proposals. The IMO is planning the adoption of a revised strategy in 2023 to include short-, mid-, and long-term further measures, as required, including implementation schedules. However, there is no evident consensus on the ways to proceed as things stand.
Full details may be read at,
https://shipinsight.com/mrv-regulation/
