The shipping industry is moving towards more sustainable operation faster than expected, but environmental regulation must be enforced internationally through the IMO rather than on a regional basis, the CEO of Stena Line said today.
“There is going to be change, and I would argue that we are moving out of heavy fuel oil and, whichever way we twist and turn, we’re probably heading that way a lot quicker than many of us think,” said Carl-Johan Hagman, CEO of Stena Line, speaking at the International Chamber of Shipping (ICS) conference at London International Shipping Week.
“We think that the refining industry has responded a lot quicker than we ever would have thought. A year ago, it was simply not available to have the qualities of fuel that we have today,” Hagman said of the transition to low-sulphur marine fuel in sulphur emissions control areas (SECAs), which has been smoother than expected.
Stena Line itself has been hard hit by shipping emissions regulations in Europe as almost all its vessels trade in the SECA in northern Europe and the Baltic, apart from the company’s services in the Irish Sea.
Compliance with SECA regulations costs Stena Line around €50m a year, Hagman said, but fortunately the company has been able to pass the costs on to its customers, mainly because of lower oil and bunker prices.
“When the politicians have decided that the macro trend is towards more environmental and sustainable shipping, you cannot go against that flow,” Hagman said, which prompted Stena Line to start looking into alternative marine fuels such as LNG and methanol.
“We do not think it will stop with SECAs,” he told the conference, “we are sure that we will get NECAs [nitrogen oxide emissions control areas] and further CO2 regulations too.”
The unilateral decision to instate an SECA in northern Europe and the Baltic was “very damning”, said Hagman said, who warned that similarly fragmented, regional legislation will make it difficult to foster quality shipping worldwide.
“It is so important that we as shipowners stop reacting to the outside world and that we rather provide solutions,” he continued “There are no guidelines as to how this will develop. We have to step up and be part of that conversation and I can only endorse that that is to be done through the IMO. It is only when we have a level playing field that we will be able to develop quality shipping.
“I can only hope that the actions that we take go hand-in-hand with the IMO. If we open up to local legislation, not only does it hamper our industry, but definitely it opens up to protectionism.
“I think the beautiful part of shipping is that we are contributing to globalisation and the prosperity of humanity, and therefore doing good is doing well for our industry, but only if we do it together and through the IMO.”