The maritime industry is undergoing a significant transition towards reducing emissions, influenced by an evolving set of regulatory requirements aimed at promoting sustainability. The International Maritime Organization (IMO) continually updates its emission reduction goals, while the European Union’s Emissions Trading System and the FuelEU Maritime Regulation contribute to the increasing complexity of vessel operations.
Compliance with these regulations is mandatory, yet the shift to lower-emission fuels complicates route planning for shipping operators. Historically, bunker supply chains were relatively simple, primarily using conventional heavy fuel oil (HFO) or marine gas oil (MGO).
However, the introduction of Emission Control Areas (ECAs) and limitations on nitrogen oxides and sulfur oxides changed this dynamic. As noted by Barry Hooper, Vice President of Product and Technology at Lloyd’s Register, these regulations not only disrupted the SOLAS fleet but also stressed the bunker supply chain.
This led to shortages of ECA fuels in European ports, rising hire rates for compliant vessels, and fluctuations in very low sulfur fuel oil (VLSFO) prices. As the transition to alternative fuels progresses, operators face increased complexity during voyages.
Hooper emphasizes the necessity for operators to evaluate a vessel’s compatibility with cargo, operational needs, and regulatory mandates while considering fuel availability and greenhouse gas intensity in their operating regions. Dr. Edmund Hughes from the International Bunker Industry Association adds that shipping operators typically purchase fuels from the spot market but may need to establish risk-sharing agreements with fuel producers to accommodate specific needs.
Furthermore, while operators work on improving energy efficiency, the new fuels’ lower energy intensity means they will have to refuel more frequently. As regulatory frameworks grow more intricate and the penalties for non-compliance become increasingly severe, it is vital for operators to adopt a proactive stance.
Innovative digital technologies are emerging to assist shipping companies in navigating these challenges. Platforms and route planning software, such as the recently launched Risk Manager solution from Lloyd’s Register, offer tools to optimize fuel use while ensuring compliance with EU ETS and FuelEU regulations.
This technology not only simplifies tracking emissions risks across fleets but also adapts to ongoing regulatory changes.