The Shipping Industry’s Pollution Problem Part III: Off The Hook

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By Adam Sarvana, DC Bureau

Part III in the four-part series No Safe Harbor about the shipping industry’s emissions problems

When it comes to the pace of regulating deadly shipping emissions, not everyone is content to adopt a wait and see (or “follow the IMO”) attitude. As it has done before, California recently passed its own regulation in the absence of federal standards. Since July 1, any ship longer than 400 feet or heavier than 10,000 gross tons has been required to limit its sulfur fuel content to 5,000 ppm, dropping to 1,000 ppm in 2012, within 24 miles of the state’s coastline.

The rule makes particular sense given the state’s position as a major shipping center: if you combine the Los Angeles and Long Beach ports, which exist as an unbroken strip of facilities with no apparent dividing line, you have the nation’s busiest shipping hub. (Oakland, about 330 miles to the north, is the country’s fifth largest.) The California Air Resources Board, which designed the rule, estimates that it will reduce overall particulate matter (not just PM2.5) by 83 percent and SOx by 90 percent along the coast, preventing about 3,600 premature deaths statewide by 2015. The Pacific Merchant Shipping Association had argued that the air board had no jurisdiction beyond the three-mile limit of state (rather than national) waters, although it lost a court case over the issue shortly before the rule was finalized.

The EPA has made similar calculations on behalf of the national emissions control area (ECA) proposal: if granted, according to the agency’s March regulatory announcement, it would “reduce emissions of NOx by 320,000 tons, PM2.5 by 90,000 tons, and SOx by 920,000 tons per year, which is 23 percent, 74 percent, and 86 percent below current levels, respectively. The overall cost of the ECA is estimated at $3.2 billion. The ECA would be expected to save as many as 8,300 lives and provide relief from respiratory symptoms for over three million people each year. In total, the monetized health-related benefits of the proposed ECA are estimated to be as much as $60 billion in the U.S. in 2020.”

However, Oceana’s Jackie Savitz pointed out that despite these potential future benefits of a new rule, the agency has so far declined to regulate foreign-flagged ships docking at U.S. ports, which it could be doing today.

“We have the ability to regulate ships that use our ports,” she said. “We can regulate ships if we put our mind to it.” However, she said, EPA is simply behind the times: “The shipping industry has grown very quickly on a steep curve. It’s become a part of the problem all of a sudden.” Under the Clean Air Act, she said, the agency arguably has the power to regulate any ship docking at a U.S. facility ─ the question is one of will rather than legislative jurisdiction.

Along with the EPA, the International Maritime Organization (IMO) has not been as active as observers had hoped. Despite the fact that it has the responsibility to control greenhouse gas emissions under the United Nations Framework Convention on Climate Change (UNFCCC), it is currently involved in a reverse tug-of-war in which neither it nor developing nations will take full control of climate change regulation.

“If the IMO set emissions standards on all ships, developing countries would have to comply with those greenhouse gas responsibilities, and they don’t want to do that,” said Sarah Burt of Earthjustice. Instead, those countries “would be happy if the United Nations [as a whole] took the regulatory power back,” perhaps at the upcoming meeting of party nations to the UNFCCC in Copenhagen in December, “because then they’d have no responsibility.”

The distinction is crucial, because even though the IMO is a part of the UN, its rules are enforced differently than some other UN mandates. If the IMO regulates emissions, all countries must comply equally; under the climate change framework, poorer countries would have fewer responsibilities compared to larger economies like the U.S. and Australia.

Furthermore, neither the IMO nor the International Civil Aviation Organization, the airlines’ counterpart, “has made much progress inventorying what contribution their fuels make to climate change,” according to Burt. Nor shall they be required to do so: Joseph Cox, of the Chamber of Shipping of America, pointed out that the Waxman-Markey climate change bill recently passed by the House of Representatives puts the onus on fuel producers to cap and trade carbon emissions, not the industries that actually use the fuel. In his own estimation, he said, “transportation” ─ including shipping ─ “is off the hook” if the bill is signed into law as written.

Bryan Wood-Thomas of the World Shipping Council (WSC) suggested that refiners may also be, in some sense, off the hook.

“I’ve been told by some oil players that if someone needs 1,000 ppm sulfur fuel, [they’ll] take some lower-sulfur fuel and blend it with some dirtier stock to bring it up to that level,” he said. “If they’re able to use some dirtier stock this way, it’ll help them manage their [product] streams.”

Although the prospect is anecdotal at the moment, he said it’s a realistic one, although he also holds out hope that refiners won’t bother because it will ultimately not prove cost-effective to go to the trouble. Interestingly, these questions of fuel quality have all come about, he said, because shipping lines made a deal with refiners in the middle of the last century to switch from low-sulfur to bunker fuel ─ before then, chunky refinery leftovers were “otherwise pretty useless.”

Indeed, refineries began selling “residual fuel” ─ which, it is useful to remember, Wood-Thomas himself refers to as “crap” ─ only as a way to try to make pennies on the dollar of what would otherwise be a complete throwaway item. Shipping, in other words, went from burning low-sulfur fuel to providing a handy dumping ground for the refinery industry’s waste stream. Shippers have now been spewing this waste into the oceans and the atmosphere for decades.

How will the IMO respond to its regulatory responsibilities going forward? The organization does little to address criticisms of its record. The same online industry overview that describes the rapid pace of industry growth in such anodyne language (officially titled International Shipping and World Trade: Facts and figures) trumpets the miracles of modern shipping in almost comic terms:

"The history of shipping is a glorious and proud one. There is no doubt, for example, that the magnificent square riggers of the era of sail or the early 20th century’s prestigious ocean liners could stir the hearts of all those that beheld them. But the ships of today are just as worthy of our admiration, for shipping today is in another truly golden age. Ships have never been so technically advanced, never been so sophisticated, never been more immense, never carried so much cargo, never been safer and never been so environmentally-friendly as they are today.”

No amount of tongue-in-cheek can disguise the industry cheerleading underlying the sentiment. Nor can it cover the fact that the organization has, to date, never mandated a single industry-wide accounting for greenhouse gas emissions.

If the IMO won’t inventory black carbon or CO2 output, the EPA may be forced to go it alone. Earthjustice formally petitioned the agency in October 2008 to regulate greenhouse gases and black carbon ─ not just from shipping but from all sources ─ and Burt pointed out that the Waxman-Markey bill includes a mandate “to study and if necessary regulate” black carbon emissions. However, although the agency is moving forward on regulating automobile emissions in the wake of its official finding earlier this year that CO2 presents an “endangerment” to public health, it has not yet addressed shipping emissions and may not do so in the near future, Burt said.

“There are a number of things to study and the EPA has the authority to decide in what order to study them,” she said. “We don’t have a good sense of the timing” on when it will choose to study shipping.

Nor did any sources seem to know why the U.S./Canadian ECA application excluded Alaska beyond the fact that, as John Kaltenstein of Friends of the Earth pointed out, the EPA had previously determined that “further information is needed before asking for an ECA in the Arctic.” Among other reasons, the air quality model used to support the ECA request “didn’t extend to Alaska and Hawaii,” he said, because emissions measurements are more difficult where there is a low population density. However, the populated portions of Hawaii are included in the ECAapplication; most of Alaska is not. (The application only includes a stretch along the southern coast, stopping short of Kodiak Island or the Alaskan Peninsula that begins the chain of Aleutian Islands.) Mike Levine of Oceana could only say, “Our primary concern is that shipping in the Arctic is safe and responsible. … We feel that Alaska should have been included in the ECA request.”

While shipping emissions present a large and mostly unregulated problem, they are not the only environmental hazard presented by today’s ships. As Savitz pointed out,

“Cruise ships weren’t first envisioned as floating cities with three thousand people. There’s one line in the Clean Water Act that says you have to have a ‘marine sanitation device’ on board. That’s fine for fishermen, but when you have three thousand people using the john, that’s not always good enough.”

Indeed, a separate story remains to be written about the environmental implications of commercial cruise lines, which have been known to extort favorable treatment from Mexico and other needy countries in the form of generous access to scenic but fragile coastal ecosystems, and run just as far under the radar as cargo shipping in terms of international oversight.

On emissions, at least, the European Union (EU) may take a firmer stand. According to Savitz, the EU “has said they’ll include ships in their [greenhouse gas] cap and trade system if the IMO doesn’t act by December in Copenhagen” to regulate them separately. (“It’ll remain to be seen if the EU is satisfied or not” with the IMO’s proposal at the climate meeting, whatever it turns out to be, she said.)

At the same time, a long-standing but never finalized IMO proposal to create a non-binding Energy Efficiency Design Index for ships has been taken up by concerned members of the UK’s House of Commons, who have extended it into a call for mandatory efficiency requirements. Left alone, she said, the IMO “may come up with one or two [efficiency] equations” ─ perhaps including greenhouse gas emissions and other performance measurements ─ “but they wouldn’t be mandatory. My sense is that the IMO is in the middle and the UK and EU are outside poking them in different ways.”

Much hinges on the outcome of the December meeting in Copenhagen, she said, where updates to the general climate regulatory framework will be debated and the EU and other parties will press for stricter shipping standards to which the IMO may not be amenable. Of the Design Index, Wood-Thomas only said, “It’s anticipated that there’ll be an agreement that ships built after year X will have to be more efficient by Y percent over today’s fleet average, as determined by how much fuel the ship burns.” This vague anticipation, perhaps understandably, is not always enough to mollify IMO critics.

Along with implementing the Design Index, the MEPC, the environmental arm of the IMO, also considered (but did not vote on) the U.S/Canadian ECAproposal during a July 13-17 meeting in London, alongside discussion of whether to adopt an Energy Efficiency Operational Index that would allow a crew for the first time to objectively measure the fuel efficiency of a ship in operation. (Wood-Thomas compared the Design Index to measuring a car’s miles per gallon and the Operational Index to “how you drive that car.” Like many of the other proposals at the London meeting, even if somehow implemented, it is not expected to include new mandatory objectives.) The environment committee also considered a Ship Energy Management Plan “which incorporates best practices for the fuel efficient operation of ships,” according to the meeting’s agenda.

The fact that these non-binding suggestions are still being debated in mid-2009 gives an observer some idea of how far behind the curve everyone ─ the shipping community no less than international regulators ─ truly is in terms of controlling shipping emissions.

Wood-Thomas said that although shipping has grown quickly in recent years, the efficiency of ship design has lagged demand for new vessels by a wide margin.

“During the ship-building boom of the last ten years, the environment was actually very non-conducive to innovation,” he said. “Producers would build one particular ship design. They wanted to pump these things out as quickly as possible. If you wanted something with special [environmental] features, you’d either hear, ‘Talk to someone else,’ or you’d pay an exorbitant amount.”

Nor has the global recession slowed the production of these vessels: because ship purchases are often contracted three or four years ahead of time, new ships are still rolling off the lines despite the dip in global trade demand. “There’s hundreds of ships sitting idle all around the world,” he said. “Some are sold for scrap. Others are tied up in the Philippines or wherever and anchored, if they’re still viable ships.”

Facing this picture of a profitable but hardly nimble industry, and despairing of voluntary corporate changes or hard international air quality targets, American activists are by and large just hoping the new ECAis granted when the IMO votes next year.

“An ECA is a way to prime the pump a bit, because global standards don’t go into effect until 2020 or 2025,” said Kaltenstein of Friends of the Earth. “You can’t get health benefits without an ECA because you’d wait for another decade for a global standard.”

What if communities start taking their own action? What might the chaotic regulatory environment that the shipping industry fears look like?

The government of Long Beach, California, is so desperate for quick relief that it now pays the difference between the cost of bunker fuel and low-sulfur distillate for any ship that uses the cleaner substance near its shoreline ─ the kind of move that may be repeated elsewhere (and subjected to legal challenges) if the IMO does not step up its efforts to cut harmful emissions more broadly around the globe. Wood-Thomas said that while the question was not addressed in various rulings on the California low-sulfur fuel rule, the idea that sub-national political entities such as states or cities can indirectly regulate international commerce is likely headed for the courts, perhaps at very high levels.

While the WSC does not take an official position on the scope of California’s authority, he said, “You can find lawyers who say there’s no reason they can’t [regulate], and others would say no, they can’t for this and that reason. We don’t know how that will play out. In the meantime, the requirements are very real.”

So where are things headed?

“The EPA [doesn’t] want to get ahead of IMO standards” in setting any potential shipping emissions rule, said Burt of Earthjustice. At the same time, “There’s a very strong international shipping lobby, and they made it clear that [EPA standards] would put the U.S. at a competitive disadvantage.”

This makes it very hard for observers to know in whom they should place their trust ─ the IMO, with its record of slow deliberation and reluctance to pass strict measures, and the EPA, with its history of prevarication and legal manipulations, present what seem from the outside like equally bad options. Perhaps the EU will step up, or the United Nations will create a stronger international regulatory regime when it meets in December, or perhaps locales will be left to follow California’s example on a piecemeal basis.

Whatever paradigm ultimately emerges, it will come after polar ice has already melted from black carbon at a growing rate and the world’s coastal communities have been choking for decades.

(Originally published at


The Shipping Industry’s Pollution Problem Part I: Low-Hanging Fruit

The Shipping Industry’s Pollution Problem Part II: A Lack of Authority

California Fights Shipping Pollution As International Shippers Push Back

(Photos, top to bottom: Flickr/biofriendly/CC BY 2.0; Flickr/azza-bazzo/CC BY-SA 2.0; Flickr/Lisa Sanderson/CC BY 2.0; City of Los Angeles)