“The Environmental Challenge” MARTECMA - Air emissions from ships "The way forward” Athens, 21 January 2008 Olav Nortun, Det Norske Veritas Senior Vice President and Technical Director

Increase in global shipping Shipping most CO2 efficient of all transport modes Without shipping the world stop 2-4% of global CO2 emissions The trend is increased global trade and thus increased shipping with China as a driver. Raw materials from Australia, Africa, Europe and USA Consumer goods from China to Europe and USA In this perspective let me remind you that shipping is the most CO2 efficient of all transport modes. Without shipping the world stops. © Det Norske Veritas AS. All rights reserved 19 November 2018

The changing reality of shipping Reduced number of accidents and amount of accidental oil spills Leads to focus on other issues of importance for the local and global environment. NOx, SOx, CO2, PM Decommissioning – disposal and recycling Cargo and cargo residues VOC Toxic inventory and contamination Hull Form For many years the focus has been on reducing accidents and oil spills. In today,s world this is not enough. We need to focus on a wider range of issues ……………..SEE slide. This seminar concentrate on emission to air, namely CO2 NOx SOx Particulate matters Volatile Organic Compounds Fuel Quality Ballast Water Sewage system Waste, incl. bilges Antifouling © Det Norske Veritas AS. All rights reserved 19 November 2018

Controlling air emissions from shipping Source: Is there anything wrong with shipping – NO. It is just that air emissions has been put high up on the agenda. Everybody is struggling to cope with this new issue. This has been an issue for many industries over years and now is has come to the shipping world as well. Here is two pictures from the Geiranger fjord in Norway. On a clear day and on a clear day after quite a few calls from passenger ships. The challenge is that shipping is in the medias focus as a polluter. We are challenged and are expected to do something. © Det Norske Veritas AS. All rights reserved 19 November 2018

Sulphur deposition from shipping 2020 Baseline 2000 2020 Level 2 2020 Maximum According to a study done for EU by International Institute for Applied Systems Analysis (IIASA) there is an alarming development. If the target is to cut Sox with 14 % and NOx with 28% (level 2) the estimated cost is around €800 millions/year If the target is to cut Sox with 80 % and NOx with 90% (maximum) the estimated cost is around €5,5 to 6,5 billions/year Ambition level 2 SO2 0.5 percent S in residual oil or scrubbing equivalent (2g SO2/kWh) in SECA, and for passenger vessels everywhere NOx Slide valve retrofit on all slow-speed engines pre-2000 Humid air motors for all new engines post-2010 This would, in 2020, reduce SO2 emissions by 14 percent compared to the baseline and NOx emissions by 28 percent. Estimated Cost €800 m/year Maximum Reduction of the S content of residual oil to 0.5 % until 2020, and a 15 % reduction of emissions of NOx from existing vessels combined with 50 % reduction for new (post-2010) vessels. Implementing selective catalytic reduction technology (SCR) on all post-2010 ships. This would, in 2020, reduce SO2 emissions by 80 % compared to the baseline and NOx emissions by 90 %. The costs increase with 5.7 billion €/year. Total 6.5 billion €/year. Source: IIASA Contract No. 06-107 © Det Norske Veritas AS. All rights reserved 19 November 2018

Emissions in Europe - Inventories of NOx NOx emissions NOx Why is this important Contribute to global emissions of nitrogen oxides (NOx), sulfur oxides (SOx). Estimated by 2020, ship emissions contributions to EU NOx and SOx inventories will surpass total emissions generated by land-based mobile stationary and other sources sources in the 25 nations NOx – exhaust gas – cleaning on board (SOx ultimately have to be solved at the refineries) © Det Norske Veritas AS. All rights reserved 19 November 2018

Not sustainable to continue ”as is” CO2 emissions CO2 The CO2 emissions from shipping constitutes a small percentage of total emissions- So why should we care? Shipping will globally increase due to increased demand New ships delivered today will operate 25 years from now. The contribution from shipping will increase because other industries will reduce. The “revised” Kyoto protocol will most likely include shipping. Shippers or owners of goods shipped may require shipping to reduce its emissions. © Det Norske Veritas AS. All rights reserved 19 November 2018

Legislative Development – Air Emissions 2007 MARPOL Annex VI revision 11. August 2007 North Sea SECA 1,5% 2008 End 2008 - EU commission review End – MARPOL Annex VI Adoption period June/July MEPC 59 – Concluding on CO2 indicator MARPOL Annex VI Tacit Approval 2009 2010 EU January 2010 0,1% sulphur limit MARPOL Annex VI – Into Force 2011 NOx reduction applies for new engines Kyoto Protocol to be “renewed” 2012 The legislative development, except for MARPOL Annex VI is difficult to follow. However I have tried to give a overview of important issue and when they most likely will pop up on the agenda. 2008: EU comission will review progress on development within IMO, notably MARPOL and Annex VI and MARPOL Annex VI will be adopted. 2009: There is a expectation that at MEOC 59 there will be a proposal for CO2 indicator or index. This to facilitate trading. However, it is voluntarly. This is the year for tacit acceptrance of Annex VI 2010: Ships berthed in Europe to use fuel with 0,1 % Sulphur. MArpol Annex VI enters into force 2011: Requirement to new engine with a maximum NOx emission of 15 to 25% 2012: Kyoto protocol to be renewed will most likely include shipping and aviation Where is this driving us: © Det Norske Veritas AS. All rights reserved 19 November 2018

Regulation of emissions to air Historically IMO has set the agenda through MARPOL. The challenge; EU will enforce regulations if IMO does not manage to react with sufficient speed (GHG focus). Encourages member states to support quick process in IMO Recent study has identified three options: 1 Include maritime transport in EUs Emission Trading Scheme 2 Differentiation of harbour dues 3 Ships calling EU ports to meet limit CO-2 Index UNFCCC, shipping in next Kyoto Protocol Port state specific regulations are emerging United Nations Framework Convention on Climate Change (UNFCCC or FCCC) Port state specific regulations are emerging - GUIDELINES FOR PORT STATE CONTROL UNDER MARPOL ANNEX VI _MEPC Circ. 472 © Det Norske Veritas AS. All rights reserved 19 November 2018

Thank you for your attention! © Det Norske Veritas AS. All rights reserved www.dnv.com 19 November 2018