August heralded a new era of pollution control in North American waters with major implications for marine lubricants and bunker fuels. Ships operating within 200 miles of the continent-the new North American Emission Control Area-must now meet stringent limits for fuel sulfur content.
Ships entering coastal North American waters are now required to switch to fuel containing no more than 1 percent sulfur. By 2015, the limit will fall to 0.1 percent.
Outside established Emission Control Areas (ECAs), the maximum sulfur content of a ships bunker fuel is 3.5 percent. By 2020, the maximum global requirement will fall to 0.5 percent.
In addition to ship operators and OEMs, the push for more stringent emission controls impacts makers of marine cylinder lubricant (MCL), who must adjust their product lines to accommodate the lower sulfur content. Historically, MCLs came in two flavors-high and low BNs, or Base Numbers. BN is a measure of alkalinity, which is required to neutralize acidic combustion within the large two-stroke engines that are most common on ocean-going vessels.
MCs with higher BNs (in the 70s or 80s) are for use with fuels with medium to high sulfur content (1.5 to 3.5 percent). Lower BNs (in the 40s) are for the low-sulfur fuels required within ECAs. Today, more and more MCL makers are coming out with midrange BN lubricants (in the 50s) that claim to cover both ends of the sulfur content spectrum.
Kline & Co. estimates that the global finished lubricants market was 38 million metric tons in 2011. Out of that, marine lubricants account for approximately 6 percent or 2.4 metric tons.
When the North American ECA took effect Aug. 1, it became the third designated ECA globally. The others are in the Baltic and North seas. A fourth area, the U.S. Caribbean Sea ECA, covering Puerto Rico and the U.S. Virgin Islands, is scheduled to take effect Jan. 1, 2014. Hong Kong is implementing an ECA beginning in 2015.
By 2015, approximately 90 percent of the worlds container ships will involve ECA transits, according to Lloyds Register.
In U.S. waters, the North American ECA will be administered by the U.S. Environmental Protection Agency and the U.S. Coast Guard, which is authorized to board ships to confirm compliance. The two will share responsibility for investigating non-compliance and subsequent enforcement actions.
Enforcement will fall to Transport Canada in Canadian waters.
The ECAs were established by the International Convention for the Prevention of Pollution from Ships (MARPOL), which defined acceptable standards for carbon and sulfur emissions in its Marpol 73/78 Annex VI. The International Maritime Organization, created by the United Nations, adopted the MARPOL Convention in 1973. It has been amended several times since them
The EPA website says that by 2020, ships operating in the ECA are expected to reduce their annual sulfur oxide (SOx) emissions by 920,000, nitrogen oxide (NOx) emissions by 320,000 tons and fine particulate matter (PM2.5) emissions by 90,000 tons, which is 86 percent, 23 percent and 74 percent, respectively, below predicted levels in 2020 absent the ECA.
The overall cost of the North American ECA is estimated to be $3.2 billion by 2020, while its benefits are expected to include preventing as many as 14,000 premature deaths and relieving respiratory symptoms for nearly five million people each year in the United States and Canada. The EPA estimates monetized health-related benefits to be as much as $110 billion in the United States in 2020.