Vessel Performance: The SMART Way to Manage Emissions

Peter Mantel discusses how legislation governing emissions from ships is impacting ship owners, operators and charterers at a challenging time for trading conditions

Peter MantelPeter Mantel, Managing Director of BMT SMART, a subsidiary of BMT Group discusses how legislation governing emissions from ships is impacting ship owners, operators and charterers at a time when trading conditions are particularly challenging. He goes on to explain how the drivers that are pushing fuel efficiency to the top of the agenda could deliver expected commercial benefits if vessel performance management systems are adopted. 

Ship owners, operators and charterers are currently faced with unprecedented legislative and commercial pressures. The price-softening and lack of demand in the market, mainly as a result of the credit crunch post-2008, has led to large numbers of vessels being laid-up in either hot or even cold mode. The steady delivery of new build vessels into an already oversupplied market, coupled with a weak global economy, has put yet more downward pressure on freight and charter rates. On top of this there is also far stricter legislation to control emissions.

The introduction of the International Maritime Organisation’s (IMO) Energy Efficiency Design Index (EEDI) and Ship Energy Efficiency Management Plan (SEEMP) guidelines were driven by a desire to reduce CO2 emissions but the greater efficiency they promote should also lead to cost savings. This particular cloud might just turn out to have a silver lining, but how can vessel efficiency be calculated with the degree of accuracy required to make it more than just a best guess?

Vessel performance monitoring equipment is key to economically viable compliance with emissions regulations. In the mid-1990’s estimates indicated that the shipping industry’s share of global CO2 emissions could increase 20-30% by 2050. In response, the IMO introduced a raft of new regulations including the ship pollution rules contained in the “International Convention on the Prevention of Pollution from Ships”, known as MARPOL 73/78. Since October 2013, every ship visiting French shores must report its CO2 emissions for their particular voyage. 

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Emission Control Areas (ECA) for the US Caribbean, including Puerto Rico and the US Virgin Islands come into force during 2014. Worldwide, it is likely that increased regulatory requirements to reduce CO2, NOx, SOx and other effluents, as well as the general environmental impact of ships, will lead to even more stringent recording and reporting requirements. Furthermore by 2015 the EEDI requires new ships to meet agreed efficiency targets.

Measuring and recording tools such as SMARTSERVICES will not only help address compliance issues, but will also help ship owners, operators and charterers to manage the restrictions on CO2, NOx and SOx production within the context of the bigger commercial picture. The commercial reality is that ships not only need to be operated in compliance with the emissions regulations, they need to be operating as efficiently as possible, to ensure they deliver an optimum level of profitability. In truth, this equates to reducing operational costs and promoting efficiency wherever practicable.

The four major costs in ship operation are bunker, crew, fuel and dry docking for maintenance[1]. As crew numbers are governed by best practice and legislation, key savings must be made by making fuel usage as economical as possible and timing dry docking for maintenance to when it will be most beneficial in terms of performance and reliability. Bunker fuel costs can often account for up to 60% of total operating costs so the assessment of fuel consumption is fast becoming an integral part of ship owners, operators and charterers’ operational strategies and an understanding of overall fuel efficiency should soon be high on the agenda.

The key to understanding vessel efficiency is the ability to collect smart data by accurately measuring all the different parameters relating to energy efficiency. Parameters that influence a ship’s energy consumption include its technical efficiency, its state of maintenance, prevailing weather and sea conditions and operational factors such as load and trim conditions. Using SMARTSERVICES as an example, data from existing vessel systems is collected on-board and combined with external environmental data including wind, waves and current, and further processed using the system’s unique coefficients and derived values to analyse many different performance parameters. SMARTSERVICES automatically monitors vessel performance and visualises key indicators and trends using intuitive, interlinked on-board and on-shore applications. All parameters are measured through sensors installed during newbuild or retro-fitted during routine maintenance.

The importance of deploying an independently validated system cannot be overstated. When measuring, validating and benchmarking vessel performance there are a wide range of stakeholders within the supply chain, each with their own vested interests. It’s far too easy for a vested interest to become a conflict of interest. The most effective way of dealing with this eventuality is to ring-fence the measurement and validation process, keeping it completely separate from any other consultancy or equipment supply arrangement.

Demand for Fleet and Vessel Performance Management (FVPM) is increasing, as growing numbers of ship owners and contractors realise the benefits. The multiple pressures on the global maritime industry mean that ship owners and contractors can no longer afford to ignore the performance of their fleet. However, there is still scepticism within certain elements of the shipping community and some ship owners, operators and charterers are still wary of the value such a monitoring system can deliver. Perhaps this is understandable having been used to an environment where Chief Engineers produced miracles on a regular basis, armed only with the data from dials in their engine rooms. However, the industry is changing and there is a growing need to deliver stakeholder transparency on top of commercial and regulatory considerations. Cargo owners, charter companies, banks, investors and insurance companies are increasingly demanding evidence of environmental and operational efficiency commitments when making contract decisions. Ship owners, operators and charterers need to be able to provide independently validated performance results to satisfy their stakeholders.

Eradicating this cynicism is crucial in order to give the shipping industry a fighting chance of securing real, long term improvements in operational efficiency.  This can only be achieved through independently monitoring, reporting, verifying and analysing vessel and fleet performance, providing complete performance visibility on-board and on-shore.  By introducing accurate on board sensor technology, owners and operators can effectively obtain data related to the vessel’s outputs including fuel flow meters, shaft torque meter, GPS, speed log, ECDIS and emission sensors.

Arguably, the greatest value that performance monitoring tools like SMARTSERVICES can deliver becomes clear when one looks beyond the benefit to a single ship on a single voyage. Once multiple data-sets become available from multiple vessels over a period of time, the information can be used to benchmark performance and drive improvements across a fleet. Key indicators and trends that could lead to a positive change for future voyages can be leveraged, while single parameters that are causing a drop in efficiency can be identified and addressed. Dry-docking for maintenance and renewal of antifouling can be timed to take place just before any rapid drop-off in vessel performance, highlighted by historical and probalistic efficiency and operational data.

Looking to the future it is not unrealistic to envisage a time when all merchant vessels are equipped with a fully integrated bridge where performance parameters and emissions data is displayed alongside navigation systems and thruster controls. Voyage planning can already be checked against efficiency and emissions requirements to identify the most appropriate routing, while performance management reports can be produced automatically.  Such reports can cover everything from environmental impact, hull and propeller efficiency and bunkering factors through to crew data, scheduled maintenance results, economic modelling and SEEMP/legislation.

The combination of more rigorous legislation and harder economic conditions has led to a situation where ship-owners and operators need to have easy access to the emissions and performance data for their vessels. Yes there is still scepticism, but the tide is turning. The benefits of being able to use real-time data to dynamically manage the performance of a fleet of vessels, or choose to analyse and review data over a period of time, to be able to make informed operational and maintenance decisions are hard to ignore.

[1] Moore Stephens OpCost 2013

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Peter Mantel

Fareham Office
First Floor, 3700 Parkway
Solent Business Park
PO15 7AL

Tel: +44(0)1489 889260