Sub-Committee on Pollution Prevention and Response (PPR), 4th session, 16-20 January 2017

Implementation of the 0.50% sulphur limit
The Sub-Committee began work to ensure the consistent and effective implementation of the 2020 0.50% m/m sulphur limit, which was decided by MEPC 70.

The proposed work would be aimed at exploring what actions may be taken to ensure consistent and effective implementation of the 0.50% sulphur limit for fuel oil used by ships operating outside designated SOx Emission Control Areas or not making use of an equivalent such as an Exhaust Gas Cleaning System, as well as actions that may facilitate effective policies by IMO Member States.

The Sub-Committee agreed that consistent and effective implementation of the 0.50% sulphur limit is critical for commercial considerations and to achieve the environmental benefits sought through regulation 14, which regulates emissions of sulphur oxides (SOx) in MARPOL Annex VI.

Inconsistent and ineffective implementation would increase the uncertainty concerning actual market demand for 0.50% sulphur marine fuel oil, which in turn would increase the difficulty for the marine fuel oil supply chain to plan effectively to meet global demand and for ship operators to assess the viability of investing in exhaust gas cleaning systems.  Importantly, ineffective implementation is likely to lead to more ships using non-compliant fuel oil so having a significant commercial advantage over ships complying, leading to a distortion in the market.

The scope of the work, proposed to be completed during PPR sessions in 2018 and 2019, could include:

• Considering the preparatory and transitional issues that may arise with a shift from the 3.50% m/m sulphur limit to the new 0.50% m/m limit;

• Considering the impact on fuel and machinery systems that may result from the use of fuel oils with a 0.50% m/m sulphur limit;

• Considering verification issues and control mechanisms and actions that are necessary to ensure compliance and consistent implementation;

• Developing a draft standard format (a standardized system) for reporting fuel oil
non-availability that may be used to provide evidence if a ship is unable to obtain compliant fuel oil;

• Developing guidance, as appropriate, that may assist Member States and stakeholders in assessing the sulphur content of fuel oil delivered for use on board ship, based on the consideration of mechanisms to encourage verification that fuels supplied to ships meet the specified sulphur limit as stated on the bunker delivery note;

• Requesting ISO to consider the framework of ISO 8217 standard for fuels supplied on a world-wide basis for consumption on board ships, with a view to keeping consistency between the relevant ISO standards on marine fuels and the implementation of regulation 14.1.3 of MARPOL Annex VI; and

• Considering any consequential regulatory amendments and/or guidelines necessary to address issues raised or otherwise considered necessary to ensure consistent implementation of regulation 14.1.3 of MARPOL Annex VI.

In considering what additional measures may be developed to ensure consistent implementation of the 0.50% sulphur limit, the justification notes that implementation of the 0.50% sulphur limit in 2020 will significantly reduce SOx emissions to the atmosphere from the world's fleet, but this new international regulatory standard will also introduce a significant change in the daily operating cost of ships operating outside ECAs. Those additional costs are of a magnitude that could cause serious commercial distortion if there is uneven implementation of the 0.50% sulphur limit.

Products emerging to meet the 0.50% sulphur limit are expected to cost less than traditional marine distillates, but a substantial price differential is nevertheless anticipated with various forecasts suggesting a wide range. Therefore, without consistent implementation to all ships, it is impossible to ensure a level playing field for use of the 0.50% sulphur limit fuel oil, with the result that the expected improvement of the environment and human health could not be achieved.

Concerns on fuel oil quality and ships' safety were also noted. 

MEPC 71 will be invited to approve a new output on consistent implementation of regulation 14.1.3 of MARPOL Annex VI. 

Regulation 14.3.1 sets a 0.50% limit on the sulphur content of fuel oil used onboard ships from 1 January 2020, down from 3.50% currently. In emission control areas (ECAS), the limit will remain at 0.10% m/m.