Canadian Ports Offer Financial Incentives for Energy Efficiency

Posted by Eric Haun
Monday, January 27, 2014
Photo: Port Metro Vancouver

Canada’s two largest west coast ports are now both offering financial incentives to shipowners based on the ‘A to G’ Greenhouse Gas Emissions (GHG) rating, which benchmarks the energy efficiency of the international shipping fleet.

Port Metro Vancouver’s ‘Eco-Action’ Program and Prince Rupert Port Authority (PRPA)’s ‘Green Wave’ Program will reward the most efficient vessels that enter the ports. PRPA’s Green Wave Program has already received 19 vessel entries during its first two weeks, with 11 of these vessels using the A-G rating.

At both ports, efficient vessels meeting specific GHG emission levels will receive a discount on port dues, rewarding vessel owners that invest in technology and measures to improve their fleet’s efficiency. The rating system, established by maritime risk experts RightShip and global not-for-profit the Carbon War Room, will be used alongside the already-in-use Environmental Ship Index (ESI), which evaluates the amount of Sulphur Oxides (SOx) and Nitrogen Oxides (NOx) emitted.

Port Metro Vancouver’s program has included the A to G rating system for just over a year, while PRPA’s expanded program came into effect on January 1, 2014. Both ports hope to encourage collaboration from other global port authorities to endorse the scheme further.

Port Metro Vancouver is Canada’s largest and busiest port. Duncan Wilson, vice-president of corporate social responsibility at Port Metro Vancouver, said his organization’s “EcoAction” initiative, which takes cleaner fuels, improved engine technology and other factors into account offered discounts amounting to $1.1-million last year, representing roughly 10 per cent of revenue from deep-sea harbor dues.

Michael Gurney, manager of corporate communications at the Prince Rupert Port Authority, said his group’s “Green Wave” program is forecast to provide $100,000 in discounts in 2014.

Don Krusel, President and CEO of the Prince Rupert Port Authority, said, “Through an environmental incentive program with qualification standards consistent across global shipping, we are accelerating the industry’s movement toward greater efficiency and sustainability. As more members of the worldwide port community launch similar initiatives, common systems of measurement and reward are vital to wide adoption and success.”

Currently 16 charterers, which represent 21% of the non-container charter market, 1.6 billion metric tons of commodities transported annually, and 20,000 vessel movements per annum use the A to G rating as part of their vessel selection process.

The A to G rating contains information on over 70,000 existing vessels and provides a simple and easy-to-use tool for ports to provide incentives without additional paperwork. For ports interested in adopting the A to G rating, RightShip can provide a retrospective analysis of a port's distribution of A- to G-rated vessels, as well as the cost implications of shifting to the rating scheme, using historical arrivals data.

RightShip Chief Executive, Warwick Norman, said, “It’s survival of the greenest and owners that invest in the technology to reduce emissions are being rewarded by charterers using their vessels and ports providing discounted harbor dues. If this leads to a two-tier market then less efficient vessels will be driven out of the market.”

Jose Maria Figueres, President of Carbon War Room, said, “It is great to see the ports joining the pioneering charterers who are using the A to G rating to enhance their commercial operations. As important demand-side stakeholders, ports have a key role to play in encouraging greater use of efficiency rating systems and in rewarding shipowners who invest to make their fleets more efficient.”

Both Port Metro Vancouver and Prince Rupert Port Authority are members of Green Marine, a North-American industry initiative that encourages companies to achieve environmental performance that exceeds regulatory compliance. Offering incentive schemes to cleaner vessels is one way a port can achieve a higher sustainability rating within Green Marine’s certification process.

Green Marine executive, David Bolduc, said, “It is great to see Port Metro Vancouver and Prince Rupert Port leading the field in raising the bar to advance environmental protection at seaports in the Americas."

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