California Bunker Fuel Regulations Spur Shift in Shipping Routes

by Marc Scribner on June 23, 2011

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I’ve previously reported (see here and here) on the environmental industry’s movement’s war on bunker fuel, the heavy fuel used by large ships around the world. The modus operandi of the enviros is to pursue and convince regulators, such as the United Nations’ International Maritime Organization (IMO) or California’s Air Resources Board (CARB), to push for a targeted patchwork of prohibitions and/or mandating low-sulfur fuel-switching, enacting stricter speed limits in near-shore shipping lanes, restricting on-ship power generation when in port, and imposing emissions taxes.

A couple of years ago, the U.S. Environmental Protection Agency (EPA) was toying with the idea of calling for strict and extremely costly regulations or a federal ban on bunker fuel -carrying or -using ships within U.S. waters, only to be shouted down by politicians and citizens from states with large maritime sectors. But California, a state not known to back down from adopting stupid environmental regulations, moved forward in the war on bunker fuel and international trade and set its own regulations on fuel use and petroleum conveyance in the maritime industry operating within the state’s waters.

But the maritime industry, being smarter than California’s eco-regulators, found a second-best way to access the major port complexes in Los Angeles and Long Beach: reroute around the Santa Barbara Channel’s restricted fuel zone. The new route is longer, takes more time, and it requires ships to cross the U.S. Navy’s Point Mugu Sea Range, but it allows them to cut costs by allowing them to use cheaper bunker fuel for a larger portion of the trip.

The Navy is obviously annoyed with this development, and in fact warned CARB in 2008 that adopting the Vessel Fuel Rule would greatly increase shipping traffic through the Point Mugu Sea Range [PDF, page 5]:

The U.S. Navy contends that the avoidance route would be attractive to shippers for a number of reasons. First, shippers will save fuel costs since they will be outside the OGV Fuel Rule 24 nm zone and therefore, not be required to use the more expensive, cleaner fuel. Second, the avoidance route may be outside any potential future vessel speed reduction zones, allowing the ships to travel faster to reduce shipping time. Third, the U.S. Navy has pointed to efforts to reduce marine mammal strikes in the Santa Barbara Channel which may in the future either impose slower vessel speeds in the channel or move the routes outside the Santa Barbara Channel. In addition, the U.S. Navy contends that if shippers use an avoidance route, on-shore air quality will be negatively impacted.

Despite this warning, and despite CARB analysts finding that the avoidance rate among ships would range between 50 and 100 percent, CARB moved forward with the Vessel Fuel Rule. The radical environmentalist litigators at the Natural Resources Defense Council — which was co-founded by career rent-seeker John Bryson, who has been tapped by President Obama to replace outgoing Secretary of Commerce Gary Locke — are predictably floored. But fortunately for consumers and the maritime industry, and unfortunately for Gaia-worshipers, it doesn’t seem likely that CARB will be able to completely prevent the industry’s rational cost-cutting measures.

ADDENDUM: On June 24, CARB elected to increase the current 24-nm restricted fuel zone to beyond the Channel Islands, thereby drastically reducing the savings (if not eliminating them for some ships) of using the avoidance route. But there are still reasons, particularly for ships with older engines, to keep using traditional bunker fuel (rather than marine gas oil or low-sulfur marine diesel). Switching to “cleaner” fuels, for one, can cause propulsion failures due to thermal shock because burning low-sulfur fuels can cause huge temperature spikes and they have a lower lubrication quality, which leads to stuck fuel valves and pump plungers — and an engine shutdown. If this occurs in a channel filled with rock hazards and strong currents, ships — unable to maneuver — can be wrecked, which can result in far more serious environmental problems than slight reductions in ambient air quality.

Sean June 23, 2011 at 11:27 am

It will be interesting to see how CA maritime traffic will diminish when the expansion of the Panama Canal is completed.

JMW June 24, 2011 at 8:03 am

Somewhere in California Senator Boxter is probably being briefed by the Hollywood trendy guilt tripping celebrities with their own environmental agenda (e.g. Ted Danson’s Oceana) and Friends of the Earth (Friends?) for a continuing bout of the sillies.
The last time she adopted their policies it was all about two policies. One, ban HFO and two: impose a tax on Bunker fuel (there is no requirement for these people to have sensible coherent policy) so there was the prospect of a horse race in which whichever horse won, that’s the policy they would adopt but always with the chance of two horses tied at the line so they could both ban HFO and tax it.
However, while there is a law of unintended consequences, which most usually applies to any action by politicians, there is nothing about them being unexpected consequences (and in most cases a three year old can see what those consequences are likely to be the firt time the policy is mooted). Hence when going down this route Senator Boxer met her Waterloo in the shape of the Senator for Louisiana (intent on protecting the billions of dollars that port activities bring to the state).
The thing is, if we left it to IMO and resolved these issues through treaties, which is shown to be the best way, or the least bad way, to deal with trans-boundary pollution, then we might have fewer problems and fewer dumb policies.
The very worst way to deal with global issues is through unilateral legislation.
In the case of these tax/ban policies, if adopted in the USA, the Louisiana Senator pointed out that they might make things a little better locally but the net effect would be to make pollution worse. The reason being that if bunkers become too expensive in the USA and if regulations imposed on shipping and enforced with the usual gung ho attitudes complete with punitive fines (necessary globally but bad news locally imposed) a policy of rewarding whistle-blowers and criminalising seafarers, usually the crew who have little choice but not the company directors, then expect that ships will bunker and discharge cargoe where it is cheapest to do so. e.g. Mexican or Canadian ports and then transfer cargoes into and out of the US by road or rail. Well, actually, the cargoes out bit is ambitious. Already manufacturing is exploiting Mexico and so it goods produced there by US companies already by-pass US ports.
This, of course, adds to the pollution burden because road and rail are far less efficient and thus less polluting that sea freight. Of course, the big penalty would be that such shipments would also bypass the great river systems which are also very much less polluting.
Now this means California must be aware of the dangers of unilateral legislation so it should come as no surprise when they legislate as a state that the consequences will not be what they intend. And it it probably isn’t a surprise which makes you wonder why they go ahead and do it anyway.
And it isn’t as if the other environmental groups aren’t concerned about propeller noises etc as these vessels also impinge on or approach conservation areas.
In the end, apart from making the usual allowances for the dumber things California legislation does, you wonder if they are wilfully blind to the motivations and lack of concern for the truth within the organisations that manipulate them.

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