Asia/Pacific News
Hong Kong Low-Sulfur Mandate Could Push Carriers to Shenzhen
Hong Kong's new mandate for ships to use low-sulfur fuel at berth could push some carriers to switch to ports in Shenzhen, the South China Morning Post reports.
Starting in January of 2015, ships arriving at Kwai Chung Container Terminal will be required to use fuel with no more than 0.5 percent sulfur content under a law that is expected to pass next year.
That could add $600,000 to $1.5 million to a shipping line's annual bunker costs.
Hong Kong authorities have been in negotiations with the Shenzhen government to create an Emissions Control Area (ECA) around the Pearl River Delta, but Shenzhen has so far only encouraged a voluntary switch to lower sulfur bunkers.
"It is inevitable that the requirement would further put Hong Kong ports' competitiveness at stake," said Arthur Bowring, managing director of the Hong Kong Shipowners Association.
"That's why the government should consider extending an incentive scheme that subsidise carriers for the extra fuel costs."
Currently, carriers that voluntarily use lower sulfur bunkers receive a subsidy to help pay for the extra cost, but Christine Loh, undersecretary for the environment, said that plan is unlikely to be renewed after the mandate begins.
Loh said a regional ECA is unlikely to be put in place within the next two to three years, but she said the new rule is unlikely to drive carriers out of Hong Kong.
"The shipping lines said that would not be a determinant factor when they decide which port to call at," she said.
