Asia/Pacific News
China's Adoption of LNG Bunkers Slowed by Policy Gaps, Industry Expert Says
Dr. Gan Shao Wei, director and liquefied natural gas (LNG) expert at China Classification Society (CCS) says that, despite China's 2011 launch of a pilot project to establish a policy framework for the country's adoption of LNG bunkers, regulation to encourage their uptake still has gaps, with rules around LNG bunkering, LNG-propelled vessels, and risk assessments all incomplete, the Motorship reports.
Motivated by efforts to improve China's air quality and a restructuring of the domestic energy market, the country's plan to adopt LNG bunkers has been organised into three stages, says Gan, who was speaking last month's Asia Pacific Maritime conference.
The first is in inland waterways, which will then be followed by coastal vessels, and finally deep sea-going ships.
While less that 2 percent of China's inland vessels are said to have utilised LNG bunkers in 2015, the government is aiming to boost this number to 20 percent over five years.
As part of the plan, Gan says Chinese ship operators have been offered subsidies in order to stimulate the building of gas-fuelled vessels, and most recently, in addition to developing emission standards for ship engines, China announced the establishing of three emission control areas (ECAs), one of which came into effect on April 1, 2016.
However, Gan notes that efforts to adopt LNG bunkers is slowed by policy gaps, such as the requirement for LNG-fuelled ships on inland waterways to maintain 1,000 m of distance in front and behind them - a much larger distance than that required in other countries.
GAN says economic incentive for LNG adoption as a marine fuel also remains murky, adding that "LNG-fuelled vessels cost around 20 percent more to build than equivalent diesel ships, and you can carry less cargo."
"There is no advantage over HFO or MDO in cost, and the total impact on SOx and NOx emissions needs to be studied further."
Another challenge highlighted by Gan is that no official implementation plan for LNG bunkering infrastructure currently exists, an area that is said to be largely driven by LNG retailers.
Further, Gan says that, outside of the current three ECAs, there is a lack of incentive for ship owners to invest in LNG technology, suggesting that the introduction of "a subsidy programme for bunker development, similar to the one in place for companies building LNG ships" may help the situation.
In October, Ship & Bunker reported that Richard Colwall, Managing Director at BMT Asia Pacific Ltd. (BMT Asia Pacific) said China's Ship and Port Pollution Prevention Special Action Plan (SPPSAP) will be the key driver for the adoption of LNG as marine fuel in Hong Kong and the Pearl River Delta (PRD).
