EMEA News
Norway Tax Will Discourage Uptake of LNG Bunkers: SEA\LNG
A recently approved domestic CO2 tax on LNG fuel in Norway will deter the uptake of liquefied natural gas (LNG) bunkers in the country, according to SEA\LNG.
The group, which advocates the use of the alternative marine fuel, said the move was badly timed and will likely increase emissions.
"Emissions reductions is a key driver behind the tax; while we clearly support such an aim, a CO2 tax outside a wider framework could lead to unintended consequences," SEA\LNG said.
"It acts as a disincentive for the uptake of an available and low CO2 fuel such as LNG now, as well as future investment in LNG-fuelled ships. As such, the tax will likely lead to an increase in emissions of climate gases, NOX, sulphur and particulate matter."
Compared to burning traditional oil-based bunkers, LNG significantly reduces NOx as well as producing near-zero SOx and PM.
However, performance on GHGs is less clear, with some claiming it can achieve a reduction of up to 20% compared to oil, while others say when methane slip and other fugitive emissions are taken into account over the full lifecycle, the GHG savings are small to zero.
If there is a silver lining to Norway's tax, it is the prospect of it stimulating LNG bunkering in neighbouring countries.
"The tax may create some degree of incentive for vessels to bunker abroad. In doing so, they would avoid paying the tax," SEA\LNG noted.
The group also called on Norway to reconsider the tax in favour of an internationally coordinated approach.
