Shipowners Will Need a "Great Deal of Money" for Eco-Compliance

Michael Simms said the cost of compliance will be high

New environmental regulations on ballast water management (BWM) and emissions will have unknown, but definitely large, costs for shipowners, accountancy firm Moore Stephens says.

"Shipping is going to have to find a great deal of money over the next few years simply to stay within the rules," said shipping partner Michael Simms.

Simms said BWM systems can cost from $500,000 to $5 million per vessel, with prices likely to rise as shipyards see more demand, and the systems also add annual operational costs of $10,000 to $50,000.

The International Maritime Organisation (IMO) BWM Convention has not yet entered force, but the U.S. and some other countries have already implemented regulations on the systems independently.

Simms said emissions rules, including new standards for sulfur dioxide (SOx) in Emissions Control Areas (ECAs) starting in 2015, as well as rules on nitrogen oxides (NOx) that begin to take effect in 2016, will also add significant costs, with the total price tag unknown.

"Think of a number," he said.

"Any number will do, so long as it is very big. Then double it.

"The answer is likely to be as accurate as any supposedly informed estimates currently circulating in the shipping sector about the likely size of the industry's bill for achieving compliance with incipient environmentally-inspired regulations governing the operation of ships."

In recent weeks, shipowners and other interested parties have warned that the cost of compliance with ECA rules may encourage non-compliance unless authorities step up fines and enforcement.