Applying Cold-Ironing Regulation in Southeast Asian Ports to Reduce Emissions

asia-pacific journal of ocean law and policy 2 (2017) 296-316 brill.com/apoc

Nicholas Monacelli Coast Guard Legal Service Command, usa [email protected]

Abstract

The imo estimates that international shipping contributes 796 tons of greenhouse gases each year, representing more than 2% of the global total. While the majority of these emissions occur at sea while transiting between ports, a non-trivial amount occurs while ships are docked. The traditional practice has been for ships to keep their engines running while in port, primarily to generate power. “Cold ironing” is when, al- ternatively, ships in port shut down their engines and take power from the pier. While a novel concept in the shipping industry, it has been the status quo for naval vessels for nearly a century. American ports pioneered the technology, while other global facilities have room to improve. This research investigates the extent that cold ironing will assist in reducing overall greenhouse gas emissions in Southeast Asian ports. Additionally, it looks at the hurdles to implementation, and other alternatives. Amongst a complex web of technology and regulatory schemes to minimize shipboard emissions, the practical effects and benefits of cold ironing cannot be ignored.

Keywords

Cold-ironing – maritime emissions – greenhouse gases – Alternative Marine Power – Onshore Power System – shore power

Applying Cold-Ironing Regulation 297 i Introduction1

Maritime shipping is a worldwide industry, responsible for the overwhelming majority of global commerce. Similarly, maritime emissions represent a universal concern. Shipping contributes to CO2, NOx, SOx and particulate matter pollution everywhere merchant vessels ply their trade. Shipping accounts for approximately 3% of global greenhouse gas pollutants.2 As the industry and technology develop, regulators and governments continue to search for ways to mitigate the effects of maritime emissions. In some ways, the United States and Europe are far ahead of their Asian counterparts in leveraging technology to reduce the impact of emissions in their ports. Ships require electricity while in port. Traditionally, merchant vessels were required to continuously run their engines, generating pollution, to power operations. Spewing pollutants into the atmosphere at sea and in port, smokestacks and machinery were always “hot.” Over the last 20 years, advanced ports in the United States and Europe began requiring that visiting vessels must shut down their engines. Through technological advancements, ships can power down their engines while in port, going “cold iron.” Ships moored at these modern ports can connect into the shore side power grid, receiving electricity from the port itself. With new ways to “plug” into cleaner power sources available from the shore, some of the busiest ports in the world were able to reduce emissions from 50–95%.3 Port regulators phased in rules requiring all visiting vessels to install and use new technology if they wanted access to the port and surrounding mar- kets. These “cold ironing” regulations have been wildly successful in large ports

1 Lieutenant Nick Monacelli is a 2008 graduate of the United States Coast Guard Academy. He has served around the world, including his most recent tour as Executive Officer of the seagoing buoy tender Sequoia, homeported in Apra Harbor, Guam. His operational expertise includes international fisheries enforcement, search and rescue, communications, and aids to navigation. He is currently assigned to the Coast Guard Legal Service Command in Alam- eda, California. 2 International Maritime Organization, Third imo ghg Study 2014, (London: imo, 2015), available at http://www.imo.org/en/OurWork/Environment/PollutionPrevention/AirPollution/ Documents/Third%20Greenhouse%20Gas%20Study/GHG3%20Executive%20Summary %20and%20Report.pdf. 3 Corbett, James & Comer, Bryan, ‘Clearing the Air: Would Shore side Power Reduce Air Pol- lution Emissions from Cruise Ships calling on the Port of Charleston, sc?’ Energy and Envi- ronmental Research Associates, llc, 9 Sep 2013, available at http://coastalconservationleague .org/wp-content/uploads/2010/01/EERA-Charleston-Shoreside-Power-Report-.pdf.

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including Los Angeles, Seattle, and Rotterdam.4 However, Asia has been slow to implement “cold ironing” technology and regulation. With most of the world’s largest ports, Asia, and specifically Southeast Asia, could see substantial reductions in shipping emissions through new regulations and programs. The Western approach to cold ironing serves as an example for large Asian cities to mitigate the harmful effects of air pollution in their ports. This article investigates how regulators and planners can approach using cold ironing technology in Southeast Asia. Through investigating the technology, a brief history, and the current state of the art and regulation, this paper analyzes how Southeast Asia can leverage cold ironing to substantially abate vessel emissions. ii Background

The concept and technology of “cold ironing” is not revolutionary. The basic concept is that, instead of keeping a ship’s engines running to provide services and power during port, a ship is able to shut down its engineering plant. In this sense, the engineering plant can go “cold,” while connections to the shore provide the necessary power. A ship can shut down its generators, which burn marine bunker, in exchange for receiving cleaner sources of power from shore. Today, modern vessels require an immense amount of power while operating in port. A large container ship can use 6 mw, while cruise ships can draw upwards of 12 mw.5 For some perspective, this equates to a large container ship using the equivalent of 100,000 60W common lightbulbs. While the amount of power that ships use may be surprising to some, it becomes obvious when one realizes the immense electrical requirements of hydraulic cranes, pumps, and air conditioning. The power requirement becomes much greater on modern mega cruise ships, which provide hotel services for 5000–6500 people.6 As

4 “Alternative Marine Power.” Port of Los Angeles, available at https://www.portoflosangeles .org/environment/amp, ‘Port of Seattle Cutes Vessel Emissions by 29 Percent Annually and Saves 26 Percent of Energy Costs per Call,’ Community 40 Cities (4 Nov 2011), available at http:// www.c40.org/case_studies/port-of-seattle-cuts-vessel-emissions-by-29-annually-and-saves -26-on-energy-costs-per-call, “Context of Transport Climate Action.” ppmc, available at http:// www.ppmc-transport.org/port-vision-for-2030-the-port-of-rotterdams-climate-initiative/. 5 Winkel, Johnsen, Hoen & Papaefthymiou. “Potential for Shore Side Electricity in Europe: Final Report.” ecofys. 2015. 6 The largest cruise ship in the world is Royal Caribbean’s Harmony of the Seas. Harmony of the Seas Fact Sheet. Royal Caribbean, see the ship characteristics at http://www.royalcarib beanpresscenter.com/fact-sheet/27/harmony-of-the-seas/. Hotel services include all of the

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Applying Cold-Ironing Regulation 299 floating cities, cruise ships require as much power as a small city to maintain operations. Whereas a small city may have a stand-alone power plant to generate its electricity requirements, a cruise ship generates electricity through burning fossil fuel in the form of heavy marine bunker. Today’s technology allows ships in port to “plug in” to shore services. By plugging into shore connections, ships can shut down their generators, and cut emissions. As one can imagine, shifting power to shore can result in emission reductions, especially when the available energy is “clean.” In parts of the world where wind, solar, and natural gas power generation are common, ships can dramatically reduce their share of emissions. However, in other areas, where dirty coal provides most of a region’s energy, it may be overall “cleaner” for a ship to generate its own power using clean marine fuel. While cold ironing is not a universal solution, in regions where regulators encourage clean energy, cold ironing achieves substantial emissions reduction. Still, the idea of “Alternative Marine Power” (amp) or “Onshore Power Sys- tems” (ops) is becoming more attractive. Ports recognize the benefits of providing clean energy to visiting ships, by keeping the local air clear of emissions. Cold ironing witnessed a jump-start as a movement on the Western Coast of the United States in response to California environmental regulations. Today, other ports in North American and Europe see the benefits of cold ironing. Port authorities have the ability to yield a wide variety of economic incentives and regulatory approaches to encourage cold ironing, with some ports entirely clearing their air from maritime emissions from moored ships. iii History

While the idea of using cold ironing in commercial ports is relatively new, the concept has been around since ship electrification in the early twentieth century. Immediately after naval engineers realized the capability of electricity onboard ships, efforts quickly turned to shipboard generators. Onboard electricity could provide lighting, ventilation, pumping capability, and possibly propulsion. However, at the beginning, commercial shipping took the path of independent electrical generation onboard merchant vessels. Since standard electrical connections did not yet exist, it was more cost effective for ships to rely on their own means to generate power while in port. On the other hand,

amenities and creature comforts of a modern hotel, including lighting, air conditioning, casinos, pool pumps, etc.

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300 Monacelli military vessels implemented the concepts of cold ironing very early in its development.7 United States government ships, including those of the U.S. Navy and Coast Guard, regularly “plugged” into port. Since naval ships spent more time in port, it made more sense to find a solution as an alternate to running generators 24 hours a day. Additionally, naval ships tended to visit the same ports in the form of U.S. naval bases around the world. Those bases could provide standard shore connections while limiting the cost of adapting to multiple standards. Shore power connections were an inherent design requirement for U.S. vessels, and military leaders began to realize the potential capability for shore power in assisting operations.8 One good example is Hurricane iwa in 1982. Hurricane iwa struck the Hawaiian island of Kauai, the northwestern-most main island. The inhabitants lost power, with more than 95% without electricity. The U.S. Navy dispatched the nuclear submarine uss INDIANAPOLIS to respond and provide humanitarian assistance. One important consideration was the submarine’s ability to use its nuclear reactor as a mobile power plant. Because the INDIANAPOLIS had cold ironing equipment installed, it could plug into Kauai’s power grid and feed electricity to the island. Capable of producing 1.5 mw of electricity, the submarine was enough to provide power to the entire island. Although relief workers were ultimately able to repair the island’s power plant before the INDIANAPOLIS arrived, the ability to provide power in an emergency highlights why the military considered shore power connections as an essential capability.9 Still, merchant shipping operators did not have the same operational requirements as the military and were slower to integrate cold ironing technology. While the military was focused on reducing operational and main- tenance costs associated with continuously running generators, industry did not have the same incentives. In fact, the Port of Los Angeles/Long Beach (la/lb) first introduced widespread application of cold ironing only in 2004. A confluence of events created the political will and conditions to make cold ironing a reality. Clean air regulation in the United States and California first began to materialize in real force

7 Stewart, George, ‘Going Ashore: Naval Ship to Shore Power for Humanitarian Services,’ Na- val Historical Foundation (6 March 2014), available at http://www.navyhistory.org/2014/03/ going-ashore-naval-ship-to-shore-power-for-humanitarian-services/. 8 Ibid. 9 ‘Navy Seeks to Return Power to Stricken Hawaii Island’ The New York Times (New York, 29 Nov 1982), available at http://www.nytimes.com/1982/11/29/us/navy-seeks-to-return-power -to-stricken-hawaii-island.html.

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Applying Cold-Ironing Regulation 301 after the turn of the twenty-first century. The state of California set aggres- sive targets to shift towards renewable energy generation, including solar and wind resources.10 The shift away from using electricity generated by burning fossil fuels sparked innovation. Regulators realized that with cleaner sources of electricity available on land, if ships were able to tap into the shore side grid, regulators would be able to reduce emissions. Before 2004, the practical effect of reducing emissions by plugging into the grid would have been negligible. Cold ironing would have only shifted the point of emissions from ships at piers to inland power plants. It is interesting to note that without clean air regulation in California, port authorities would have continued to ignore the benefits of cold ironing. When first implementing cold ironing in 2004, la/lb envisioned that it could achieve an 80% reduction in ship emissions by 2020.11 Though commercial application is new, over the last decade, other large ports in the United States began to implement cold ironing as an emissions abatement tool. The Port of Seattle was one of the first to recognize the impact of leveraging cold ironing on cruise ships, the most power hungry commercial vessels. Starting in 2006, Seattle put cold ironing technology at its major cruise ship dock.12 See- ing remarkable success in the form of Seattle’s 29% emissions reduction, other large cruise ship ports quickly began to study cold ironing’s feasibility. Across the Atlantic Ocean, cold ironing spread quickly. The Port of Rotter- dam is now one of the largest cold ironing ports in the world, as it aggressively seeks to minimize emissions. Some ports in Europe require that ships have the capability to plug into the electrical grid in order to moor.13 Still, the largest ports in the world, those in Southeast Asia, remain behind. The Port of Shanghai is investigating the technology, but it is not yet realized. Other ports, including the Port of Singapore, could realize substantial emissions reductions by leveraging the technology. Still, the costs of implementing

10 See the State of California materials on the Renewables Portfolio Standard which requires clean energy generation, available at http://www.energy.ca.gov/portfolio/. 11 See Port of Long Beach informational page on shore power infrastructure and policy for the port, available athttp://www.polb.com/environment/air/shorepower.asp. 12 ‘Port of Seattle Cutes Vessel Emissions by 29 Percent Annually and Saves 26 Percent of Energy Costs per Call,’ Community 40 Cities (4 Nov 2011), available at http://www.c40.org/ case_studies/port-of-seattle-cuts-vessel-emissions-by-29-annually-and-saves-26-on-en ergy-costs-per-call. 13 Fiadomor, Richard, Assessment of Alternative Marine Power (Cold Ironing) and Its Im- pact on Port Management and Operation, MSc Thesis, (World Maritime University, Mal- mo, Sweden, 2009), available at http://commons.wmu.se/cgi/viewcontent.cgi?article= 1276&context=all_dissertations.

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302 Monacelli cold ironing at the world’s largest ports is steep. Regardless of the effect, in- troducing the technology would be a massive undertaking at Shanghai or Sin- gapore. The ports could expect to spend billions of dollars to outfit wharves, while the impact on emissions is dependent on local energy generation. Still, the technology is becoming less expensive, with more versatile and innovative options available than ever before. Combined with the rapidly decreasing costs of renewable energy technology, cold ironing is quickly becoming a more attractive solution. iv The Technology

Industry leaders continue to make progress on both the shore side and vessel component aspects of technology. While this paper does not seek to delve into the technical specifications, it is important to realize the various equipment needs for both ports and ships. Generally, implementing cold ironing technology requires investment in facilities both where the ship will “plug-in” and onboard the vessel itself. Power grids are not identical around the world. A universal connection standard that can adapt to different requirements is critical. Just as an individual must use a power adapter to charge their cell phone in a different country, ships need power “adapters” to permit plugging into the grid in such various ports as Houston, Rotterdam, Shanghai, and Singapore. The first system components are installed onboard vessels. The necessary equipment includes the switchboards, receptacles, and transformers required to adapt shore side power into something that a vessel can use for its own purposes. One emerging connection standard is the containerized “High-Voltage Shore Connection” (hvsc). Once again, the Port of la/lb is a pioneer in push- ing ieee to make hsvc the industry standard.14 Figure 1 depicts an hvsc container about M/V DALLAS EXPRESS. It is a self-contained solution, and works well onboard container ships and those vessels with enough deck space to ac- commodate it. Its major benefit is as a stop-gap solution. Until new ships with integrated cold ironing technology are available, it provides an excellent bolt- on capability. Still, there are major disadvantages. Namely, it remains difficult to put containers on ships that are not designed to carry them. Tankers, cruise ships, and roll-on/roll-off vessels have nearly no capacity for hsvc containers.

14 ‘Guide for High Voltage Shore Connection’ American Bureau of Shipping, Nov 2011, available at https://www.eagle.org/eagleExternalPortalWEB/ShowProperty/BEA%20Reposi tory/Rules&Guides/Current/182_HighVoltage/Guide.

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Applying Cold-Ironing Regulation 303

Figure 1 hvsc container solution

Non-container ships also do not normally have cranes to on and off load the hsvc equipment.15 While hsvc are a good fit for some ships until retrofits and new ships come into play, other ships require alternative solutions. Specifically, the cruise ship industry embarked on a massive undertaking to retrofit their fleets with cold ironing technology. The cost to outfit a single cruise ship can exceed $10 million, but operators remain driven by the reduced operational costs of buying power from ports versus burning fuel.16 With cruise ships, it is important for them to be able to retain fuel for propulsion. Any fuel they can save by not running generators may be used to extend the interval between lengthy refueling operations. In some instances, using less fuel on generators will allow cruise ships to completely avoid fueling operations in ports where taking on fuel is prohibitively expensive. The operational savings justify the millions of dollars in capital investment to purchase “power adapters” for cruise ships. While onboard technology is important, it means nothing unless ports build out infrastructure. Put another way, an extension cord is no good unless you have a power outlet. “Power outlets” for ships in port are even more expensive than the onboard equipment. The shore side infrastructure requirements include lengthy power supply lines, high voltage transformers, and power

15 Ibid. 16 ‘Shipping Emissions in Ports,’ International Transport Forum. Discussion paper 2014–20, oecd, 2014, available at http://www.itf-oecd.org/sites/default/files/docs/dp201420.pdf.

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conditioners to prevent fluctuations. Shore side connections generally follow the same hsvc standard, allowing interoperability with hsvc containers. Other solutions exist, including a robotic product designed by Seimens specifically for cruise ships. With the capability to provide 12 mw of electricity, it is a self-contained solution adapted to cruise ship needs in Europe. Debuting in 2014, this particular solution provides efficient and reliable connections to cruise ships through remote operation and control.17 The industry continues to develop new products to make cold ironing more effective. Still, the ulti- mate solution will be to get away from stop-gaps such as the hsvc containers and move to incorporating shore power technology in ship design. As demon- strated by the U.S. military, engineers can build the technology into new ships without taking up too much room or otherwise affecting the ship’s ability to carry out its purpose. Ports in the U.S. and Europe see the benefit of cold ironing nearly immediately, on a daily basis. Any delay in using the technology, in light of shore power becoming “cleaner,” means a delay in eliminating toxic emissions into ports and the surrounding cities. v Benefits of Cold Ironing to Southeast Asian Ports

Experts estimate that vessel exhaust emissions account for up to 9% of sulfur oxide and up to 30% of global nitrogen oxide air pollution.18 Further, the shipping industry continues to grow, both in volume and ship size. In 2009, the biggest 15 ships had the same SOx emissions as all of the cars on the planet. With more than 90% of global trade passing over the sea, it is clear that reducing these emissions will have a significant impact on mitigating air pollution.19 Mitigating air pollution is an important goal, especially in the maritime industry. Much of the global emissions related to the cardiopulmonary mortality

17 Siemens, Siemens builds the first European onshore power supply for cruise ships, 22 July 2014, available at http://www.siemens.com/press/en/pressrelease/?press=/en/pressre lease/2014/infrastructure-cities/low-medium-voltage/iclmv20140503.htm&content[] =ICLMV&content[]=EM. 18 Vidal, John. “Health risks of shipping pollution have been ‘underestimated.’” The Guard- ian. 9 Apr 2009, available at https://www.theguardian.com/environment/2009/apr/09/ shipping-pollution. 19 Theodoros, Papoutsoglou, ‘A Cold Ironing Study on Modern Ports, Implementation and Benefits Thriving for Worldwide Ports,’ Thesis, (School of Naval Architecture and Marine Engineering, National Technical University of Athens, Athens, Greece, 2012), available at http://www.martrans.org/docs/theses/papoutsoglou.pdf.

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Applying Cold-Ironing Regulation 305

rate are focused on areas of high shipping traffic. Figure 2 and 3 depict the shipping industry’s contribution to worldwide particulate matter pollution and the cardiopulmonary mortality rate attributed to that pollution, respectively.20 It is apparent that the global shipping pollution “hot-spots” align with the greatest threat to human health from emissions. It is important to highlight that the biggest global contribution from shipping occurs in Southeast Asia,

PM Concentration Case 2b Change 0 – 0.05 0.05 – 0.10 0.10 – 0.20 0.20 – 0.50 0.50 – 1.0 1.01 – 2.00

Figure 2 Shipping industry global contribution to pm pollution

Case 2b Mortality Cardiopulmonary 1 – 10 11 – 50 51 – 100 101 – 200 201 – 300 301 – 600

Figure 3 Cardiopulmonary mortality rate

20 Ibid.

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where the benefit of cold ironing would be most pronounced. While each port is certainly unique, the overall situation merits further analysis. Cold ironing represents one method of reducing air emissions. Other means, including on types of fuel and propulsion systems, work in parallel. Taken to- gether, the combination of methods reduces shipping pollution at all points. Cold ironing remains an important component, especially given that it is easy to implement once ports develop the necessary infrastructure. Advanced ports using cold ironing technology see 95–98% pollutant reductions.21 These reductions occur across all types of emissions, including carbon dioxide, nitrogen oxides, sulfur oxides, and particulates. Figure 4 is a

(A) CO (B) NOx 6.0 70 5.0 60 50 4.0 40 3.0 30 Metric Tons 2.0 Metric Tons 20 1.0 10 0.0 0 Shore Power Vessel Power Vessel Power Shore Power Vessel Power Vessel Power (2013) (2015) (2013) (2015)

(C) PM10 (D) PM2.5 2.5 2.5 2.0 2.0 1.5 1.5 1.0 1.0 Metric Tons Metric Tons 0.5 0.5 0.0 0.0 Shore PowerVessel Power Vessel Power Vessel Power Shore Power Vessel Power Vessel Power Vessel Power (2013, 1% S) (2013, 0.5% S) (2015, 0.1% S) (2013, 1% S) (2013, 0.5% S) (2015, 0.1% S)

Figure 4 Emissions reduction in the Port of Charleston, usa

21 Corbett, James & Comer, Bryan, ‘Clearing the Air: Would Shore side Power Reduce Air Pollution Emissions from Cruise Ships calling on the Port of Charleston, sc?’ Energy and Environmental Research Associates, llc, 9 Sep 2013, available at http://coastalconservationleague.org/wp-content/uploads/2010/01/EERA-Charleston-Shoreside-Power-Report -.pdf.

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Applying Cold-Ironing Regulation 307

representative sample of reductions for the port of Charleston, South Carolina, United States.22 The primary driver for the Port of Charleston was the availability of cleaner forms of energy. Second, the port was largely concerned with cruise ships as major polluters while in port. As discussed, cruise ships are the largest category of polluters because of their own power requirements. Table 1 shows the share of each pollutant in their respective ports, and highlights the significance of reductions. For example, in Hong Kong, more than half of all sulfur oxide emissions are attributed to shipping.23 Other ports, such as the Ports of Los Angeles and Long Beach, have realized similar reductions. In those ports, the infrastructure is primarily designed for cargo ships. While 45% of the Los Angeles area’s sulfur oxide emissions came from the port in 2011, the relative amount continues to decline as the port works towards its goal of 80% cold ironing utilization by 2020.24 Still, cold ironing infrastructure and technology will only benefit those ports that can provide

Table 1 Port pollutants by type

Port SO2 pm NOx Source

Hong Kong 54% – 33% Civic Exchange 2009 Shanghai 7% – 10% Hong et al. 2013 Los Angeles/Long Beach 45% – 9% Starcrest 2011 Rotterdam – 10–15% 13–25% Merk 2013 Kaohsiung 4–10% – – Liu et al. 2014 Hong Kong 11% 16% 17% Yau et al. 2012 Taranto 7% – 3–17% Gariazzo et al. 2007 Izmir 10% 1% 8% Saraçoglu et al. 2013 Venice – 1–8% – Contini et al. 2010 Brindisi – 1% 8% Di Sabatino et al. 2012 Los Angeles/Long Beach – 1–9% – Agrawal et al. 2009 Melila – 2–4% – Viana et al. 2009 Algeciras – 3–7% – Pandolfi et al. 2011

22 Ibid. 23 ‘Shipping Emissions in Ports,’ International Transport Forum. Discussion paper 2014–20. oecd. 2014. 24 See Port of Long Beach informational page on shore power infrastructure and policy for the port, available at http://www.polb.com/environment/air/shorepower.asp.

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308 Monacelli energy that is cleaner than the ships can generate. For example, in a port where the majority of electricity is generated by coal fired plants, it may be better for ships to remain on their generators. For much of Southeast Asia, clean energy is years away. However, for countries committed to clean energy sources, cold ironing will achieve similar benefits as seen in the U.S. Cold ironing can help to reduce all of the emission types noted in Table 1, though the largest reduction is likely in sulfur oxides. Few fossil fuel power generating plants use fuels that create sulfur oxide emissions, while all emit carbon dioxide and most emit some particular matter. Sulfur oxides are almost exclusively attributed to sulfurous fuel, such as that used in ships and diesel trucks. Even with the introduction of low sulfur fuel requirements by the imo and port-states, sulfur oxide emission remains one of the biggest areas where cold ironing can achieve meaningful reductions. As Southeast Asian ports continue to grow and develop, planners can engage to determine the potential benefit. In Singapore, the current electricity generation profile is not as “clean” as some ports in the United States or Europe. However, Singapore’s initiative to achieve 33% renewable energy by 2035 may change the analysis.25 With 1/3 of the port’s energy supplied by non- fossil fuel sources, cold ironing would mean significant emissions reductions. However, in the short run, it may be more beneficial for ships to use low sulfur fuel, or other mitigating technology (such as scrubbers). It is important to note that each port is unique and requires an individualized solution based on how the city gets its power. While the shipping industry as a whole is responsible for 3–4% of emissions globally, researchers have difficulty attributing those emissions between those at sea and while moored. However, researchers have been able to identify the proportion of shipping emissions while in port to the overall port’s emissions. The International Transport Forum published a list of the top 10 ports for sulfur oxide and carbon dioxide in 2014. Figure 5 depicts their results.26 One important finding is Rotterdam’s data. When the survey was taken in 2014, Rotterdam’s cold ironing program was firmly in place. The port’s cold ironing program significantly reduced sulfur oxide emissions, since vessels no longer burn sulfurous bunker in port. However, the port is still responsible for a fair share of carbon dioxide emissions, placing it in the top three positions

25 Kiong, Goh Chee, ‘Singapore: Asia’s clean power growth frontier,’ Singapore Economic Development Board, 2012, available at https://www.edb.gov.sg/content/edb/en/resources/ downloads/articles/asias-clean-power-growth-frontier.html. 26 ‘Shipping Emissions in Ports,’ International Transport Forum, Discussion paper 2014–20, oecd, 2014.

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Figure 5 Worldwide Port Sulfur fuel requirements worldwide. The Rotterdam case study shows how cold ironing results will vary heavily by port. Still, as one of the world’s largest ports, Rotterdam authorities can be pleased with nearly eliminating their sulfur oxide emissions. Singapore took the top position for both carbon dioxide and sulfur oxide emissions, at 5.9% and 6.5%, respectively. While Singapore is a massive port and many would expect it to have an outsized share of relative emissions, the results also indicate a potential for greatly reducing absolute maritime emissions. Taken with the other top port emitters, 22% of the industry’s sulfur oxide pollution directly affects 40 million people.27 The health benefits of eliminating or substantially reducing these emissions, as in the case of la/lb, are certainly non-trivial. With shipping emissions estimated to increase fourfold by 2050, developing ports can make a positive impact through leveraging cold ironing technology in 2017.28 Taken with other measures, cold ironing will have a substantial positive impact on reducing emissions. vi Cold Ironing Alternatives

Cold ironing is only one technique in reducing emissions, although it is the only one where ports can exercise exclusive control. Other methods include

27 Ibid. 28 Ibid.

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310 Monacelli scrubbers, low sulfur fuels, and ship design. While each has its benefits, they are not substitutes for cold-ironing. Rather, they are complements. Some crit- ics argue against cold ironing because these other techniques can effectively mitigate shipboard emissions. However, as discussed below, planners should not dismiss cold ironing on the basis that other methods are available. Ship operators use “scrubbing” technology to purify emissions at the source. By installing equipment in smokestacks, both physical and chemical processes remove pollutants before they are released. Scrubbers are relatively inexpen- sive and passive. With very little operational cost, industry leaders often prefer scrubbers to more expensive abatement technologies. If used while a ship is transiting, scrubbers effectively minimize the amount of vessel emissions and disperse those emissions as the ship travels. However, in port, even with scrubbers installed, ships continue to generate emissions. One example where scrubbers do not solve the problem is the situation where scrubbers reduce the amount of a particular emission by 50%. If the port has an increase in vessels using the port and emitting pollutants, the absolute effect of scrubbers is minimized. In fact, if the port doubles capacity, the overall port emissions will be the same as before scrubbers were installed. As a contrast, if a port receives clean energy from shore and uses cold ironing technology, the energy will be clean (and emissions eliminated) regardless of port growth. Since experts anticipate the shipping industry to continue growing, ports will increase capacity and the absolute effect of using scrubbers may be neutral. Vessel operators view scrubbers as a low-cost alternative to meeting strict low sulfur fuel requirements at some ports. Low-sulfur marine fuel reduces sulfur oxide emissions, but limits are not uniform. Additionally, the extra refin- ing process translates to extra costs; low sulfur fuel is nearly 50% more expensive than standard marine distillate.29 In certain areas of the world, individual ports or imo regulations are strict. In other areas, the limits are twenty to thirty times higher.30 Perhaps unsurprisingly, ports in Southeast Asia have some of the laxest requirements for low sulfur fuel, highlighting the importance of other abatement methods. Ports in Southeast Asia are quickly realizing the benefit of cleaning fuel, however. For example, the port of Shenzhen, in China, implemented a low sulfur fuel requirement ahead of schedule, mandating the use of

29 Fung, Freda, et al, ‘Prevention and Control of Shipping and Port Air Emissions in China,’ White Paper, nrdc, Oct 2014. 30 Thurlow, Rebecca, ‘The Dirty Truth About Asia’s Cruise Ship Emissions,’ The Wall Street Journal (New York, 11 Mar 2015), available at http://www.wsj.com/articles/cruise -lines-are-urged-to-cut-fuel-emissions-1426090406.

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Applying Cold-Ironing Regulation 311 cleaner fuel in October 2016.31 Figure 5 shows the sulfur limits for fuel at some of the busiest ports in the world; these numbers correlate almost perfectly with the sulfur oxide emissions in Table 2.32 Cleaner fuel (low sulfur) and emission control (scrubbers) are the most common and practical techniques to reduce vessel emissions while in port. Cold ironing is superior due to its ability to nearly eliminate sulfur oxide emissions and drastically reduce carbon dioxide emissions at a local level, regardless of regulatory differences. Further, with the introduction of standard cold ironing technology, operators will no longer have to adhere to a complex menagerie of fuel and scrubber requirements. To be sure, other methods to reduce emissions while at sea, including reducing speed and advanced emission control systems, can complement the reduction at port using cold ironing. The biggest concern preventing vessel operators and ports from immediately implementing cold ironing is the upfront cost. Though cold ironing is the superior abatement method for most ports, it is expensive. While its operational costs are substantially less than low sulfur fuel, the capital costs are half as much as scrubbers. Scrubbers have nearly zero operational costs, while

Table 2 Proportional emissions by Port

Top 10 ports Share of total Top 10 ports Share of total (CO2 emissions) (SOx emissions)

1. Singapore 5.9% 1. Singapore 6.5% 2. Hong Kong 2.2% 2. Hong Kong 2.3% 3. Rotterdam 2.0% 3. Port Klang 2.2% 4. Port Klang 1.9% 4. Tianjin 2.1% 5. Tianjin 1.8% 5. Shanghai 2.0% 6. Shanghai 1.7% 6. Fujairah 2.0% 7. Fujairah 1.7% 7. Busan 1.7% 8. Busan 1.4% 8. Kaohsiung 1.6% 9. Kaohsiung 1.4% 9. Ulsan 1.0% 10. Antwerp 1.2% 10. Beilun 0.9% Total Top 10 19.0% Total Top 10 22.3%

31 See discussion of Shenzhen port’s new low sulfur fuel requirements, and the timeline behind implementation, available at http://fairplay.ihs.com/ports/article/4275971/ vessels-berthed-at-shenzhen-required-to-burn-low-sulphur-fuel-since-oct-1. 32 Ibid.

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312 Monacelli the operational costs for cold ironing include the cost of buying power from the port. Again, individual cost-benefit analyses for unique ports are integral in determining the short term viability of cold ironing in lieu of stronger regulations. Until port states implement strict controls, like the U.S. in la/lb, cold ironing may remain prohibitively expensive. vii Regulatory Approaches

Ports in the United States and Europe leverage a variety of regulatory and legal tools to encourage cold ironing as a means to reduce emissions. The efforts can be grouped in three broad categories: port state controls, flag state controls, and international standards. Each group is discussed below, with the benefits and costs for each. Ports in Southeast Asia have the unique ability to use any combination of the three types of regulation as the landscape is clearer today than it has ever been.

1 Port State Controls The first method of regulation is port state controls. An example of this type of approach to cold ironing is the la/lb case study. Other ports, including Seattle, Rotterdam, and Miami, required that certain vessels have cold ironing capability to moor and conduct business. In la/lb’s case, the port invested in infrastructure to supply electricity, mainly due to strict California air quality standards.

(1) Benefits The primary benefit of using port state authority is that ports have nearly un- limited control over what happens in their port, and have the ability to regulate activity tied to the port. Another benefit is that, due to the inter-connectedness of the maritime transportation industry, once a large port introduces such controls, any ship that needs to use that port will be equipped with the technology. It is easier for other ports to introduce cold ironing regulations, since many ships will already have the capability and the initial capital investment is minimized. la/lb completed a comprehensive cost benefit analysis, which found that cold ironing would have the most significant emissions reductions for ships that spend a long time in port.33 When the study was completed in 2004, ships

33 ‘Cold Ironing Cost Effectiveness: Port of Long Beach,’ Environ International Corporation (Los Angeles, 30 Mar 2004), available at http://www.polb.com/civica/filebank/blobdload .asp?BlobID=7718.

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Applying Cold-Ironing Regulation 313 were smaller than today. With the increased size of modern container ships, they will be able to carry more cargo, and will spend more time in port loading/ offloading. The cost effectiveness from 2004 indicates that as ships stay in port longer, the benefits of cold ironing are greater for today’s megaships.34 For example, a container ship that makes a regular route around the Pacific Ocean will need to install cold ironing technology to use the port of la/lb. That same vessel, which may make calls in Southeast Asia, will already have the technology when other ports move to implement regulations. The mar- ginal cost of compliance is less, and industry opposition is minimized. In the case of Pacific Ocean routes, since many vessels already have, or will soon be required to have cold ironing technology because of la/lb, Southeast Asian ports are in a prime position to implement regulations.

(2) Costs The primary cost of port state controls is the initial investment required for ports to install cold ironing infrastructure. Where other incentives apply, including clean air regulations, the cost is less imposing. However, where national policy does not strongly favor clean air standards yet, as in China, there is less incentive to reduce emissions from ports. Other potential costs include reduced maritime traffic, especially if port state regulations are too strict or applied too quickly. The la/lb case study presents a method of success, phasing in cold ironing over a 16 year period with an end goal of 80% use. While other ports have not implemented cold ironing yet, if most of their current vessel traffic is not already outfitted for cold ironing, the cost of compliance may drive business elsewhere. Most of the world’s largest ports are in Southeast Asia. These ports, including Singapore and Shanghai, could exercise substantial market power if they implemented port state controls. While the Port of la/lb is large relative to the United States, the large Asian ports dwarf la/lb’s capacity. The cost of implementing cold ironing infrastructure at these mega ports would similarly dwarf the cost in the la/lb example. Still, using Los Angeles as an example, large Southeast Asian ports could begin by installing the necessary technology in a few berths, as a means of testing cold ironing’s viability and the market’s response.

2 Flag State Controls Flag states can exercise their unique ability to regulate their vessels operating around the world. Without going into the issues surrounding differences between flag state enforcement, it is important to highlight that a responsible

34 Ibid.

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314 Monacelli flag state can wield substantial power in reducing emissions. One of the most effective and popular forms of flag state regulation are incentive programs designed to encourage operators to install cold ironing equipment.

(1) Incentive Programs Perhaps one of the best cold ironing incentive programs comes from the European Union. While the eu is not a flag state per se, its member countries are flag states, and they participate in the incentive program for their flagged vessels. The popular program for subsidizing cold ironing technology on eu-country flagged vessels is tied to the ten-t (trans European transport net- work) policy.35 The ten-t policy is aimed at providing funding for a clean, sustainable, interconnected transportation channels in Europe. Established in 2006, the program supports building and modernizing the eus transportation infrastructure to be more sustainable.36 eu member countries are able to use the special ten-t funding to build out costly cold ironing shore side infrastructure. It is one of the primary rea- sons that ports in Europe are quickly implementing cold ironing technology. The concept is similar to the subsidies used to lower the effective cost of solar panels, to make clean energy a more attractive option compared to traditional, dirtier means of generating electricity. In the eu, where shipping accounts for more than 15% of its greenhouse gas emissions, regulators and citizens appreciate the effort.37 Nearly a third of those emissions, or 4% of the eus total, are attributed to ships while in port.38 eu leaders recognize the importance of reducing emissions in port wher- ever possible, and its ten-t funding scheme provides the means. As energy production in Europe becomes cleaner, the pressure to use more cold ironing increases. Successful ten-t projects include the Belgian port of Flanders. The project, which included upgrading the port with cold ironing infrastructure, cost € 2,244,000. ten-t funding accounted for half of the overall project cost.39 The ten-t incentive program can also be used by vessel operators to sub- sidize the cost of installing onboard cold ironing equipment. By incentivizing their vessels to adopt cold ironing technology, flag states can make a difference

35 See overview of the eu ten-t program available at http://ec.europa.eu/transport/ themes/infrastructure/ten-t-guidelines/transport-policy_en. 36 Winkel, Johnsen, Hoen & Papaefthymiou, ‘Potential for Shore Side Electricity in Europe: Final Report,’ ecofys, 2015, available at http://www.ecofys.com/files/files/ecofys-2014 -potential-for-shore-side-electricity-in-europe.pdf. 37 Ibid. 38 Ibid. 39 Ibid.

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Applying Cold-Ironing Regulation 315 in reducing emissions. Further, once the equipment is installed, the vessels will use it at ports around the world, since the operational cost of purchasing clean energy from the shore is oftentimes more cost effective than burning bunker. In the case of Southeast Asia, its countries do not represent as much registered tonnage as the eu.40 With 205 million gross registered tons, eu flag states represent approximately 20% of the world’s gross tonnage.41 Three Southeast Asian countries register in the top ten for gross tonnage, though combined only account for 176 million gross registered tons.42 To further complicate mat- ters, the countries of Southeast Asian are not as closely aligned as the eu, and devising a successful joint incentive program for cold ironing technology may be difficult. Individually, large players such as Hong Kong or Singapore could take unilateral action to reduce emissions. While not as impactful as the eu’s program, the results would be impactful, and could encourage other programs throughout the region.

3 International Standards (1) imo The imo took the first steps towards normalizing cold ironing in 2013 by work- ing to publish the first relevant ieee standard. The description, standard iec/iso/ieee 80005–1:2012, solidifies the universal concepts of hvsc (de- scribed above), which had become the de facto standard amongst interested mariners. The standard is comprehensive, and meant to be scalable, yet compatible across a variety of vessel types and port configurations. Though it evolved in a way contrary to other standards, (those that are published before widespread adoption) 8005–1:2012 provides the necessary guidelines for both vessel operators and port authorities. It is an example of the imo realizing the importance of cold ironing as an emissions abatement tool, and sets the stage for imo regulations aimed at enforcing the standard.43 The next step is for imo members to set regulations on using hvsc. Though no regulations are yet in place, imo discussions have centered on attaching

40 See the United Kingdom’s government report on the status of the world’s merchant fleet tonnage, available at https://www.gov.uk/government/statistical-data-sets/fle05-world -fleet-registered-vessels. 41 Ibid. 42 Ibid. The three Southeast Asian counties in the top ten are Hong Kong (76.5M tons), Singapore (59.2M tons), and China (38.8M tons). 43 See the imo training materials on ship and port energy efficiency, available at http:// www.imo.org/en/OurWork/Environment/PollutionPrevention/AirPollution/Docu ments/Air%20pollution/M5%20Port-Ship%20interface%20IMO%20TTT%20course%20 presentation%20final1.ppt.

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316 Monacelli cold ironing requirements to marpol Annex vi. marpol can serve as an effective framework to answer questions including when ships may be exempt from using cold ironing, and what types of power must be available at the port to make cold ironing beneficial.44 Southeast Asian countries, representing significant amount of merchant tonnage, have substantial influence in the imo and proposed regulations. By welcoming cold ironing regulation as a means to reducing emissions through the imo, Asian member countries can ensure that merchant fleets quickly adopt cold ironing technology and methods. The sooner that regulations are in place to enforce the existing standards, the quicker that ports around the world will see the benefits of reduced vessel emissions, just as in the success stories of Rotterdam, la/lb, and Seattle. viii Conclusion

The impact that cold ironing technology has on reducing shipboard emissions is undisputed. Regulatory and political environments in the eu and United States increased the adoption speed for cold ironing at their ports, although ports around the world are starting to implement their own cold ironing plans. Although cold ironing will not solve vessel emissions and is only one of many possible abatement methods, it continues to shine as the gold standard where clean electricity is available. Southeast Asia is home to some of the most polluted ports in the world, due in no small part to the massive volume of shipping traffic. By looking to ports like Los Angeles, Seattle, and Rotterdam, Asian ports have a model that planners can use to scale cold ironing technology to meet their own requirements. The impact that shipboard pollutants have on human health is direct and fatal. More and more vessel operators recognize that cold ironing also has the potential to reduce operating costs. The benefits of cold ironing are increasing as the world continues to shift towards renewable, sustainable electricity generation. It is time that regulators and planners should look to increase the capability at their ports. While the task of implementing cold ironing technology at massive Asian ports is no small feat, it may be necessary if ports want to minimize or eliminate the harmful effects of shipboard emissions in port. With worldwide shipping expected to increase dramatically, taking action now will prevent larger and more expensive efforts in the future.

44 Ibid.

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