Green Harbours: Strategies For Reducing Marine And Port-Related Emissions In Hong Kong And The Pearl River Delta

Green Harbours: Strategies for Reducing Marine and Port-related Emissions in Hong Kong and the Pearl River Delta

Background The Pearl River Delta (PRD) ports, which include Hong Kong and East and West Shenzhen, and associated logistics services handle the world's largest number of containers and, as they are located in high population areas, have a corresponding responsibility to minimise toxic air emissions as far as practicable. But nothing is being done in Hong Kong or in the other parts of the PRD. Other ports and regions, particularly in Europe and the US West Coast, have taken a pro-active response to port- related air emissions through legislation, voluntary incentives or a combination of both.

Recent research by the Hong Kong University of Science (HKUST) and Civic Exchange has shown that the contribution of marine sources to local air pollution in Hong Kong is high, both in terms of the amount of time that it is the dominant source of local pollution, and in terms of its effect on public health. In 2006, shipping (in combination with local road traffic) was the dominant source of air pollution in Hong Kong on 121 days of the year (i.e. 33% of the year).1

In addition, because combustion and emission of high-sulphur fuel by marine vessels takes place in close proximity to densely populated urban areas (an estimated 3.8 million people live in the urban air-shed directly affected by emissions from Hong Kong’s container port), the impact of these emissions on public health is likely to be more significant than the absolute volume of emissions would suggest.2 Without control measures (such as requiring ships to slow down in the harbour; use lower-sulphur fuel when close to land, etc.) the impact of marine emissions and the associated port-related emissions will increase along with the predicted increase in shipping traffic.3

The ratification of MARPOL Convention Annex VI4, which is the main international legal instrument dealing with air pollution from ships, would the be the first step in the regulation of marine fuels in Hong Kong and the Pearl River Delta (PRD) region. It would limit sulphur content of marine fuels to 4.5%, and would satisfy a precondition for application for a Sulphur Emission Control Area (SECA). Although Mainland China ratified Annex VI in 2006, Hong Kong is still in the review process and ratification is not expected for some time.

Only once Hong Kong ratifies Annex VI can Hong Kong and Mainland China submit a joint proposal to the International Maritime Organization (IMO) to have a MARPOL

1 Alexis K. H. Lau, Andrew Lo, Joe Gray, Zibing Yuan and Christine Loh, Relative Significance of Local Vs Regional Sources: Hong Kong's Air Pollution, Hong Kong: Civic Exchange, 2007, http://www.civic- exchange.org/publications/2007/airmarch.pdf. 2 Alexis K. H. Lau, Wai Man Wu, Jimmy C. H. Fung, Ronald C. Henry and Bill Barron, Significant Marine Sources for SO2 Levels in Hong Kong, Hong Kong: Civic Exchange, 2005, http://www.civic- exchange.org/publications/2005/MarineSO2.pdf. 3 For more information on Green Ports policy, see Marcos Van Rafelghem and Caitlin Gall, Marine Emission Reduction Options, Hong Kong: Civic Exchange, 2006, http://www.civic- exchange.org/publications/2006/marineemission-e.pdf. 4 International Convention for the Prevention of Marine Pollution from Ships, 1973 as modified by the Protocol of 1978 relating thereto and its associated Annexes.

Green Harbours - October 2007 1 Convention SECA designated in Hong Kong and Pearl River Delta waters. The designation of a SECA in Hong Kong and PRD waters would tighten the sulphur content of marine fuels to 1.5% and substantially reduce marine emissions in the region. However, the application of SECA, especially for a rapidly industrialising area such as the PRD, poses difficulties and is also a time consuming process which will involve strong cross border collaboration. While Hong Kong can take the lead to initiate and plan the process, longer term collaboration with Mainland China, particularly the administration in Guangdong, to implement marine and port-related emission initiatives is key. It is essential that a SECA application, if made, applies to the entire PRD; Hong Kong is concerned that the competitiveness of its port would be penalised if more stringent emission criteria is not the same for all PRD ports and terminals.

Operational Procedures This project will study legislation and voluntary incentives that are already in place in other parts of the world, assess their effectiveness, and recommend how they might be applied to the PRD ports and associated logistics services. By engaging stakeholders, voluntary incentives that are acceptable to the relevant industries can be developed and pressure can be applied to the relevant administrations so that legislation can be introduced and a level playing field is developed.

Project Objectives  To build buy-in for dramatic improvement in reducing marine and port-related emissions.  To develop voluntary incentive scheme for deep sea operators and ports, and environmental charters to reduce emissions from the ports both in Hong Kong and the PRD.  To persuade the HKSAR Government to develop a green port policy and ratify MARPOL Annex VI.  To outline necessary short, medium and longer steps including the creation of a SECA for the PRD region.

Activities a. Research: In 2006 Civic Exchange produced a study on Marine Emissions. This research will be updated in order to focus on voluntary incentives and regulatory approaches that are being adopted in other ports. In addition to desk top research, this study will use interviews to explore how industry around the world has responded to voluntary programmes and award schemes and to examine what would encourage both international and Hong Kong companies to adopt a similar approach in Hong Kong and the PRD. The research phase will be used to get an idea of the scale of the problem and the willingness of stakeholders to participate in a voluntary scheme. b. Engagement program: The project will actively engage the relevant stakeholders - including the ocean going vessels (deep sea) operators, local river transport operators, port operators and truck operators - in discussion through a series of meetings. The project will encourage local and regional action and help to foster more cross boundary exchange on green shipping. This step in the project will

Green Harbours - October 2007 2 require the involvement of senior and experienced individuals from the Civic Exchange team in small meetings and workshops that will be held with the managing director level personnel among the stakeholders. Civic Exchange has received support from the Hong Kong Ship Owners Association (HKSOA), as well as some ship and port operators and will use these associations to build further support. Small workshops, each with a unique dynamic, will be conducted with the various stakeholders to build buy-in, and the findings from these workshops will be used to conduct a larger workshop.

Stake holders Deep sea ships that call at PRD ports and terminals. Some members of this group are likely to be more open to a discussion as their ships that sail across the Pacific and to Europe will probably already comply with voluntary incentives and regulations in US and EU Ports.

Local river transport include ferry and tug boats operators who will be aware of what is taking place elsewhere but will be concerned about costs.

Port operators in Hong Kong and the PRD. HK terminal operators will be responsive as some are already looking at their environmental footprint and are taking steps in their terminals on the Mainland to reduce their footprint.

Trucks and other land transport are responsible for a large percentage of the port- related traffic and emissions. These operators are represented by a very strong lobby and will be concerned that they are being penalized. Cooperation between Hong Kong and the Mainland will need to be examined as well as possible regulatory measures.

Local Authorities A key part of this project will be to engage relevant policy-makers and partner organisations across the region. Experience shows that both Hong Kong and Guangdong Governments are much more willing to support projects that are up and running, rather than during the initial stages. The aim is to gain government support during the preliminary stages of work. A longer term aim would to have the various cross-boundary bodies for the Governments of Guangdong Province and Hong Kong, which discuss matters of mutual concern including economic matters, infrastructure needs and environmental issues, to include green shipping as an important part of their on-going discussions. c. Large Workshop: The workshop will bring together all the relevant stakeholders to explore a local and eventually a regional programme for reducing marine emissions. The aim is for the participants to outline next steps, explore what voluntary methods can be started and develop a detailed plan of action. The successful implementation of a voluntary programme requires relevant stakeholders being involved in their development and implementation. Participation of overseas port management experts (funding permitting) to share with Hong Kong what is being done in Long Beach/LA and in Europe will be encouraged. d. Dialogue with Government: Discussions will also be held with government officials to persuade them to explore a green port policy and make it a matter of priority.

Green Harbours - October 2007 3 Government and Legco representatives will be introduced to what is being carried out elsewhere, the steps Hong Kong and the PRD need to take and will be presented with the findings for the engagement activities and final report. e. Public Engagement: The results of the research and engagement exercise will be used to develop a voluntary incentive program that ship owners are willing to comply with. The program and the findings of the study will be publicly released to gain public support.

Timeline: Activity Milestones Timeframe Conduct desktop research Draft report, interview write ups and 1st and 2nd month and interviews identification of key stakeholders for small (October – workshops November) Small workshops for Build buy in and produce a record of 3rd and 4th month stakeholders including the port engagement discussions findings to be (December- operators. used for larger workshop. January) Large workshop Outline the necessary steps for 5th month developing a voluntary programme and (February) ensure endorsement from stakeholders. Productions of draft final report for discussion. Government Dialogue Presentation of the findings to the HKSAR 6th month Government (Environmental Protection (March) and Marine Departments) and the Hong Kong Legislative Council Environmental Affairs Committee and other relevant committees.

Public release Final report and press conference. 6th month (March)

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