Potential Risks of Waiting Too Long for Scrubber Installation

Low Sulphur Fuel or Exhaust Gas Scrubber
Compliance Duel: Low Sulphur Fuel or Exhaust Gas Scrubbers?
August 10, 2020
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With the global Sulphur Cap 2020 right at the horizon, pressure on ship owners and ship operators to find ways to comply with the new IMO regulation is mounting at an exponential rate. Your decision can be one that puts you at the mercy of higher fuel prices or one that retains your competitive power.

Out of the limited viable options to comply with the global emission limit, scrubber Installation is turning out to be a favourite due to cost and convenience. The payback period for a scrubber can be as low as less than a year depending on the vessel size. However, there are still some ship owners who are not sure if scrubbers are the right long-term solution for them.

What Happens When You Delay Scrubber Installation?

1. Lower Return on Investment

Looking at the average between the highest 400$ initial price difference between MDO and HFO and the lowest-the current projection of forwards of 250$ means that most ship owners will profit from taking an early decision. The Return on Investment (ROI) for installing a exhaust gas scrubber system in 2020 in comparison with doing the same either in 2021 or 2022 is significantly higher. The longer one waits to get scrubbers installed, the longer the payback period will be.

2. Unnecessary high fuel cost

Replacing the current bunker fuel is an expensive process. Low Sulphur fuels are costlier and a whole new fuel-system has to be installed to make ships sail efficiently. With exhaust gas scrubbers, ships can continue to run on the cheap bunker fuel and the existing ship fuel tanks do not need to be cleaned. This would help the ship-owners in reducing the cost involved in switching to expensive low-Sulphur fuel, which has a higher OPEX at over $250 /tonne and a CAPEX of approximately $500k per vessel.

3. Shipyards capacity gets lower

Making a last-minute business decision is very risky. Installation spaces at the shipyards across the globe are likely to tighten in the years after 2020 as more ships opt for EGCS retrofit. Some shipowners believe that the perfect time to get scrubbers installed is right at the end of 2019 which is easier said than done. As 2020, approaches, the whole supply chain will be under a lot of pressure and last-minute orders will be very hard to accommodate. Scrubbers are most often made to measure for a specific ship, and the lead times can be long and getting the systems commissioned and class approved takes time.

Make the right compliance choices now with Kamelia Cleantech Scrubbers

The technology and supplier you choose can make the difference between bare-minimum compliance and truly keeping ahead. While there are multiple strategies available to comply with the regulation, scrubbers provide an excellent balance between complying and operating economically. For smooth installation and reliable compliance, you need not only the right scrubber system but also the right supplier.

With Kamelia Cleantech, you won’t have to worry about the shipyard installation capacity as our scrubbers can be installed on-voyage with typically only 1 week of downtime for the vessel. Our Open-Loop, Hybrid-ready and Hybrid Scrubbers are manufactured with advanced control systems based on Marine Artificial Intelligence (AI) and one-touch operations, which help the ship operator to decrease OPEX. Prior to giving a quote, we determine the most economical solution based on the vessel machinery, layout and operation route to provide the appropriate type of scrubber system.

To learn more about the scrubber technology and the best options, contact the Kamelia Cleantech team.


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