Sulfur emission reduction in cargo ship manufacturers and shipping companies based on MARPOL Annex VI

TL;DR

This paper examines the economic and operational challenges faced by ship manufacturers and shipping companies in adopting sulfur emission reduction technologies under MARPOL Annex VI, highlighting cost implications and strategic considerations.

Contribution

It analyzes the financial and logistical challenges of implementing scrubbers and low sulfur fuels in maritime industry, providing insights into technology adoption strategies.

Findings

Ship manufacturers face increased costs due to new technology adoption.

Shipping companies must tailor technology choices to navigation areas and trade routes.

Adoption of emission reduction technologies impacts ship pricing and operational strategies.

Abstract

This article explores the challenges for the adoption of scrubbers and low sulfur fuels on ship manufacturers and shipping companies. Results show that ship manufacturers, must finance their working capital and operating costs, which implies an increase in the prices of the ships employing these new technologies. On the other hand, shipping companies must adopt the most appropriate technology according to the areas where ships navigate, the scale economies of trade routes, and the cost-benefit analysis of ship modernization.