The use of low sulphur fuel and its effect on shortsea shipping between the North Sea ports and Southern Europe

The aim of this research is to analyse the impact of the Marpol Annex VI1 amendment on (SSS) between the three major North Sea ports and Southern Europe. The transport network analysed in this research include the port of Antwerp, Hamburg, Rotterdam and their relation with France, Greece, Italy and Spain. The research is segmented using three modes of transport; SSS, road and rail transport. The regulations imposed by the International Maritime Organization (IMO) limit the degree of sulphur content in fuel used by vessels. For the predefined Sulphur Emission Control Areas (SECA) are these sulphur content limits lower than compared to the average limit for the international waters. The SECA’s include the North Sea, English Channel and Baltic Sea. Although the Mediterranean region is not yet subject to these regulations, it is can be assumed that this will change in the future to support an equal competitive maritime industry. (Panagakos et al, 2014) The relation between the European ports and the Mediterranean region for SSS is important with a share of 29% in the overall SSS throughput. (Eurostat, 2014) Starting in January 2015, the sulphur limit for SECA’s will be reduced from 1.0% to 0.1% per mass. (IMO, 2014) As a consequence, the currently used heavy fuel oil (HFO) is not allowed in the SECA areas anymore. Companies sailing in these areas should find an alternative for HFO, this research will review the impact of switching to low sulphur fuel oil (LSFO). The use of LSFO will increase the bunkering costs for the ship owners, who will in turn increase the freight rates of all maritime transport subject to this, to recover these costs. Based on related academic research and data, the methodological approach to estimate the impact will be a Global Simulation Model (GSIM). The outcome of the model is in line with the reasoning of other researchers confirming a modal backshift from SSS to especially road transport. Remarkable is the result for Rotterdam, where a large modal backshift occurs. Furthermore the results indicate that the port of Hamburg will substitute the ports of Antwerp and Rotterdam. The decrease in SSS is variable within a range from -20 to 64% for the OD relations between the North Sea port and the Southern European countries.