Baltic Exchange has introduced a series of green fuel options to its FuelEU voyage and compliance cost calculator as more shipowners, traders and charterers seek to understand the commercial implications of this regulation on their voyage costs.
Biodiesel, bio-LNG, bio-LPG, green methanol, green hydrogen and green ammonia have all been added to the calculator, either as green fuel or blend options.
Overview of the cost implications
Baltic Exchange’s FuelEU Maritime calculator provides an overview of the cost implications
Baltic Exchange’s FuelEU Maritime calculator provides an overview of the cost implications for the selected option relative to the Baltic standard for that route.
This will enable the market to factor any change in fuel selected or contemplated into their voyage cost estimates.
New FuelEU Maritime regulation
“Green fuels are expected to be very expensive initially, so will likely be blended into fossil-derived fuels initially, to achieve compliance with the new FuelEU Maritime regulation."
"For this reason and based on industry feedback, we have added a blend capability to Baltic Exchange’s FuelEU compliance and fuel cost calculator,” said Martin Crawford-Brunt, Emissions Lead at Baltic Exchange.
Baltic standard ship and route types
These results of the measures are all presented relative to the Baltic standard ship
“Baltic Exchange is assisting the market by cutting through the considerable complexity of these regulations by providing a simple decision-making tool that estimates the voyage costs of the many fuel and blend alternatives quickly and simply,” he added.
These results of the calculations are all presented relative to the Baltic standard ship and route types, which is generally considered to be burning VLSFO in navigation outside ECA and MGO for waiting and port consumption.
Speeds and consumptions of the test ship
The output from these calculations shows the cost differential for the fuel under consideration with the entered speeds and consumptions of the test ship versus the market standard.
For example, a 115,000 dwt LR2 clean tanker operating on the TC20 Baltic route (Al Jubail – Rotterdam), assuming a standard speed of 11 knots with ballast consumption of 21 mt/day and laden consumption of VLSFO of 27 mt/day, stands to save nearly $30,000 in fuel costs if using a 35% B100 blend option.
Ratio of biodiesel
The vessel stands to save increasing amounts of costs on fuel as the ratio of biodiesel to VLSFO increases
Despite an increase in overall fuel costs, the amount saved for being in compliance with the FuelEU Maritime regulation will offset those costs and provide additional savings compared to burning purely VLSFO.
According to Baltic Exchange’s FuelEU Maritime Calculator, in this example, the vessel stands to save increasing amounts of costs on fuel as the ratio of biodiesel to VLSFO increases.
Fossil-derived versions
In addition, the table below shows the voyage cost outcomes for the same vessel and route depending on which green fuel is blended into VSLFO at 10%.
These calculations are made with the assumption that these green fuels cost twice as much as their fossil-derived versions, which make up the remainder of the fuel burned on the round voyage.
FuelEU Maritime-related savings
FuelEU Maritime-related savings of using bioLNG results in more than $400,000 in overall savings
In this example, bioLNG offers the most cost-effective option as a fuel blend. While it has a higher overall cost compared to ePLG or B100, the FuelEU Maritime-related savings of using bioLNG results in more than $400,000 in overall cost savings.
“With the latest update to Baltic Exchange’s FuelEU Maritime Calculator, users now have the ability to experiment with any green fuel blend percentage taking into account the assumed green fuel cost premium and the expected well-to-tank emissions profile for the specific green fuel blend selected,” Crawford-Brunt noted.
FuelEU Maritime and EU ETS
“Regulations like FuelEU Maritime and EU ETS will become increasingly impactful on voyage costs to and from the EU. All contracting parties, their brokers and traders need to be able to estimate these additional costs quickly to avoid facing high financial penalties."
"Baltic Exchange is pleased to be able to offer these vital emission resources and tools to its members and the wider market as we all strive for a more sustainable future for shipping,” he added.
