Green Ship Incentive Program at POLB

MSC's " Bilbao " at Port of Long Beach

For the past six months, the Port of Long Beach has been offering financial rewards to ocean carriers who bring their Tier 2 vessels to Long Beach as part of an environmental program designed to attract the world’s greenest ships. Companies get $2,500 for every Tier 2 vessel they route to the Port, but only about 40% of qualifying ships have claimed their rewards so far.

"Participation in our Green Ship Incentive Program is easy," says Don Snyder, Director of Trade Development. "Ocean carriers need only go to our website, register once, and furnish their taxpayer ID number. We do the rest."

Despite the simple process, about 60% of the $107,500 in qualifying rewards has gone unclaimed. Port officials believe part of the problem might be that carriers don't know the process is simple.

Port staff does all the tracking of eligible Tier 2 ships that call to its docks and write a check every quarter to qualifying shipping lines. Tier 2 ships are vessels whose engines meet the strictest, most up-to-date environmental standards, resulting in 15% lower nitrogen oxides emissions.

"I can't think of a reason a company wouldn't sign up," says Stan Kablick, Long Beach Operations Manager for Mediterranean Shipping Company, which has earned the incentive for its Tier 2 vessels, MSC Altair and MSC Flavia. "It's a win-win for everyone."

Kablick, who also heads MSC's West Coast operations, says the money amounts to a bonus for shipping lines already committed to greening their fleet. The process of ordering and acquiring new ships, including those with the Tier 2 engines that are required in all new builds after January 2011, typically takes about 10 years.

MSC's rewards are likely to grow as the company builds on its partnership with the Port by expanding container operations at Pier T. More importantly, Kablick says the program supports MSC's longstanding commitment to environmental stewardship.

"From the top down, we're mindful of certain duties and responsibilities we have to the communities in which we do business," Kablick says. "It's not about what we can get. It's about how we can give back."

At the same time, the incentive can be a factor in business decisions related to routing cargo, Kablick adds. "It always helps to have these sorts of programs."

Launched July  1, 2012, the Green Ship Incentive Program is the Port's latest effort to reduce vessel emissions. Although the Port has made dramatic progress in cutting air pollution from all port-related sources, including reducing diesel particulate matter emissions by 75% since 2005, ships remain the greatest source of harmful pollutants.

The Port offers an even higher incentive to shipping lines that deploy the next generation of clean ships before they are required by international regulations. Tier 3 vessels ? ships with engines that cut NOx emissions 80% ? earn $6,000 per vessel call. Tier 3 ships have yet to enter the world fleet, but such engines will be required on all new builds after Jan. 1, 2016.

Nowadays, going green must make financial sense and the Green Ship Incentive Program more than measures up. For Tier 2 ships, the program costs $6,515 per ton of NOx emissions eliminated ? more than 60% less than the $17,080-per-ton California deems reasonable for cutting NOx emissions.

Since the incentive program's debut, approximately 5% of all vessel calls to the Port have been from Tier 2 ships. That's 45 ship calls from July to December ? more than six times the number of Tier 2 ships that called at the Port throughout 2011.

The Port hopes the 5% rate represents a baseline from which the number of Tier 2 ship calls grows as quickly as possible.

"We set aside $295,000 in incentive money for the first year," Snyder says. "We want to spend every dollar because the clean air returns are priceless.” < Korea Shipping Gazette >