The Need to Reduce Vessel Fuel Consumption
Dec. 18, 2019
On January 1, 2020, the new IMO 2020 regulation to reduce pollution from sulfur oxide (SOx) emissions produced by heavy bunker fuels goes into effect. Ocean carriers will need to use more costly, very low sulfur fuels with a cap of 0.5% of sulfur compared to today's standards of 3.5%. They may also use scrubbers to retrofit existing vessels and cleaner alternative fuels such as liquefied natural gas (LNG).
As bunker fuel costs increase for ocean carriers, conserving as much fuel as possible while maintaining schedule reliability for shippers will be critical for carriers. Conserving fuel not only saves costs, it minimizes emissions and the impact on the environment in the shipment cycle.
At the heart of this challenge are the ocean carriers’ marine operations departments and their coordination with terminals and sea captains. To explore the role marine operations has in making decisions that impact ocean carriers' fuel consumption, we spoke with Ralph Ho, senior product manager of CargoSmart, who has been working with marine operations managers to pilot an application to optimize vessel operations.
What factors go into the amount of fuel consumed?
The primary factors are the size of the vessel, the speed of the vessel, and the length of its journey. Mega vessels require more fuel than smaller vessels to operate. At the same time, the slower a vessel moves, the less fuel it consumes, relative to its size.
The path a vessel takes determines its fuel consumption as well. If it veers off course to avoid a storm and goes against strong currents, it will consume more fuel than if it follows a direct path.
A vessel can also consume high volumes of fuel while idling at its destination if it has missed its scheduled berth window due to arriving late and port congestion.
What are some ways that carriers save on fuel consumption?
Carriers can determine the lowest possible speed and most direct path for a vessel to travel safely to meet its scheduled berth window. However, more factors come into play when simulating the optimal speed for a vessel.
Using the Automatic Identification System (AIS) and published sailing schedules, marine operations teams can monitor all incoming vessels and their expected arrivals at a port. Some ports are first-come, first-serve, so it's critical to arrive first for a scheduled berth time and it may be better to speed up to arrive first to avoid a long wait for the next available berth time. On the other hand, if they see port congestion at a terminal, the carrier can work with the terminal to update the berth window time and slow the vessel down to not rush to the port and conserve fuel.
Adding to the complexity, carriers often work with alliance partners for transshipment connections. Having visibility to partner carriers' schedules and actual vessel locations can help carriers predict more accurately their arrival time while minimizing fuel consumption for critical transshipments.
Analyzing the factors that impact fuel consumption and running simulations allow marine operations to work closely with terminal operators for identifying just-in-time arrival opportunities and quick replaning of vessels. The analyses ultimately optimize both fuel consumption and port operations.
In conclusion, vessel operators want shorter waiting times, just-in-time berth arrivals, reduced speed while maintaining schedule reliability, as well as coordination with connecting vessels. Improving vessel and port optimization based on schedules can go a long way to achieving these goals and consuming less fuel. Using AIS, schedule data, and predictive ETAs, carriers can run simulations based on multiple factors to see the big picture and calculate the optimal path and speed to save fuel costs and reduce the impact on the environment.