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T&E releases cost analysis of Arctic HFO ban for cruise shipping

11 Oct 2018

A report to understand the likely cost impact of an Arctic heavy fuel oil (HFO) ban on the cruise industry and passenger ticket prices has been published by the European Federation for Transport and Environment (T&E).

The Cost Analysis of Arctic HFO ban for Cruise Shipping report pointed out it would cost passengers just the price of a glass of wine a day if cruise ships would stop burning HFO in the Arctic.

It analysed the impact on the cruise ship MS Rotterdam if it had switched to marine gas oil (MGO) during three summer trips to the Arctic in 2018.

Banning the use of HFO in the Arctic would have increased ticket prices on the MS Rotterdam by on average 6%, based on 2018 fuel prices and assuming the additional fuel costs incurred were passed on to passengers.

The added cost equates to an additional €7 a day on ticket prices – or no more than the price of a glass of wine onboard the MS Rotterdam, which is owned by Holland America Line.

“Arctic cruise tourism is booming, increasing the risks of oil spills and creating more pollution,” says Lucy Gilliam, Shipping Officer at T&E.

“The costs per passenger of a switch to cleaner fuel are tiny. It’s more than worth it to reduce the risks to the unique environment that passengers are paying to see.

“Cruise companies claim that an HFO ban would be a death sentence to their industry yet the figures show that the costs passed on to passengers are trivial. Cruises to the Arctic are, by any measure, a luxury yet tickets are VAT exempt.”

Last April, the IMO agreed to move forward on developing a ban on HFO from Arctic waters on the basis of an impact assessment.

Currently, the IMO is inviting submissions on how to assess the impact of the HFO ban on communities and operators in the Arctic. It will be discussed during the next marine environment protection committee meeting (MEPC 73) in London in October.

The full report of Cost Analysis of Arctic HFO ban for Cruise Shipping is available for download here.

Photo credit: European Federation for Transport and Environment 
Published: 11 October, 2018


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