White paper

Delineating a Chinese emission control area: The potential impact of ship rerouting on emissions

As China tackles its air quality issues, government regulators have turned their focus to shipping, an industry that burns thousands of tons of highly polluting heavy fuel oil near densely populated coastlines every day. One way to reduce air pollution from ships is by establishing an Emission Control Area (ECA), a geographic region designated by the International Maritime Organization where more stringent emission standards apply. China has already implemented domestic emission control areas in three port clusters along China’s coastline, although they are smaller and currently have less stringent standards than an IMO ECA.

What should a future IMO ECA look like? A delineation closer to shore is politically easier to achieve because China can unilaterally regulate ships in its territorial waters. However, a narrow ECA delineation may actually increase emissions if ship operators divert around the ECA to save on fuel costs, as ECA-compliant fuel is more expensive than traditional marine fuel. Therefore, China should consider how to delineate an ECA to prevent rerouting and ensure maximum emission reductions and public health benefits.

In this paper, we quantify the emissions reduction potential of four ECA delineation scenarios, considering the potential for ships to route around the ECA. We found that:

1. An ECA needs to be at least 100 nm from the coast to be most effective. Under a narrow ECA, ship operators may reroute some of their heavily frequented coastal voyages around the ECA to save money on fuel. The closer the ECA boundary is to the coast, the more ships will reroute. Therefore, narrower boundaries undermine the effectiveness of the ECA.

2. When ships bypass the ECA zone, they avoid environmental regulations, redistributing rather than reducing emissions. Worse, rerouting results in a modest (up to 2%) increase in fuel consumption compared to shorter, more direct voyages because rerouted voyages cover longer distances and, in some cases, require ships to speed up (and burn more fuel) to stay on schedule.

3. The more expensive ECA-compliant fuel is compared to globally compliant fuel, the more ships will reroute. Indeed, the decision to reroute is sensitive to bunker fuel prices. The larger that price differential, the wider the ECA boundary needs to be from shore to discourage rerouting.

The share of sulfur oxides that ships emit within 200 nautical miles covered by an emission control area
The share of sulfur oxides that ships emit within 200 nautical miles covered by an emission control area.