Canadas Experience with the North American Emission Control

Canada's Experience with the North American Emission Control Area NAMEPA 2014 World Maritime Day Observance Cozumel, Mexico RDIMS # 10036177

Overview • • Background, What was the problem? Making the case for an Emission Control Area Stakeholder concerns Proposal to International Maritime Organization (IMO) Ratifying MARPOL Annex VI Domestic implementation Results so far Next steps 2

Background: What was the problem? • Emissions of sulphur oxides contributed significantly to overall air pollutants and health impacts • A key source of sulphur oxide emissions is sulphur in fuel • Fuels used by other modes had been significantly reduced under their respective regulations. 2002 2020 Modelled SOx Emissions • Under regulations, sulphur oxides emissions from ships would grow to be the majority of transport emissions of sulphur oxides 3

Making the case for an Emission Control Area (ECA) An ECA requires an amendment to Annex VI of the International Convention for the Prevention of Pollution from Ships (MARPOL) • 2006 agreement with US at head of state level • Follow criteria of Appendix III, Annex IV to MARPOL • Environment Canada carried out modeling of emissions and their deposition over Canada • Health Canada carried out assessment of public health impacts based on above modeling 4

Modelled ship traffic 2008 5

Modelled nitrogen oxides emissions 6

Impacts of sulphur oxides • Marine emissions contribute to smog levels (O 3 and PM 2. 5) in all Canadian provinces where there is commercial marine activities (BC, Ontario, Quebec, Maritimes) • Large portions of the Canadian population and ecosystems are affected by air pollution associated with marine transportation. Influence of marine emissions on summertime ozone levels (top) and sulphur deposition levels (bottom) in Canada 7

The North American Emission Control Area 8

Proposal to the International Maritime Organization • Submission to IMO’s Marine Environment Protection Committee in July 2009 • Met in advance with European countries who had an ECA and with key flag States • Comprehensive proposal set out by Canada and the US • See IMODOCS MEPC 59/6/5, supplement by MEPC 59/INF. 13 • Worked with the US and France • joined the proposal for the islands of St Pierre and Miquelon • US led proposal as Canada was not a Party to Annex VI to MARPOL 9

Canada’s ratification of Annex VI to MARPOL • TC led an initiative to ratify a framework of IMO environmental conventions in 2010 • The package included • MARPOL annexes IV, V, and VI • Antifouling Systems Convention • Ballast Water Convention • Liability and compensation conventions • Ratification of Annex VI in March 2010 allowed Canada to • have effective options to enforce as a Port State • be a voting party on further measures under Annex VI • e. g. energy efficiency standards of 2012 10

Stakeholder views • International sector Accept the ECA, concern for fuel availability Ø TC worked with US on policies for fuel availability • Domestic sector Operate in the Great Lakes System; concern for fuel costs Ø TC negotiated alternative regime to address concerns • Cruise sector Continuously operate in ECA; concern for fuel costs Ø TC worked with US on alternative compliance regime • Ports and Port Communities Generally support ECA, concern for competition between ports for trade corridors and cruise destinations Ø Compliance alternatives for cruise sector available to others 11

Domestic implementation • Amendments to the Vessel pollution and dangerous chemicals regulations published May 8, 2013 • Consultations with stakeholders were key and identify concerns related to fuel costs and availability • Fleet averaging addressed domestic marine operators in Great Lakes and Seaway system • Alternative compliance addressed ocean going vessels and cruise sector 12

Regulations for the Great Lakes System Fleet targets for fuel sulphur content for domestic “laker” vessels compared to ECA • Canadian fleet undergoing renewal • The Regulations include significant flexibility based on discussions held with industry associations and individual firms operating domestic vessels in Canada • Compliance is assessed based on the average sulphur content in fuel used by a firm’s fleet rather than on an individual vessel basis. • Vessels built after December 31, 2008 get a 10% efficiency credit and vessels built after August 1, 2012, get a 20% credit. • Additional flexibility is provided to shipowners through the Marine Technical Review Board process. 1. 6% 1. 4% 1. 2% 1. 0% Flexible timeframe 0. 8% 0. 6% 0. 4% Short timeframe 0. 2% 0. 0% 2012 2013 2014 2015 2016 2017 2018 2019 2020 Domestic Lakers Other vessels (ECA) 13

Alternative compliance options • MARPOL Annex VI provides options to flag States under Regulations 3 and 4 for research into new technology and equivalent performance • Canada, the US and France are of the view flag States need to consult with ECA states prior to approving a measure under Regulation 3 or 4 • Flag States prefer to work with ECA states to ensure smooth implementation of such measures 14

Results so far • Canadian Great Lakes bulk carrier fleet to receive 15 new builds before January 1, 2016 • Other new builds planned for ferry fleet, over 25 new builds into 2020 • Fuel oil non-availability reports (FONAR) for both Canada and the US • Canada received to date some 30 reports on Atlantic coast and 15 on the Pacific coast. • Alternative compliance Scrubbers: • cruise sector 57 vessels • plus 38 vessels not under Regulation 3 exemptions LNG: • two vessels under permit, several planned 15

Timeline for IMO Air Emissions Standards 2011 • Global sulphur standard 4. 5% • European Emission Control Areas at 1% • New engines need to meet Tier II standards for NOx 2012 • January, global sulphur standard reduced to 3. 5% • August, North American ECA comes into force (1%) • NOx technology study begins 2013 • EEDI required for new ships • No EEDI reduction target • SEEMP required for all ships • NOx technology study due 2015 • All ECAs set to 0. 1% sulphur • EEDI target set to 10% 2016 2018 2020 2025 • All new ships operating in an North American ECA must meet Tier III NOx (If confirmed by study) • Study of supply of low sulphur fuels to be completed • Based on fuel study, global standard for sulphur reduced to 0. 5% • EEDI target set to 20% • Based on fuel study, global standard for sulphur reduced to 0. 5% • EEDI target set to 30% 16

Next steps • 0. 1 percent sulphur comes into effect January 1, 2015 • Compliance promotion, enforcement, detection, penalties • Trident alliance, informal discussions among ECA states • Managing scrubbers and LNG emerging • Alternative fuels still to be developed • Tier III NOx standards for North American and US Caribbean Sea ECAs enter into effect January 1, 2016 • New builds, re-powering, major conversions affected • January 1, 2020 global sulphur content standard of 0. 5%? • Study under preparation, due Jan 1, 2018 17

Questions Paul Topping Manager, Environmental Protection Transport Canada Marine Safety and Security paul. topping@tc. gc. ca THANK YOU! GRACIAS! 18