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Gothenburg to keep LNG discount at 20% in 2019

Sweden’s Port of Gothenburg

says it will keep its discount on port tariffs at 20% for LNG-fuelled vessels in 2019 before starting to phase them out in 2020 with a reduction to 10%.

Gothenburg to keep LNG discount at 20% in 2019

However during the phase-out period the Port Authority will focus on developing its regular indexed environmental discount, which takes greater account of the vessels’ overall environmental impact rather than the technology or the fuel used to run the vessel.

 

In 2015, the Port of Gothenburg introduced an environmental discount on the port tariff in an effort to increase the number of calls by ships running on liquefied natural gas (LNG). Several major LNG investments have been made since then, including initiatives by a number of Swedish shipping companies. This has had a positive impact on the environment, including reduced emissions of sulphur dioxide, particles and nitrogen oxides into the air in western Sweden. The Gothenburg Port Authority is now set to extend the discount period and is already outlining a renewed environmental discount.

 

As part of the Gothenburg Port Authority environmental discount scheme, vessels that report good environmental performance receive a 10% discount on the port tariff, assuming they achieve a certain level according to the globally recognised environmental indexes ESI and CSI. Vessels that run on LNG receive an extra discount of 20% each time they call. The LNG discount is subject to a time limit and was due to run to the end of 2018.

The port authority says that use of LNG began to gather momentum at Gothenburg in the second half of 2016. “Prior to that,” it says, “shipping companies were sceptical about investing as there was no means of bunkering LNG at the port. At the same time, the bunkering companies were unwilling to supply LNG without a customer base”.

 

Edvard Molitor, Environmental Manager says: “A catalyst was necessary to break the deadlock, and the energy discount has been a strong contributing factor behind many players choosing to follow the LNG route.. It took time before it really took off, but today these players are at the LNG forefront at the Port of Gothenburg. Now that the discount period is drawing to a close, we can see that the upward trend is continuing at the port with a growing number of LNG calls. We aim to maintain our support for this development, and we are therefore planning to extend the four-year discount period by a further two years.”

 

He added: “We will of course continue to support vessels that offer a good environmental profile, but we won’t make any distinction in the discount between vessels that produce the same environmental outcomes. As the environmental effects of LNG operation continue to be good, these will also be incorporated into our future environmental control system.”

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