Liberian Registry offers green retrofit incentive

Scott Bergeron, CEO of the Liberian International Ship & Corporate Registry (LISCR) Scott Bergeron, CEO of the Liberian International Ship & Corporate Registry (LISCR)

JANUARY 30, 2015 — The Liberian Registry has entered into a partnership with U.S.-based consultancy EfficientShip Finance (ESF) to launch an environmental initiative designed to reduce global carbon emissions, enhance fleet efficiency and competitiveness, and promote a greener Liberian fleet.

 "The Liberian Registry is an environmentally aware and responsible maritime administration," says Scott Bergeron, CEO of the Liberian International Ship & Corporate Registry (LISCR), the U.S.-based manager of the registry. "We have launched a new initiative to help shipowners improve their green credentials and meet other corporate social responsibilities. Our aim is to ensure that Liberia remains the greenest fleet afloat." 

ESF's partnership with LISCR offers a complete turnkey energy-saving solution for ships on a global basis with an add-on specifically crafted for Emissions Control Areas (ECAs). The Liberian Registry is offering special tonnage tax discounts for ships participating in the initiative. Each ship in the program will be entitled to a 50 percent annual tonnage tax discount in the first year, and up to a 25 percent discount in both the second and third years.

ESF will provide the financial capital needed for each project, and assume responsibility for technology performance and fuel volatility risk, along with the technical supervision and monitoring to perform retrofits.

Owners and operators remit to ESF a proportion of the amount they save on fuel costs, or that they receive in the form of additional negotiated hire. The retrofit projects require no upfront capital by owners and, since the payments are always a share of the savings, there is an ongoing net benefit to customers.

Christian Mollitor, LISCR vice-president and project manager of the green initiative, says, "This represents a great opportunity for owners with ships delivered prior to the eco-boom to have their ships retrofitted with proven fuel-saving technologies. This is yet another example of Liberia's innovative approach to help its shipowners to keep their lead in an increasingly competitive environment." 

The ES program includes an optimal mix of fuel efficiency retrofit solutions for each target vessel, based on its trading pattern, age, size, speed, and consumption. The technologies used represent the most widely accepted and tested solutions in the market including, among others, wake-improving ducts, rudder bulbs and fins, protracted tip propellers, engine improvements, smooth coatings, and performance and trim optimizing software. 

For ships trading within ECA zones, the program may include the installation of exhaust scrubber systems or the conversion of engines to LNG dual-fuel, to comply with emissions requirements that came into effect on January 1, 2015. 

Christian Mollitor says, "We are delighted to have concluded this agreement with ESF. It should help owners and operators reduce fuel costs while creating the potential to increase hire or charter rates or achieve better pool points, and increase asset values in the secondhand market. 

"It should also produce improved utilization rates and marketability, and reduce port costs, freeing up funds for core business investments, including new ship acquisitions, or just facilitating the preservation of cash reserves to make it through a tough market." 

Oliver Petrakakos, COO of ESF, says "The Liberian Registry is the perfect partner for the implementation of this fuel-saving model, given its continuous emphasis on managing a high-quality fleet. ESF is committed to helping LISCR's fleet continue to be green pioneers, while increasing the market competitiveness and strength of its owners."

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