Why Investing in Energy Saving Tech (ESTs) Makes Sense
VTAS’s Business Development Manager Charles Yates has developed a number of innovative energy efficiency projects which are both commercial and cut emissions. Here he sets out the financial and strategic benefits of investing in energy saving tech… Investing in ESTs such as hull coatings - which reduce fouling and hence friction - makes sense for many ship owners because there is an attractive financial return coupled with additional benefits which may be harder to qualify. However, to make the right investment decision you need to consider all of the benefits and costs. The financial benefits from investing in an EST typically consist of:
- Fuel cost savings as a result of a more efficient ship which uses less fuel, providing a ROI on installation costs.
- Reduced engine lubrication and maintenance costs as a result of using the engine less intensively (as the EST provides propulsive force, increases the efficiency of the propulsion system or makes the ship slide through the water more easily)
- Higher charter rates and/or increased length of charter as a result of being a fuel efficient cargo vessel
- Higher vessel re-sale values and ability to sell as fuel efficient vessels with lower operating costs will be more attractive to future owners
- Reduced CO2 emissions which - when properly measured and verified - can be sold into the voluntary carbon reduction market and generate additional income
- An enhanced green credibility in the eyes of shareholders so that, for example, a green, fuel efficient cruise liner or ferry will increasingly be more attractive to passengers and hence capable of charging passengers more and/or enjoy higher occupancy
- Enhanced green credentials of supply chain customers, other stakeholders with their own green objectives and the wider public
- A pre-emptive strategy for meeting IMO carbon emission targets
- Reduced exposure to future fuel cost increases.