What we think about...
Background information
Danish ports currently offer shore power that primarily covers the energy needs of smaller ships, but with the ongoing green transition, the need for shore power (and energy supply) in ports will increase, which is why expansion of the current capacity will be necessary.
Today, shore power is tax exempt until June 18, 2021. Similarly, ship fuel is also tax exempt.
In the new Green Deal from the EU, it is planned that ships will be supplied with shore power when docked, which is also part of the climate partnerships.
Therefore, the following position on the role and challenges of ports in this development is proposed.
Financing
- Financing large shore power installations is a major challenge for Danish ports. Large facilities to be used for cruise ships and/or other larger ships require large investments. This can be in terms of infrastructure, new power supply to the port and converters so that the port can receive ships at both 50 and 60 Hz. In addition, cruise ship facilities are only used during the summer months and the number of ships can vary from year to year.
- In order to promote the development of shore power, funding from the EU/state/municipalities is therefore necessary - a development that is also seen in our neighboring countries.
- The area is not economically interesting for private players, and thus not exposed to competition, which is why support can be provided by the EU/state/municipality. A scheme that has been used to promote wind energy, for example.
Legislation
- Danish Ports does not consider that there are any legal obstacles to ports being able to supply electricity to ships in port, make related investments and generate profits from these activities. Neither in relation to the Port Act nor the Port Regulation, which makes it clear that TEN-T ports can offer bunkering (i.e. shore power) to ships.
- Danish Ports supports the introduction of EU rules on mandatory connection to shore power in ports that have invested in shore power and where it is technically/practically possible.
- However, Danish Ports do not want all ports to be required to establish shore power for all ships calling at the port. Shore power can be very expensive to establish - for example for small ports with few ship calls. Similarly, in ports that receive many cruise ships, it can also be almost impossible to provide enough power for them in all cases. Therefore, any EU requirement for shore power should be combined with a zero-emission requirement for ships in port, so that an alternative to shore power could be that the ship runs on its own batteries while in port.
- Danish Ports would also like to support an energy tax restructuring that entails equal conditions for different types of fuels and thus modes of transport, with the exception that there should be the possibility of tax reductions (exemptions) for new sustainable forms of energy to support the development and implementation of these fuels.
Special about electricity tax
- This is a special scheme approved by the European Commission and is currently only valid until June 18, 2021.
- Danish Ports finds it crucial that this special scheme is extended beyond June 2021 (preferably made permanent). A non-extension will destroy the business case for many shore power plants, as it will be cheaper for ships to produce their own power rather than connect to shore power.
We embarked on the current stage of the revision of the Ports Act when the expert committee presented its first proposal for the future Ports Act in May 2018, and since then there have been political negotiations and a few postponements. There will be no clarification in the coming year, as the Ports Act is not on the government's legislative program for the current session.
However, Port Denmark's position on the Port Act is clear:
We believe that the new Ports Act should help to ensure a level playing field - especially in terms of lending opportunities - for ports across the country.
We believe that all ports, regardless of organizational form, should have the same access to state-guaranteed loans, and we are strongly committed to ensuring that Danish ports have framework conditions that allow them to compete with other ports, especially in the EU.
We also want a port law that looks at least ten years ahead to allow for new forms of cooperation between public and private actors, so that each can contribute what they do best.
This is the only way we can succeed in a European context with relatively small ports.
Denmark is the only country in Europe besides Romania that considers pilotage a free market, and experimenting with it in Denmark has not had a positive effect on the ports in particular, to say the least.
Among other things, we have noted that prices in the period from 2014 to 2017 have increased by 18 percent on average and for some ports up to 40 percent in the same period. This means that the ports cannot accept further price increases and that we therefore see an advantage in rolling back the liberalization and reintroducing DanPilot's monopoly, as the market de facto looks today. This is despite the fact that we are generally strong advocates of liberalization for the sake of competition. All we have to say here is that pilotage must be a task for the authorities, and that liberalization has damaged the competitiveness of Danish ports.
Our proposal is therefore that 2020 will be a transition year where we define the future framework and keep prices stable.
Danish ports are central to the green transition in the Blue Denmark and the transport sector as a whole.
Ports are the hub where sea, road and rail meet. We need to use less energy for transportation in general and use new fuels. The sea must therefore replace road transportation when it is most climate-friendly. Ports are hubs for Denmark's wind turbine adventure and suppliers of infrastructure for ships. Ports are also increasingly becoming modern industrial clusters that bring together the business areas in which Denmark is a leader and which are most important in the green transition. Commercial ports therefore also play an important role in the green transition that will be implemented in Denmark towards 2030.
The Danish ports have chosen to be at the forefront and are the first in Europe to commit as an industry to working with the UN Sustainable Development Goals and specific objectives for the green transition in ports.
Action area for an emission-free port:
Danish ports are working towards being emission-free by 2030. Ports must ensure that the port's machinery does not use fossil fuels, that the port's own energy consumption is based on renewable energy and that the port becomes CO2 neutral.
Focus area for the circular economy:
Ports must ensure that the port's own waste is recycled and support the recycling of waste received from ships as much as possible. The aim is that at least 90 percent of all waste produced and received by the port will be recycled by 2030.
Focus area for green behavior among customers:
In dialogue with their customers, the ports will ensure that they can create good framework conditions that support customers' green behavior. Among other things, the ports must establish relevant energy infrastructure on and adjacent to the ports, they must differentiate the charges for ship calls in relation to how green the ships are and provide the opportunity for green connection for the ships received at the jetty.
Read more here.
When we look into the future, we have an interest in moving more transportation from road to water. Danish highways are getting more and more crowded, while there is plenty of space on the blue highways, i.e. the waterways.
Blue highways are more environmentally friendly than asphalt highways, and the more we move from road to sea, the more we ease the pressure on the roads. This is better for both the environment and congestion.
It's important for both growth and the environment that in the future we have the opportunity to attract more freight transport to Danish ports rather than to other European ports, because Denmark is among the best at handling it in an environmentally sound way - and not least because it also creates a lot of jobs.
In short: Blue highways are part of the green future.
Background information
On July 1, 2010, the revised Annex VI of MARPOL came into force, introducing stricter sulphur limits for marine fuels in the North Sea and Baltic Sea, among other places. To comply with the requirements, many ships choose to clean the exhaust gases with open scrubbers that discharge the cleaning water into the sea.
A number of studies do not help to clarify the extent to which wastewater discharged from open scrubbers pollutes ports, but nevertheless, a number of ports in Germany and elsewhere have banned the discharge of wastewater in ports.
The EU has pointed out to the IMO that the current guidelines do not regulate discharges in specific areas, including ecologically sensitive areas such as ports where the water flow is not very high, so it is expected that the IMO rules will be tightened in 2021.
Danske Havnes Position
The studies conducted so far on contamination from open scrubbers cannot definitively refute that microorganisms can be affected by contamination from open scrubbers.
Danish Ports welcomes the investigation of pollution from open scrubbers and the development of common international rules and guidelines.
Until there are definitive studies that refute the possibility of pollution from open scrubbers in ports and until common rules and guidance on the use of open scrubbers in ports are issued internationally, ports should be able to decide to prohibit the use of open scrubbers in port based on the precautionary principle.
Ports are an essential part of Blue Denmark and are growth centers for Danish business.
Denmark is one of the world's largest shipping nations. Blue Denmark is designated as one of 12 Danish so-called positions of strength by the Danish Business Promotion Board. This means increased political focus on the entire maritime industry, and it provides more development opportunitieswhich is completely justified. It is in this context important to remember that ports are an essential part of Blue Denmark..
Ports help create many jobs in Denmark.
Ports employ almost 100,000 people. In 2018, there were i a total of 60,271 people were directly employed in Blue Denmark. If you also include the indirect employees (subcontractors to Blue Denmark) of 35,893 people, this gives a total of 96,164 people employed in Blue Denmark. 1 An investment in the ports is therefore also an investment in Danish jobs.
Ports contribute to economic growth in Denmark.
Production in the Blue Denmark had a total value of just over DKK 350 billion in 2018. This corresponds to 8.9 percent of Denmark's total production. Exports in the Blue Denmark amounted to DKK 258 billion in 2018. This corresponds to 25.7 percent of total Danish exports of goods and services, 2
Ports are indispensable for importing and exporting goods to and from Denmark.
Havens kept Denmark going during Covid-19 crisis and will also help bring Denmark out of the crisis. Sf you look at the share of total imports in Denmark, imports via sea - and thus via the Danish ports - 76.7 percent.
Danish ports are efficient.
Despite the fact that Danish ports are small in a European and international context, they were Danish Ports in both 2018 and 2019 no. 6 on the World Economic Forum's list of the most efficient ports in the world3
Denmark has a unique opportunity for an export adventure in offshore wind.
Between 20 and 30 Danish ports are involved in wind. Danish hports have been responsible for shipping more than 80 percent of Europe's Europe's existing offshore wind capacity. The EU Commission has previously estimated that the capacity of offshore wind at least 20-fold if the goal of a climate-neutral Europe is to be achieved by 2050. Oanish knowledge about offshore wind is already in demand around around the world.
There is great potential for future jobs in offshore wind.
Then Danish wind industry employs i today 33,000 jobs. Cautious fprojections show, that 20,000 new Danish jobs in 2030 will be based on windenergy. Furthermore, the gradual replacement of end-of-life wind turbines creates more activity in Danish ports in the form of sustainable decommissioning tasks.
Investments in infrastructure in and around ports are necessary to be ready for the offshore wind industry of the future.
The giant wind turbines we will see at sea in the coming years will be more than 320 meters tall and transporting them over the road network will create additional congestion. The offshore wind turbines can be produced at the the port and then shipped out and installed in the offshore wind farms - but this requires investment in infrastructure in and around the ports. Investments must be made heavily in Danish ports if we are to keep up with development and jobs are not to be lost abroad. The ports are ready for this - but public investments are also necessary.