Company: ASC
Filing Date: 2025-03-07
Form Type: 20-F
Source: 0001558370-25-002500
Chunk: 61

Company: Ardmore Shipping Corp
Filing Date: 2025-03-07
Form: 20-F
Item: Item 4
Chunk 61
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19.2        4.9            25.6%                     0.9       1.7       1.7  
  Total All Tankers                            7,546      690.2       95.7            13.9%                    20.5      31.8      33.9  

Source: Clarksons Research, Drewry

Impact of Regulations

IMO 2020 Regulation on Low Sulfur Fuel

IMO 2020 regulations on low sulfur fuel came into force on January 1, 2020. For many years, high sulfur fuel oil (“ HSFO”) has been the main fuel of the shipping industry. It is relatively inexpensive and widely available, but has a high sulfur content and is the reason that maritime shipping accounted for 8% of global emissions of sulfur dioxide (“ SO2”) prior to 2020, a significant source for acid rain as well as respiratory diseases. IMO 2020 regulation aimed at lowering the emission of SO2 by either allowing shipping companies to use low-sulfur fuel oil (LSFO) or installing scrubbers and continuing to use HSFO. Many shipowners, particularly with larger vessel sizes such as VLCC, installed scrubbers, while others opted for using LSFO.

IMO GHG Strategy

At the MEPC 80 session in July 2023, the IMO revised its GHG emission reduction targets in line with the Paris Agreement, setting more ambitious targets compared to its 2018 initial GHG strategy. The organization now aims for net-zero emissions from the shipping industry by 2050. IMO has added two indicative checkpoints for GHG reduction - i) To reduce the total annual GHG emissions from international shipping by at least 20%, striving for 30% in 2030, compared to 2008 and ii) To reduce the total annual GHG emissions from international shipping by at least 70%, striving for 80% by 2040, compared to 2008. In addition, targets have been set for 2030: i) Reduction of CO2 emission per transport work, by at least 40% compared to 2008; and an uptake in zero or near-zero GHG emission fuels by at least 5% striving for 10%.

Table of Contents

Achieving these targets will require a combination of setting energy efficiency requirements, energy saving technologies, and encouraging shipowners to use alternative fuels such as biofuels, and electro/synthetic fuels such as hydrogen or