# Exhaust Gas Cleaning Systems

Selection Guide

Prepared for

Ship Operations Cooperative Program (SOCP)

Ellicott City, MD

File No. 10047.01

22 February 2011

Rev. A

# 1201 Western Avenue, Suite 200, Seattle, Washington 98101-2921 **TEL** 206.624.7850 **FAX** 206.682.9117 **www.** glosten.com 

# Consulting Engineers Serving the Marine Community 

# Prepared for

Ship Operations Cooperative Program (SOCP)

Ellicott City, MD

File No. 10047.01

22 February 2011

Rev. A

BY: ________________________________

_ ___ _ 

# Kevin J. Reynolds, PE

Project Marine Engineer _ _________ _

CHECKED:

_ _____________________________ _ 

# Sean A. Caughlan, PE

Senior Marine Engineer _ _________ _

APPROVED:

_ ____________________________ _ 

# Richard S. Strong

Principal-in-Charge _ _________ _ 

# Exhaust Gas Cleaning Systems

Selection Guide

SIGNED COPY ON

FILE AT GLOSTEN

# Exhaust Gas Cleaning Systems i The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# Contents

Executive Summary ............................................................................................................. .............. iii

Section 1 Introduction .................................................................................................................. . 1



# 1.1 Sulfur Limit Requirements ..................................................................................................... .. 1

1.2 Sulfur Limit Approaches ....................................................................................................... ... 1

1.3 Issues Addressed by This Guide ............................................................................................... 2

Section 2 Sulfur and Other Emissions Requ irements and Gu idelines ..................................... 3



# 2.1 Applicability ................................................................................................................. ............ 3

2.1.1 International ................................................................................................................. ... 3

2.1.2 Emissions Control Areas (ECA s) .................................................................................... 4

2.1.3 Federal – United States.................................................................................................... 4

2.1.4 Regional ...................................................................................................................... .... 5

2.2 NOx Focused Tier Requirements ............................................................................................. 5

2.2.1 IMO Annex VI NOx Details ........................................................................................... 7

2.2.2 EPA Category 1 and 2 Tier Details ................................................................................. 8

2.3 Sulfur Requirements ........................................................................................................... ...... 8

2.3.1 MARPOL Annex VI, 2008 ............................................................................................. 8

2.3.2 EU Ports (Directive 2005/33/EC of the European Parliament and of the Council) ........ 9

2.3.3 California Coastal (Californi a Air Resources Board) ..................................................... 9

2.3.4 US – EPA Category 1 and 2 Engine Vessels .................................................................. 9

2.4 Exhaust Gas Cleaning System Use ........................................................................................... 9

2.5 Uncertainty with EGCS Use ................................................................................................... 1 0

2.5.1 Nitrogen Oxide (NOx) Requirements ........................................................................... 10

2.5.2 Particulate Matter Requirements ................................................................................... 10

2.5.3 Wash Water ................................................................................................................... 10

Section 3 Life Cycle Cost Analysis ............................................................................................ 12



# 3.1 Baseline ...................................................................................................................... ............ 12

3.1.1 Analysis Results ............................................................................................................ 1 3

3.1.2 Vessel/Route Combinations .......................................................................................... 14

3.1.3 Acquisition Costs .......................................................................................................... 14

3.1.4 Expenses ...................................................................................................................... .. 15

3.1.5 Fuel Futures and Inflation ............................................................................................. 16

3.2 Technology Comparisons ....................................................................................................... 17

3.3 Sensitivity Analyses .......................................................................................................... ..... 18

Section 4 Scrubbing Technology Options ................................................................................. 20



# 4.1 Wet Systems ................................................................................................................... ........ 20

4.1.1 Open Loop System ........................................................................................................ 20

4.1.2 Closed Loop System ...................................................................................................... 21

4.1.3 Hybrid System ............................................................................................................... 2 3

4.1.4 Wet Systems Claiming NOx and CO2 Reductions ....................................................... 24

4.2 Dry Systems ................................................................................................................... ........ 25

4.3 Fuel Switching ................................................................................................................ ........ 26

Section 5 Integration, Operations, and Maintenance Pr acticality ........................................... 28



# 5.1 Physical Integration Challenges – All Systems ...................................................................... 28

5.2 Open Loop Seawater System .................................................................................................. 29

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# 5.3 Closed Loop Freshwater System ............................................................................................ 30

5.4 Hybrid System ................................................................................................................. ....... 30

5.5 Dry System .................................................................................................................... ......... 31

5.6 Summary ....................................................................................................................... ......... 32

Section 6 Discussion ................................................................................................................... 35



# 6.1 Cost Advantage ................................................................................................................ ...... 35

6.2 Ship Impacts .................................................................................................................. ......... 35

6.3 Applicability to non-O cean Going Vessels ............................................................................ 36

6.4 Environmental Regulations .................................................................................................... 36

6.5 Experience Matters ............................................................................................................ ..... 37

Section 7 References ................................................................................................................... 38

Appendix A Exhaust Scrubber Technology Survey

Appendix B Life Cycle Costs Tables



# Acknowledgements

The development of this Guide was made possi ble through the financia l support of the U.S.

Maritime Administration (MARAD) and the Ship Operations Cooperative Program (SOCP).

SOCP is a Government Industry Organizati on whose purpose is to address and promote

commercial operations through the identification, development, and application of new methods,

procedures, and technologies. SOCP’s overall ob jective is to improve the competitiveness,

productivity, efficiency, safet y, and environmental responsiven ess of U.S. vessel operations.

The guidance of SOCP member Susan Hayman of Foss Maritime was invaluable. Johnny

Eliasson of ABS performed a technical review of the Guide. Paul Smith, Richard Strong, Darren

Monzingo, and Sean Caughlan of The Glosten Associates provided input and performed

technical review.

It is the intent of SO CP to update this Guide annually. Corrections, suggestions for additional

content, and installation e xperiences provided by web at www.socp.us or by email to

programadmin@socp.us will be considered for these updates.



# Revision History

Section Rev Description Date Approved



# All

― Initial release. 12 January 2011 KJR

Cover A Added DOT, MARAD, SOCP Logos. 22 February 2011 KJR

2.5.3 A Reworded “local regulatory issue” to

“potential area of concern.” 22 February 2011 KJR

6 A Added Non OGV Discussion 22 February 2011 KJR

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# Executive Summary

As of 2015, ship operators that trade in emissions control areas (ECAs) will be required to burn

fuel with less than 0.1% sulfur content. A sh ip operator may meet this requirement by burning

high-sulfur fuel at sea, and then “switching” to low-sulfur fuel within the ECA. Other ship

operators may choose to reduce operational effort s by “converting” such that they always burn

low-sulfur diesel fuel oil, or utilize natu ral gas that has almost no sulfur content.

Alternatively, international convent ion allows a ship operator to bur n high-sulfur diesel fuel if

using an exhaust gas cleaning system (EGCS) th at can reach an equivalent level of emission

reductions. These systems “scrub” most of the sulf ur, and some amount of particulate, out of the

exhaust gas after the high-sulfur fuel is burned.

This Guide has been developed to assist member s of the Ship Operations Cooperative Program

(SOCP) in determining their emissions requireme nts, calculating potenti al cost savings, and

understanding the integration and operational challenges of various EGCS technologies. Each

ship operator will need to consider the discussi ons for and against each EGCS presented herein.

With the coming deadline of 2015, ship operators considering this op tion should conduct an

individual analysis, and c onsider a prototype installa tion in the near future.

Figure 1. Sulfur Emissions Control Strategies

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# Discussion for EGCS

The cost of 0.1% distillate fuel oil has historically been 50% higher than higher sulfur marine

grade residual fuel oils. An anal ysis of three ship types, each of which operated at least partially

within an ECA, predicts net present values be tween $5M and $20M, and inte rnal rates of return

between 20% and 53%. This assumes operatio ns from 2015 through 2025, and an 8% fuel

escalation rate. If fuel prices were to escalate at a rate of 11% annually, the net present value

would increase by almost 50%. These cost saving s are so significant that some ship operators

may find installing an EGCS a competitive necessity.

Discussion against EGCS

Most systems are still in their prototype deve lopment phase, and therefore carry with them

technical risks. Even assuming early technical issues are overcome, the ongoing impact of these

large and complex devices may include: heavy fuel oil heating, purifying, and waste stream

management; treatment and waste chemical hand ling and storage; approximate doubling of the

engine stack size to accommodate scrubber units; weight and stability issues; and additional

engineering staff to run the machinery and monitori ng equipment. Also, it is not yet clear if wet

scrubbers can remove fine particulates to an equivalent level of re duction as is achieved by

switching to low sulfur fuel oil. While there is no current requirement for particulate removal,

the United States Environmental Protection Ag ency (EPA) published discussions have opened

this possibility.

EGCS Ship Candidates

In general the ship candidates for engaging in this dialogue will meet the following criteria:

 New and existing ships built before International Maritime Organization (IMO) Tier III

NOx requirements (Pre-2016 for USCG Category 3 Ships), and

 The ship burns at least 4,000 me tric tons of fuel oil annually within an ECA, for a period

of at least six years starting in 2015, and

 The ship passes a technical survey ensuring th at an EGCS can be integrated with ship

arrangements, stability, and operations. Fo r closed loop and dry chemical systems,

chemical supply chains are confirmed.

Ships that must comply with the IMO Tier III NOx requirements may not be able to install “wet”

scrubber style EGCS. These ships will require ad vanced systems that process NOx and sulfur

emissions, and possibly fine particulates.

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# Section 1 Introduction

1.1 Sulfur Limit Requirements

In certain geographic areas, environmental regul ations require that sh ip operators burn lowsulfur fuel to directly limit sulfur-oxi de emissions. A s econdary, but important

consideration, is that these measures are expe cted to indirectly re duce particulate matter

emissions. As an alternative to utilizing low-sulfur fuel, MARPOL Annex VI recognizes

exhaust gas cleaning systems (E GCS) provided they provide re ductions in sulfur emissions

at least as effective as that obtained by using low-sulfur fuel.

The geographic scope of these requirements is a patch-work that includes International

Maritime Organization (IMO) designated emissi ons control areas (ECAs), European Union

(EU) designated port areas, and a California State designated coastal zone. Each of these

programs has its own phased implementation sche dule, but all reach a fuel quality limit of

0.1% sulfur on or before 1 January 2015.

ECAs currently in force include the Black S ea and Baltic Sea, and will expand to add the

North American zone, extending approximately 200 nautical miles offshore, in 2012. Zones

for Puerto Rico and U.S. Virgin Islands have been accepted, and submittals are being

prepared for Korea, Japan, and Singapore. Eventually, the ECA scope may include all

coastal areas of the world. The area outside of ECAs is subject to world-wide limits set by

IMO. The current world-wide sulfur limit of 4.5% is more generous than typical fuel quality

which averages 2.7% sulfur by weight. This li mit changes, in principal, to a 3.5% sulfur

limit in 2012. This limit changes, in practice, to a world-wide su lfur limit of 0.5% in either

2020 or 2025 depending on a fuel availability review to be conducted in the interim.



# 1.2 Sulfur Limit Approaches

Ship operators have several options for comply ing with the low-sulfur fuel requirements:

 Fuel Conversion. Convert all fuel st orage tanks, fuel piping systems, and

combustion equipment for compatibility with low-sulfur fuel. The ship will then

only burn low-sulfur fuel. This might be dist illate diesel fuel oil, or natural gas.

 Fuel Switching. Install a secondary low-su lfur fuel storage and piping system.

Convert combustion equipment for compatibility for dual (low- and high-sulfur) fuel.

The ship will then burn low-sulfur fuel when operating inside an ECA, and high

sulfur fuel when outside ECAs.

 Exhaust Gas Cleaning System (EGCS). Insta ll an EGCS to scrub sulfur oxides that

result from burning high-sulfur fuel when operating inside an ECA.

The term “distillate” is used in this report to re fer to light, refined dies el fuel with a sulfur

content of 0.5% or less. Th is fuel is called marine gas oil (MGO) in industry, and ISO

DMA. Marine diesel oil (MDO), ISO DMB, a lthough inclusive of some residual content is

also considered “distillate” provide d sulfur contents are below 0.5%.

The term “residual” is used to refer to the le sser refined heavy fuel o ils, which have current

have sulfur contents on average of 2.7%. Industrial names for th e residual or heavy fuel oil

(HFO) diesel grades are IFO180 and IF O380, correspondingly ISO RME25 and ISO

RMG35.

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# 1.3 Issues Addressed by This Guide

This Guide has been developed to assist members of the Ship Operators Cooperative

Program (SOCP) in determining if an EGCS is a practical, lower-cost solution for their fleet.

Specifically, the Guide addresses key issues as follows:

 Regulatory Requirements. “What am I required to do?” The Guide will provide a

basic overview of the regulatory requirem ents, including phase-in dates and fuel

sulfur requirements. The requirements for an EGCS will be outlined. The impact of

nitrogen oxides (NOx) and particulate matter (PM) requirements on an EGCS will be

discussed.

 Life-Cycle Cost. “How much fuel cost savings ca n be realized from an EGCS?”

The Guide will identify the life-cycle co st of several ECGS technologies for a

Transpacific Containership, Alaska to Puget Sound Contai nership, and a U.S. West

Coast Tankship. These vessel type/route pa irs were selected to demonstrate the

variability in life cycle costs. Additiona lly, the evaluation provides a base-line cost

if these vessels did not us e scrubbers, but rather just switched from residual to

distillate.

 Scrubbing Technology Options. “Which EGCS technology will work for my fleet?”

The Guide will identify the efficiencies a nd challenges of the EG CS technologies in

adequately removing sulfur and particulate from the exhaust stream. The challenges

can significantly limit an operator’s t echnology options. For example, open-loop

systems depends on the alkalinity of am bient seawater, which for low-salinity

locations can increase the demand for wash water volume to the point where a system

may not be practical. Closed loop system s solve the low alkalinity challenge with

the addition of a caustic so lution, but at a significant increase in expense and

logistics. Additionally, scrubbing systems may either hinder or enhance the ship’s

ability to control other emissions, such as NOx.

 Operations and Mainte nance Practicality. “Can an EGCS be practically integrated

with ship operations?” The Guide considers the pract icality of the various scrubber

systems. This practicality covers main tenance requirements, the practicality of

fitting the unit into the machinery space, impact on engine performance, and the

ability to integrate the system in to ship operations and machinery.

 Discussion. Finally a discussi on is provided that pulls toge ther the analysis for the

ship operator.

The Appendix provides a technology supplie r survey summary including: state of

technology development, efficacy results, enviro nmental impact evaluations, physical plant

size, integration efforts, and life-cycle costs. Th e results of this survey can serve as an initial

assessment tool for operators that want to further explore EGCS for their fleet.

The manufacturer’s of these systems have formed the Exhaust Gas Cleaning Systems

Association ( http://www.egcsa.com/ ). The association is a resource for keeping current on

system promotions and industry provided info rmation: “Member companies of the Exhaust

Gas Cleaning Systems Association are involve d in the development, design and final

installed configuration and design approval a nd acceptance of turnkey exhaust gas cleaning

systems to meet the current and future emissi ons regulations of IMO and where applicable

additional regulations introduced by regional and national authorities.”

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# Section 2 Sulfur and Other Emissions

Requirements and Guidelines

“What am I required to do?”

This section guides ship operators in identi fying applicable air emissions requirements,

while focusing on opportunities to utilize e xhaust gas cleaning systems (EGCS) for

compliance with sulfur emissions.

Recent regulatory changes have created conti nuously evolving and increasingly stringent

emission standards. Engine manufacturers are required to significantl y reduce air emissions

for both new and remanufactured engines. Lowe r sulfur fuel and reduced sulfur emissions

regulations are curre ntly in effect and further reductions are planned in the coming years.

In general, any ship operating in an ECA will have to either burn low-sulfur fuel or utilize

an EGCS. The ship operator is also burdened to comply with NOx emissions requirements.

In general, all EGCS reviewed herein are co mpatible with IMO Tier I and Tier II NOx

solutions. Ships built in 2016 or later will n eed to meet IMO Tier III NOx requirements,

which may not be compatible with th e “wet” scrubber so lutions reviewed.



# 2.1 Applicability

Emission regulations are largely dependent on th e vessel registry and op erational area. The

following describes the specific requirement appl icable to vessels base d on their specific

registry and operating area.

2.1.1 International

Ship’s that operate on international voyages ar e generally subject to the agreements of the

IMO, as detailed in Annex VI of the Inte rnational Convention for the Prevention of

Pollution from Ships (MARPOL). These re quirements are comprehensive including

requirements for low sulfur fuel or sulfur sc rubbing, particulate matte r and nitrogen oxide

levels, and hydrocarbon management. In addition, significant recordkeeping and

certifications are required.

Flag State is a general term referring to the ad ministration where a ship is registered. Flag

States that are party to Annex VI are required to enforce the annex within the international

ocean going fleet that they administer. In so me cases, such as the United States, the Flag

State may have additional requirements.

Port State is a general term referring to an ad ministration that controls a port(s) where ships

registered by other administrations may call. Port States that are party to Annex VI have the

right to board commercial ships arriving fr om international v oyages to determine

compliance with the Annex. In general, th e Port State will review documentation in

accordance with the Annex, and perform a visual inspection of any installed equipment.

There are numerous exemptions and exceptions from Annex VI. Ship operators considering

such exemptions and exceptions should perfor m a detailed analysis of the Annex, and gain

acceptance from their Flag State prior to implementing a strategy. In general, exemptions

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# include: vessels under 400 gross tons (inter national), diesel engines less than 130 kW

output, technology research trials, emergency e quipment, emergency situations, military and

government vessels, emissions from sea-bed mineral exploration. There are also time

phased exemptions for older ships, specifically for engines manufact ured prior to 1990.

Additionally, there are exclusions based on geographical consider ations such as transport on

the US/Canada Great Lakes where regional agreements are more appropriate.

This Guide does not address ozone deplet ing substances, volatile organic compounds,

shipboard incineration or various ex emptions and exceptions in depth.

2.1.2 Emissions Control Areas (ECAs)

The International Maritime Organization define s two sets of emissions and fuel quality

requirements within Annex VI. Vessels opera ting within an Emissions Control Areas

(ECAs) are required to meet reduced emissi ons standards and burn lower sulfur fuels.

Vessels operating outside of these ECAs are required to meet a second set of lesser

requirements applicable at all remaining locations.

ECA geographic scope currently in force incl udes the Black Sea and Baltic Sea, and will

expand to add the North American zone, ex tending approximately 200 nautical miles

offshore, in 2012. Zones for Puerto Rico and U.S. Virgin Islands have been accepted, and

submittals are being prepared for Korea, Japan, and Singapore. Eventually, the ECA scope

may include all coastal areas of the world. The area outside of ECA zones is subject to

world-wide limits set by IMO.

2.1.3 Federal – United States

Federal regulation in the United States applies to all vessels flagged or registered in the

United States. In addition, the U.S. has the au thority and has stated that it will enforce IMO

Annex VI on all U.S. and foreign vessels operati ng in U.S. waters, as per the Act to Prevent

Pollution from Ships. U.S. regulation of air em issions is dictated by the U.S. Environmental

Protection Agency. As such, rather than regul ating by the internationa l standard of engine

speed, diesel powered compression engines ar e broken into three ca tegories designated by

the engine cylinder volume.

Category 3 vessels, those with an engine of cylinder displ acements above 30 liters, are

required to meet equivalent standards to MA RPOL Annex VI. In addition, the U.S. is

finalizing standards for Category 3 engine to control hydrocarbons (HC) and carbon

monoxide (CO), as well as monitoring of par ticulate matter (PM) emissions. Control of

Emissions From New Marine Compression-Igni tion Engines at or Above 30 Liters per

Cylinder (40 CFR Parts 80, 85, 86, et al.) took effect in June 2010. This ru le is equivalent to

the IMO Annex VI that governs ocean going ve ssels (OGV). Like Annex VI, it includes

fuel standards targeting sulfur emissions and a phased in schedule for NOx reductions. EPA

has indicated two important clarific ations to the rules governing OGVs:

 Category 1 and 2 engines on Category 3 vesse ls can be certified as meeting Annex

VI instead of gaining EPA certification.

 OGVs that are Category 1 or 2 vessels a nd operate offshore extensively, can comply

with Annex VI as an alternate to m eeting EPA designated tier requirements.

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# Category 1 and 2 vessels, those with cylinder displacements below 30 liters, that are not

OGVs are required to meet the mo re stringent EPA 2008 Final Rule.

2.1.4 Regional

Ships are also subject to regional requiremen ts depending on their ope rating location. Most

regional requirements are driven by demands par ticular to the people li ving in those areas,

and in some cases topography that results in the acute impact of air emissions on local

population health. The Los Angeles basin is a primary example of regional requirements,

where air quality is poor, popul ation density is high, and the public is politically engaged on

environmental issues.

Regional requirements are the most likely to ch ange in a short timeframe. Such changes

provide significant challenges to ship operato rs that are making air emissions abatement

decisions. As such, the ship operator must understand the requireme nts of various port

locations at which they are likely to call. The programs reviewed in this Guide include:

 EU Ports. The European Union port locati ons require either the switching to low

sulfur fuels or the use of sulfur scrubb ers while operating in ports or inland

waterways.

 California Coastal Zone. The State of Calif ornia requires the use of low sulfur fuel

while operating within its 24 nautical m ile coastal zone. California does not

specifically allow scrubbers as an alternative to burning low sulfur fuels. There are a

few options for scrubber use that must be reviewed on a case-by-case basis. Also, it

is the intent of California to sunset th e state program once the North American ECA

comes into effect.

 Port of Long Beach. The Port of Long Beach has a stated goal to provide electrical

infrastructure for shore-side power (cold- ironing) at 100% of c ontainer terminals.



# 2.2 NOx Focused Tier Requirements

The International Maritime Organization and the Environmental Protection Agency have

implemented emissions standards in order to reduce emissions from all engines. A tier

system has been adopted in an effort to phase in lower emission engines as early as possible,

while setting a long term goal to significantly reducing emissions using an after-treatment

technology.

Currently, new engines in vessels subject to Annex VI are requi red to meet Tier I emissions

levels. Tier II engines will be required in 2011 as an interim soluti on to reduce emissions

until after-treatment based Tier III engines are phased-in in 2014.

New engines in U.S. flagged category 1 and 2 vessels are required by EPA to meet Tier 2

emissions levels. Tier 3 engines will be phase d-in in 2012 as an inte rim solution to reduce

emissions until after-treatment based Ti er 4 engines are phased-in in 2014.

The IMO and EPA have different rules regardin g major refits and e ngine remanufacturing.

IMO requires vessels built prior to 2000 to meet Tier I emissions levels. Vessels built in

2000 or later must meet the current standard if possible. The EPA re quires engines over 600

kW to reduce their NO

x 

# by 25%, except for Tier 3 engines. EPA has set limits of 2.0 and 5.0

grams per kilowatt-hour for HC and CO respectively.

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# IMO and EPA define various requirements ba sed on vessel build date, engine model year,

engine power, and displacement. The emission regulations are summari zed below in Tables

4 through 6.

Wet EGCS impede the use of advanced SCR systems by cooling the exhaust stream,

wetting the gas stream, and increasing backpr essure on the engine. As such, the below

tables highlight cases where an SCR may be required to meet NOx requirements.

Table 2. Vessel Emissions Requirements, International & Domestic (EPA Category 3)

Table 3. Vessel Emissions Requirements, Domestic (EPA Category 1 & 2)

Table 4. IMO Major Conversion / Remanufactured Engine Tier Requirements

Registry Operational

Area Gross

Tons LOA

(m) Total

(kW) Power

(kW) Bore

(liters)

All International All Vessels Annex VI Sulfur Limits

All International Jan

‐ 00 to Dec

‐ 10 >400 >130 Annex VI Tier I

All International Built after Dec

‐ 10 >400 >130 Annex VI Tier II

All ECA Built after Dec

‐ 15 >400 >24 >750 >130 Annex VI Tier III

US Domestic All Vessels All >30 Per Annex VI Ship / Engine Particulars

Build Date Requirement



# Registry Operational

Area Power

(kW) Bore (liters)

US Domestic All Vessels EPA Sulfur Limits

US Domestic Jan

‐ 04 + engines >37 >2.5 EPA Tier I = Annex VI Tier I

US Domestic Jan

‐ 04 + engines >37 <2.5 EPA Tier 2

US Domestic Jan

‐ 07 + engines >37 2.5

‐ 30 EPA Tier 2

US Domestic Jan

‐ 12 + engines 75

‐ 3700 <0.9 & 3.5

‐ 7 EPA Tier 3

US Domestic Jan

‐ 13 + engines 75

‐ 3700 0.9

‐ 1.2 & 2.5

‐ 3.5 EPA Tier 3

US Domestic Jan

‐ 14 + engines 75

‐ 3700 1.2

‐ 2.5 EPA Tier 3

US Domestic Jan

‐ 13 + engines >3700 7

‐ 15 EPA Tier 3

US Domestic Jan

‐ 14 + engines >3700 15

‐ 30 EPA Tier 3

US Domestic Jan

‐ 14 + engines >2000 15

‐ 30 EPA Tier 4

US Domestic Jan

‐ 16 + engines 1400

‐ 2000 <30 EPA Tier 4

US Domestic Jan

‐ 17 + engines 600

‐ 1400 <30 EPA Tier 4 Ship / Engine Particulars

Requirement Engine Model

Year



# Registry Operational

Area Gross

Tons Major Conversion /

Remanufacture Date

All International before Jan

‐ 00 >400 Any Annex VI Tier I

All International after Dec

‐ 99 >400 Jan

‐ 00 to Dec

‐ 10 Annex VI Tier I

All International after Dec

‐ 99 >400 after Dec

‐ 10 Annex VI Tier II

All ECA after Dec

‐ 99 >400 after Dec

‐ 15 Annex VI Tier III Requirement Ship / Engine Particulars

Build Date

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# Table 5. EPA Major Conversion / Remanufactured Engine Tier Requirements



# 2.2.1 IMO Annex VI NOx Details

Regulation 13 of IMO Annex VI applies to non- emergency marine diesel engines with an

output of more than 130 kW installed or subs tantially modified on or after 1 January 2000.

NO

x 

# limitations for these engines are tiered as indicated below, where n = rated engine

speed. The Regulation includes numerous except ions, including engines only used in an

emergency and in minerals exploration. Fi gure 2 and Table 6 pres ent the IMO Annex VI

Tier NO

x 

# requirements.

Figure 2. IMO Annex VI Tier NO

x 

# Requirements



# Registry Operational

Area EPA Tier Power

(kW) Remanufacture

Date

US Domestic Tier 0 >600 after Jan

‐ 00 Tier 0+ (25% NO

x 

# Reduction)

US Domestic Tier 1 >600 after Jan

‐ 00 Tier 1+ (25% NO

x 

# Reduction)

US Domestic Tier 2 >600 after Jan

‐ 13 Tier 2+ (25% NO

x 

# Reduction)

US Domestic Tier 3 >600 Any Tier 3 Engine Particulars

Requirement

17 17

13.0

11.3

10.4

9.8 9.8 14.4 14.4

10.5

9.0

8.2

7.7 7.7

3.4 3.4

2.6 2.3 2.1 2 2



# 0 2 4 6 8 10 12 14 16 18

0 500 1000 1500 2000 2500NitrogenOxides(grams/kW‐hr)



# Engine Speed (rotations per minute) 

# Nitrogen Oxide Requirements

‐ IMO Annex VI

Tier I (2000

‐ 2010 Build) Tier II (2011

‐ 2015 Build) Tier III (2016 Onward Build) 130 RPM, Low Speed

2000 RPM, High Speed

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# Table 6. IMO Annex VI Tier NOx Requirements



# 2.2.2 EPA Category 1 and 2 Tier Details

The EPA marine engine emissions are regula ted by a number of different rules, each

contributing to the current four tier rating system. Emission regulations vary by power,

cylinder displacement, and model year.

In general, Tier 1 requirements are similar to the IMO Annex VI Tier I requirements. Tier 2

and Tier 3 regulation incrementally reduce emissi ons with the intent that manufacturers can

meet the requirements through modifications to piston rings, cylinder walls, timing, and fuel

management. This is similar to the intent of IMO Annex VI Tier II requirements.

EPA Tier 4 emissions limits will require engines to use after-treatment devices similar to the

IMO Annex VI Tier III requirements. The EPA Tier 4 standard is very similar to the IMO

Annex VI Tier III.

Specific EPA emission requirements including NOx, HC, and PM limits can be found in 40

CFR Parts 9 and 85.



# 2.3 Sulfur Requirements

The EGCS market is being driven by regulat ory requirements to reduce ship emissions of

sulfur oxides. Ships have the option of either using a low sulfur fuel oil or scrubbing their

exhaust gas to an equivalent sulfur level. The following table summarizes the low sulfur

phase-in dates specified in each of the presented regulations.

Table 7. Low Sulfur Phase-In Dates



# 2.3.1 MARPOL Annex VI, 2008

Oceans : The current marine bunker fu el sulfur limit of 4.5% is reduced to 3.5% in 2012. A

further reduction to 0.5% will be reviewed in 2018, with implementation options of 2020 or Rated Speed

Less than 130

RPM 131 Through

2,000 RPM Greater than

2,000 RPM

Construction Date (g/kW

‐ hr) (g/kW

‐ hr) (g/kW

‐ hr)

Tier I. 2000

‐ 2010 17 45 * n^

‐ 0.2 9.8

Tier II. 2011

‐ 2015 14.4 44 * n^

‐ 0.23 7.7

Tier III. 2016 Onward 3.4 9 * n^

‐ 0.2 2

Category 3 Ships

Starting Year

(Jan 1st) Oceans Emission

Control

Areas EU Ports California

Coastal Cat. 1 & 2

Ships

2010 4.5% 1.0% 0.1% 0.5% * 0.0500%

2012 3.5% 1.0% 0.1% 0.1% 0.0015%

2015 3.5% 0.1% 0.1% 0.1% 0.0015%

2020 (2025) ** 0.5% 0.1% 0.1% 0.1% 0.0015%

*0.5% Marine Gas Oil, or 0.1% Marine Diesel Oil

**Implementation of Oceans limit at 0.5% Sulfur subject to review in 2018

# Exhaust Gas Cleaning Systems 9 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# 2025. There is considerable debate as to whether the 0.5% requirement will be met with

distillate or residual fuel. This report assumes that desulfuriza tion of residual fuel will be

the more common approach.

Emissions Control Areas: The current marine bunker fuel sulfur limit of 1.0% is further

reduced to 0.1% in 2015. To pr actically achieve 0.1% sulfur, use of distillate is required.

2.3.2 EU Ports (Directi ve 2005/33/EC of the European Parliament and of

the Council)

Marine bunker fuel sulfur limits apply to inla nd waterway vessels and ships at berth. “At

berth” effectively limits the requirement to auxi liary loads while dockside or at anchor. The

current 1.5% limit applies to passenger vessels, and vessels operating in the Baltic and North

Seas. January 2010 limits all vessels to 0.1%, effectively requiring a distillate fuel.

2.3.3 California Coastal (Ca lifornia Air Resources Board)

Current marine bunker fuel options for ocean go ing vessels (OGVs) are either marine gas oil

(DMA) limited to 1.5% sulfur, or marine dies el oil (DMB) limited to 0.5% sulfur (see

asterisk in above table). These grades of dis tillate fuels are expected to reduce particulate

matter significantly in exhaust emissions. Ja nuary 2012 allows use of either of these

distillate fuels, but with a limit of 0.1% sulf ur. Category 1 and 2 ve ssels are limited to 15

ppm sulfur fuel (0.0015%).

2.3.4 US – EPA Category 1 and 2 Engine Vessels

With the implementation of higher Tiers (3 and 4) of regulation for Category 1 and 2

engines, the EPA has mandated th e supply chain to distribute lo wer sulfur content in fuel.

As of 2010, all marine fuel is required to contain 1,000 ppm (0.1000%) of sulfur or less.

Then in 2012, locomotive and marine fuel is required to be ULSD , or less than 15 ppm

(0.0015%) of sulfur. EPA has indicated two impor tant clarifications to the rules governing

U.S. Flagged ocean going vessels (OGVs):

 Category 1 and 2 engines on Category 3 vesse ls can be certified as meeting Annex

VI instead of gaining EPA certification.

 OGVs that are Category 1 or 2 vessels a nd operate offshore extensively, can comply

with Annex VI as an alternate to m eeting EPA designated tier requirements.



# 2.4 Exhaust Gas Cleaning System Use

The IMO and EPA both recognize Exhaust Gas Cleaning Systems (EGCS) as acceptable

alternatives to low sulfur fuels.

The IMO 2008 Guidelines for Exhaust Gas Cleaning Systems (Guidelines) specifies the

process for testing, certification, and verification for the use of exhaust gas cleaning systems

(ECGS). The Guidelines provide specific requ irements for measuring of the sulfur content

in the exhaust gas and monitoring wash water discharge quality, including pH changes and

contaminant levels. This regulation is contin uing to evolve as t echnology providers gain

application experience.

Compliance with IMO sulfur re duction requirements options are detailed in the Guidelines

and termed Scheme A – Type Approval, and Scheme B – Continuous Emissions Monitoring

(CEM). The Scheme A approach demands a significant testing and approval process

# Exhaust Gas Cleaning Systems 10 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# resulting in a Type Approval. The Scheme B approach requires the use of sophisticated

emissions monitoring equipment. Such a m onitoring system however, although to perhaps a

somewhat lower standard, will still be required for Scheme A systems.

EPA provides guidance in its Vessel Gene ral Permit program regarding wash water

requirements, and follows the IMO Guidelines. However, the EPA has instituted a

particulate matter testing program for Category 3 engines, and may in the future define PM

requirements related to the use of EGCS.



# 2.5 Uncertainty with EGCS Use

There are a number of sources for uncertainty that must be understood before selecting an

EGCS. These include technology compatibil ity among both current and future required

equipment technology. Additionally, future regulatory changes both on sulfur, NO

x 

# and PM

will affect the practicality of implementing an EGCS.

Scrubber suppliers use different designs, and ha ve different water and power requirements.

As such, the ship operator should study the engi neering details of several providers before

making a selection decision.

2.5.1 Nitrogen Oxide (NOx) Requirements

Ship operators must consider requirements for the abatement of NOx when selecting a

suitable sulfur abatement strate gy. In general, sulfur scrubbe rs are compatible with NOx

abatement strategies, such as engine tuning, that target currently enforced IMO Tier I/II and

EPA Tier 1/2/3 emission limit. This strate gy is compatible as it does not significantly

impact engine backpressure that is important to EGCS.

However, some sulfur scrubbers are not compa tible with NOx abatement strategies, such as

selective catalytic reduction (SCR), that ta rget the IMO Tier III and EPA Tier 4 NOx

requirements that phase-in starting in 2016. SCRs work best with hot, dry, low sulfur

exhaust streams. Also, the combined EGCS and SCR use will require fan use to avoid

excessive backpressure on the engines. As such, NOx requirements will not significantly

affect the adoption of sulfur scrubbers until 2016, when more advanced NOx abatement

technologies will be required.

2.5.2 Particulate Matter Requirements

EPA is currently in a program that is evaluating the efficiency of PM10 and PM2.5

reduction resulting from diesel combustion of low su lfur fuels. It is possible that a PM limit

will be added to EGCS requirements. There is un certainty as to the efficacy of EGCS in the

removal of particulate matte r, in particular PM2.5.

2.5.3 Wash Water

Wash water discharge impacts local water quality, and as such will remain a potential area

of concern. It is possible th at local regulations will devel op, or that local environmental

concerns will be voiced over wash water di scharges in certain areas. This creates

uncertainty for the use of open loop scrubbers in certain environmentally sensitive areas.

The monitoring of wash water, as per IM O guidance, includes polycyclic aromatic

hydrocarbons (PAH) and turbidity. These instrume nts require significant effort to maintain

and keep in calibration.

# Exhaust Gas Cleaning Systems 11 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# Table 8. Regulatory Compliance Overview



# Nitrogen oxide Tiers I, II, and III are IMO standa rds. Tiers 1, 2, 3, and 4 are EPA standards. Compliance Options

Low Sulfur

Fuels Engine

Modifications Sulfur

Scrubbers Advanced

Technologies

Sulfur Regulations

1.5% S ACAB

0.5% S ACAB

0.1% S ACAB

Particulate Matter

PM 2.5 B C C B

PM 10 B B B B

Nitrogen Oxides

Tier I / Tier 1 CBCB

Tier II / Tier 2 & 3C B C B

Tier III/ Tier 4 CCDB

Key: A

‐ Full Solution, B

‐ Varies by Technology, Possible Full Solution

C

‐ Typically Not a Solution but Likely Compatible with Other Solutions

D

‐ Typically Not a Solution and Likely Not Compatible with Other Solutions

# Exhaust Gas Cleaning Systems 12 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# Section 3 Life Cycle Cost Analysis

“How much fuel cost savings ca n be realized from an EGCS?”

Exhaust gas cleaning systems (EGCSs) offer pot ential fuel cost savings for ships that

operate in emissions control areas (ECAs). Although California and EU Ports currently

require significantly low sulfur levels in mari ne fuel, widespread implementation takes place

in 2015 when 0.1% sulfur “distillate” fuel, or an EGCS, becomes mandatory. Potential cost

saving is the product of fuel consumed in an ECA and the cost differe ntial between distillate

and residual fuel. This savi ngs is then reduced by EGCS capital and operating expenses,

including crew, maintenance and repair, consumed chemicals, and machinery loads.

ݏ݅݊݃ݒܵܽ ݐݏ݋ܥ ݈݁ݑܨ

ൌ ሺ ݈݅ܽݐ݁݊ݎ݂݂݅݁ܦ ݐݏ݋ܥ ݁ݐ݈݈݅ܽݐݏ݅ܦ כ ݊݋݅ݐ݌݉ݑݏ݊݋ܥ ݈݁ݑܨ ܣܥܧ ሻ

ሻݏ݁ݏ݁݊݌ݔܧ ݅݊݃ݐܽݎ݁݌ܱ ܽ݊݀ ݈ܽݐ݅݌ܽܥ ܵܥܩܧሺ െ

This section provides life cycle cost analysis (LCCA) examples designed to inform the ship

operator of the key variables that impact life cycle cost, and key uncertainties that will have

a substantial impact on potential projects budget. It is envisioned that the ship operator will

set-up a customized LCCA for their own ship or fleet. This analysis is broken into the

following parts:

 Baseline. Three ship/route combinations are analyzed to highlight the impacts of

quantity of fuel consumed in an ECA. One baseline ship is used for the remaining

analysis.

 Technology cost differences. Four scrubber t echnologies are analyzed to review the

impact of capital and operat ing expenses on life cycle.

 Uncertainty and Sensitivity. Factors that a ship operator can neither predict nor

reliably control are reviewed. The baseline ship is then used to demonstrate analysis

sensitivity to both uncertain factors, a nd those the ship operator can control.



# 3.1 Baseline

A baseline life cycle cost analysis is provided in Table 9 for three ship/route pairs. This

side-by-side analysis estimates different cap ital expenses for instal ling a similar EGCS on

each ship due to differences in propulsion plant sizes. The annual fuel consumption within

an ECA for each ship is a function of ship pr opulsion, ship service, and cargo loads, as well

as the ship’s route and ports of call.

The remainder of the key variables are consiste nt for each ship/route pair. This includes

predicted fuel cost differentials for distillate , inflation and labor rates, and EGCS operating

expenses.

# Exhaust Gas Cleaning Systems 13 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# Table 9. Life Cycle Cost Analys is, Baseline for Three Ship/Route Pairs



# 3.1.1 Analysis Results

The analysis demonstrates that the quantity of fuel consumed within an ECA is the key

driver of the potential savings through the project life cycle. Capital e quipment cost is also

important as a one-time e xpense that extends the investment payback period.

The net present value for all three pairs is positive, ranging from approximately five to

twenty million in U.S. dollars, with the hi gher value corresponding to the higher in ECA

fuel consumption. Ship/Route Pair Containership

Transpacific Containership

Alaska to

Puget Sound Tankship US

West Coast

Scrubber Type Open Loop Open Loop Open Loop

VARIABLES

‐ CONTROLLED

Investment Terms

Life Cycle (# of Years) 

# 10 10 10

Analysis Date (Today) (Year) 

# 2011 2011 2011

Scrubber Installation Date (Year) 

# 2014 2014 2014

Discount Rate (%) 

# 10.0% 10.0% 10.0%

Capital Expense for Scrubber

Equipment (Today) (USD/One Time) 

# $5,260,000 $5,060,000 $3,960,000

Engineering/Design (% Equip Cost) 

# 7.0% 7.0% 7.0%

Training/Documents (% Equip Cost) 

# 2.0% 2.0% 2.0%

Install/Commission (% Equip Cost) 

# 50.0% 50.0% 50.0%

Operating Expense

‐ Annual

ECA Fuel Consumption (MT/Annual) 

# 6,212 9,636 10,840

Chemical Consumption (% of Fuel Cost) 

# 0.0% 0.0% 0.0%

Scrubber Parasitic Loads (% of Fuel Cost) 

# 2.0% 2.0% 2.0%

Distillate Calorie Correction (% of Fuel Cost) 

# 4.0% 4.0% 4.0%

HFO Process and Heating (% of Fuel Cost) 

# 0.8% 0.8% 0.8%

Operating Engineer (Today) (USD/Annual) 

# $292,000 $292,000 $292,000

Operating Engineer (% of Position) 

# 50.0% 50.0% 50.0%

M&R Equipment (% Equip Cost/Annual) 

# 4.0% 4.0% 4.0%

Variables

‐ Uncertain

Fuel Differential (Today) (USD/MT) 

# $255.50 $255.50 $255.50

Fuel/Chemical Escalation Rate (%

‐ Annual for Op Period) 

# 8.0% 8.0% 8.0%

Personnel Inflation Rate (%

‐ Annual for Op Period) 

# 3.0% 3.0% 3.0%

Equipment Inflation Rate (%

‐ Annual for Op Period) 

# 3.3% 3.3% 3.3%

Analysis Results

‐ Overview (Nearest $1,000)

Capital Cost (USD

‐ Year Zero Dollars) 

# (9,219,000) (8,868,000) (6,941,000)

Expenses

‐ Year One (USD

‐ Year One Dollars) 

# (551,000) (623,000) (601,000)

Fuel Savings

‐ Year One (USD

‐ Year One Dollars) 

# 2,159,000 3,350,000 3,768,000

Net Present Value (USD

‐ 2011 Dollars) 

# 4,851,000 14,562,000 20,110,000

Internal Rate of Return (%) 

# 20% 36% 53%

# Exhaust Gas Cleaning Systems 14 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# The internal rate of return (IRR) ranges from 20% to 53%, with the highest return

corresponding to the highest ECA fuel consumpti on. Each ship operator will need to set the

minimum rate of return for themselves.

Assumptions and annual calculations to support th e tables in this section may be found in

the Appendix.

3.1.2 Vessel/Route Combinations

Three vessel/route combinations were select ed to demonstrate the impact of fuel

consumption within an ECA on life cycle cost.

Transpacific containership. This 4,000 TEU ship transits between Shanghai, Los Angeles,

and Oakland in a round trip of 25 days at 23 knots. It operates a 36 megawatt propulsion

plant at 30.2 megawatts to maintain speed. A combined 3,000 kilowatt ship’s service plant

typically runs at 1,200 kilowatts, increasing to 2,000 kilowatts while in port. Annual fuel

consumption estimated at 35,000 metric tons, w ith 6,200 in an ECA. This assumes that

Shanghai will be an ECA by 2015.

Containership Puget Sound to Alaska. This 2,000 TEU ship transits between Tacoma and

Anchorage in a round trip of 7 days at 20 knot s. It operates a 16 megawatt propulsion plant

at 14.7 megawatts to maintain speed. A co mbined 3,000 kilowatt sh ip’s service plant

typically runs at 800 kilowatts , increasing to 1,600 kilowatts while in port. Annual fuel

consumption estimated at 19,000 metric tons, with 9,600 in an ECA. This assumes that the

ship would divert course to outside of the ECA for 50% of its voyage starting in 2015 once

distillate fuel consumption is required.

Tankship US West Coast. This 60,000 DWT product carrier transits between Anacortes and

Long Beach in a round trip of 8 days at 14.5 knots. It operates a 10 megawatt propulsion

plant at 9 megawatts to maintain speed. A combined 3,000 kilowatt ship’s service plant

typically runs at 350 kilowatts , increasing to 2,350 kilowatts while in port. Annual fuel

consumption estimated at 11,000 metric tons, al l of which will be within an ECA beginning

is 2015.

3.1.3 Acquisition Costs

For each of the subject ships, acquisition cost s of scrubbing technologies have been broken

down into equipment, engineering/design, installation/commissioning, and training/

documentation costs.

Equipment costs shown in Table 10 are based on budget estimates provided by the

equipment suppliers for this analysis. These budge ts were normalized such that each covers

roughly the same scope of supply, such as equipment engineering, equipment supply, and

installation oversight. In each case, each propuls ion engine is paired with a single scrubber

unit, and multiple electric generating units are served by a single scrubber unit. Where

multiple suppliers provided budgets for the same technology, they were generally averaged.

Actual prices for ship-specific scrubber sy stems must be obtained directly from the

suppliers, in order to account for arrangements and other specifics.

# Exhaust Gas Cleaning Systems 15 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# Table 10. Estimated Scrubber Equipment Only Costs for Subject Ships



# Installation and commissioning is assumed to be 50% of the equipment cost for all

technologies. Other costs are also based on percentages of equipment cost: 7% for

engineering/design, and 2% fo r training and documentation.

Given that very few scrubbers have been in stalled, there is uncertainty with both the

equipment costs and the support costs. Also, eac h ship is unique and will require a custom

cost estimate. As such, these budgets are rough order of magnitude.

3.1.4 Expenses

Maintenance and repair expenses are assumed to be 4% annually of the equipment costs.

For operations, it is assumed that an additiona l engineer will be required spending at least

half time on scrubber operations. The cost of the engineer wi ll vary significantly based on

the flag of the ship.

Consumables and parasitic loads have been conv erted to a percentage of fuel consumption.

For closed loop and dry scrubbers, chemical s upply lines and costs are significant. Caustic

soda prices are highly volatile , with the “free on board” cost per metric ton escalating from

$270 in August to $340 in October of 2010. Alt hough these fluctuations do not necessarily

follow fuel prices, this analysis links the two. It is assumed that caustic soda will average

50% the cost of residual fuel o il on a weight basis. The amount of caustic soda consumed, is

based on supplier information assuming 2.7% sulfur fuel.

Burning residual fuel requires significant hea ting, purifying, and waste management efforts

that require energy, maintenance, and opera tional efforts. Typically the tanks and

combustion fuel lines are heated by waste heat generated steam, meaning that energy costs

are relatively low. A small percentage, 0.8% of fuel consumption, is assumed to be

expended managing the residual fuel oil.

A 5% correction factor is applied to account fo r the difference in heati ng value of distillate

on a weight basis, as compared to residual fuel. On the other hand distillate is lighter, and

therefore requires a higher volume for storage, and more importantly for piping work and

mechanical systems. This volume difference re sults in a diesel engine energy loss. The Open Loop Closed Loop Hybrid Dry

Scrubber Ratings

(by Engine Size) (USD) (USD) (USD) (USD)

36MW 3,100,000 3,850,000 3,600,000 6,050,000

16MW 2,900,00 0 3,600,00 0 3,120,00 0 3,200,00 0

12MW 2,000,00 0 2,500,00 0 2,220,00 0 1,900,00 0

10MW 1,800,000 2,150,000 1,920,000 1,600,000

3MW 1,300,00 0 1,850,00 0 1,560,00 0 1,250,00 0

1MW 1,000,000 1,750,000 1,260,000 930,000

Containership

Transpacific 5,260,000 6,430,000 5,904,000 7,970,000

Containership Alaska

to Puget Sound 5,060,000 6,180,000 5,424,000 5,120,000

Tankship US West

Coast 3,960,000 4,730,000 4,224,000 3,520,000

# Exhaust Gas Cleaning Systems 16 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# baseline assumes an aggregate 4% reduction in weight based fuel consumption when

burning distillate.

3.1.5 Fuel Futures and Inflation

There is no consensus on future fuel prices. More importantly to scrubber life cycle costs is

the fuel cost differential between residual fuel and distillate fuel . Bunkerworld.com listed

Los Angeles IFO380 at $540.50, and MGO at $796.00 on 11 January 2011. This differential

is $255.50 per metric ton, or a 47% premium for the low sulfur distillate fuel.

Fuel cost predictions on this differential fall into the following general categories:

 In 2015 distillate will become scarce because of the demand created by ships

attempting to comply with ECA requirement s. The distillate premium will then

escalate very quickly, as refineries are forced to employ energy intensive and

expensive means of refining more distillate.

 There is a fixed amount of energy and effort to refine distillate. Therefore, the

distillate premium over resi dual fuel should remain stea dy, accounting for inflation.

 The premium for low sulfur distillate (mar ine gas oil) has generally been 50% over

residual fuel, and is likely to remain that way.

This analysis assumes that the distillate pr emium will be 50% above the price of residual

fuel. As a baseline, this anal ysis assumes fuel price escalatio n at 8% annually as generally

supportive of a ten-year life cy cle for a system installation.

Currently, inflation as measured by the cons umer and producer price indices is low.

However, this analysis is looking at expenditure s that target ship ope rations over a long term

period from 2015 through 2025. We have elected to use rates of 3.3% for PPI and 3.0% for

CPI are assumed in the baseline.

Ship operators are encouraged to utilize their own predictions for ener gy prices and inflation

in future years.

# Exhaust Gas Cleaning Systems 17 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# 3.2 Technology Comparisons

The vessel/route comparisons demonstrated that fuel consumption volumes within an ECA

are the key factor in predicti ng the economic advantage of a sc rubber. This section focuses

on the Containership Alaska to Puget Sound ship /route pair in order to compare the impact

of various EGCS technol ogies on life cycle cost.

Table 11. EGCS Technology Impact on Life Cycle Cost



# All technologies show positive net present values, and relatively high IRR ranging from

25% for the closed loop scrubbe r, to 36% for the open loop sc rubber. Although there is a

fiscal advantage for the open loop scrubber, net present value shows adequate margin to

allow a ship operator to select the most appropriate technology for their operation. Ship/Route Pair Containership

Alaska to

Puget Sound Containership

Alaska to

Puget Sound Containership

Alaska to

Puget Sound Containership

Alaska to

Puget Sound

Scrubber Type Open Loop Closed Loop Hybrid Dry

Sensitivity Analysis Scrubber Types Open Loop Closed Loop Hybrid Dry

VARIABLES

‐ CONTROLLED

Investment Terms

Life Cycle (# of Years) 

# 10 10 10 10

Analysis Date (Today) (Year) 

# 2011 2011 2011 2011

Scrubber Installation Date (Year) 

# 2014 2014 2014 2014

Discount Rate (%) 

# 10.0% 10.0% 10.0% 10.0%

Capital Expense for Scrubber

Equipment (Today) (USD/One Time) 

# $5,060,000 $6,180,000 $5,424,000 $5,120,000

Engineering/Design (% Equip Cost) 

# 7.0% 9.0% 9.0% 11.0%

Training/Documents (% Equip Cost) 

# 2.0% 2.0% 2.0% 2.0%

Install/Commission (% Equip Cost) 

# 50.0% 65.0% 75.0% 85.0%

Operating Expense

‐ Annual

ECA Fuel Consumption (MT/Annual) 

# 9,636 9,636 9,636 9,636

Chemical Consumption (% of Fuel Cost) 

# 0.0% 3.0% 1.5% 3.0%

Scrubber Parasitic Loads (% of Fuel Cost) 

# 2.0% 1.0% 1.5% 1.0%

Distillate Calorie Correction (% of Fuel Cost) 

# 4.0% 4.0% 4.0% 4.0%

HFO Process and Heating (% of Fuel Cost) 

# 0.8% 0.8% 0.8% 0.8%

Operating Engineer (Today) (USD/Annual) 

# $292,000 $292,000 $292,000 $292,000

Operating Engineer (% of Position) 

# 50.0% 65.0% 65.0% 65.0%

M&R Equipment (% Equip Cost/Annual) 

# 4.0% 4.0% 4.0% 4.0%

Variables

‐ Uncertain

Fuel Differential (Today) (USD/MT) 

# $255.50 $255.50 $255.50 $255.50

Fuel/Chemical Escalation Rate (%

‐ Annual for Op Period) 

# 8.0% 8.0% 8.0% 8.0%

Personnel Inflation Rate (%

‐ Annual for Op Period) 

# 3.0% 3.0% 3.0% 3.0%

Equipment Inflation Rate (%

‐ Annual for Op Period) 

# 3.3% 3.3% 3.3% 3.3%

Analysis Results

‐ Overview (Nearest $1,000)

Capital Cost (USD

‐ Year Zero Dollars) 

# (8,868,000) (11,990,000) (11,121,000) (11,175,000)

Expenses

‐ Year One (USD

‐ Year One Dollars) 

# (623,000) (790,000) (722,000) (742,000)

Fuel Savings

‐ Year One (USD

‐ Year One Dollars) 

# 3,350,000 3,350,000 3,350,000 3,350,000

Net Present Value (USD

‐ Present Dollars) 

# 14,562,000 10,185,000 11,574,000 11,336,000

Internal Rate of Return (%) 

# 36% 25% 28% 27%

# Exhaust Gas Cleaning Systems 18 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# The open loop technology holds a financial a dvantage because both capital and operating

expenses are less. The system has the fewest number of components re sulting in lower cost

for engineering and installation

Higher engineering, installation, and operating e xpenses are assumed for the closed loop and

hybrid systems. This is a function of the ch emical consumable that requires holding tanks,

handling systems, labor to move on board, a nd disposal of the waste product. The dry

system sees an additional installation cost increase due to the la rge dry chemical hopper

tanks and conveyor systems that require in stallation, operations, and maintenance.



# 3.3 Sensitivity Analyses

A ship operator has some control, or ability to predict, the amount of fu el that will be burned

within an ECA, the operating life of the ship/s ystem, and crew baseline salaries. These are

primary factors in determining life cycle cost. However, there are other factors that are

more difficult to predict. This includes fuel escalation and inflation ra tes, as well as some

risk with the installation costs of the project.

This section continues with the Containership Alaska to Puget Sound in order to determine

the sensitivity of the analysis to these variab les. Following these descriptions, a table is

provided that considers several combinations of these sensitive variables in attempt to

bracket fiscal risk of an EGCS project. Table 12 brackets the best case IRR at 62%, and the

worst case IRR as 6% for the baseline ship.

ECA Fuel Consumption Volume – High Sensitivity . The baseline assumed that the ship

burned roughly 50% of its fuel in an ECA for an IRR of 36%. If the ship must stay within

the ECA 75% or 100% of the time, the IRR in creases to 55% and 73% respectively. The

same ship, if it were to only burn 4,000 metric tons (~21% of its annu al consumption) would

have a negative NPV. As such, this is c onsidered a minimum fuel consumption volume for

EGCS consideration for an ocean going ship.

Inflation and Fuel Cost Escal ation – Moderate Sensitivity . Inflation as it impacts equipment

and labor costs has a negative impact on EGCS lif e cycle costs. However, if that inflation

also impacts distillate fuel cost differentials, the net impact is positive. The net result is that

the two forces work to count er-act each other to some extent. The baseline example

assumes 3% CPI, 3.3% PPI, and 8% fuel escalat ion on an annual basis for an IRR of 36%.

A high inflation period of 5% for CPI and PPI, a nd 11% for fuel results in an IRR of 44%.

A low inflation period of 2% CPI and PPI, a nd 5% for fuel results in an IRR of 24%.

Operating life – M oderate Sensitivity . The baseline operating life is ten years, providing a

return of 36%. If the operating life is exte nded to 15 or 20 years, the IRR remains relatively

flat at 39%. However, it should be noted th at the NPV increases from $14.5M to $25.1M to

$34.9M for 10, 15, and 20 years respectively. An operating life of less than four years

yields a negative NPV.

Expenses – Moderate Sensitivity . The sensitivity of expenses was analyzed by adjusting all

expenses from equipment costs, to engineer salary, to amount of time the engineer works on

equipment by an increase of 25% for a worst cas e, and decreasing by 25% for a best case.

The best case and worst case result in 55% and 28% IRR respectively.

# Exhaust Gas Cleaning Systems 19 The Glosten Associates, Inc

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# Combinations – High Sensitivity . Table 12 provides worst a nd best case combinations for

our baseline ship/route pair, a ten-year life cycle, and an a ssumed discount rate of 10%. The

worst case assumes that fuel price escalati on averages only 2%, a nd that expenses are

generally 25% higher than expected. The be st case assumes a fuel price escalation on

average of 11% with expenses lower by 25%. The resulting IRR ranges from 6% to 62%,

with the worst case indicating a negative NPV.

Table 12. Life Cycle Cost Sensitivit y, Combinations for Worst/Best Cases

Ship/Route Pair Containership

Alaska to

Puget Sound Containership

Alaska to

Puget Sound Containership

Alaska to

Puget Sound Containership

Alaska to

Puget Sound

Scrubber Type Open Loop Open Loop Open Loop Open Loop

Sensitivity Analysis Expenses Low Predicted High V. High

Combination of Variables Fuel/CPI

‐ PPI 11/5 8/3 5/2 2/1

VARIABLES

‐ CONTROLLED

Investment Terms

Life Cycle (# of Years) 

# 10 10 10 10

Analysis Date (Today) (Year) 

# 2011 2011 2011 2011

Scrubber Installation Date (Year) 

# 2014 2014 2014 2014

Discount Rate (%) 

# 10.0% 10.0% 10.0% 10.0%

Capital Expense for Scrubber

Equipment (Today) (USD/One Time) 

# $3,795,000 $5,060,000 $5,566,000 $6,325,000

Engineering/Design (% Equip Cost) 

# 5.0% 7.0% 9.0% 11.0%

Training/Documents (% Equip Cost) 

# 2.0% 2.0% 2.0% 2.0%

Install/Commission (% Equip Cost) 

# 40.0% 50.0% 60.0% 65.0%

Operating Expense

‐ Annual

ECA Fuel Consumption (MT/Annual) 

# 9,636 9,636 9,636 9,636

Chemical Consumption (% of Fuel Cost) 

# 0.0% 0.0% 0.0% 0.0%

Scrubber Parasitic Loads (% of Fuel Cost) 

# 2.0% 2.0% 2.0% 2.0%

Distillate Calorie Correction (% of Fuel Cost) 

# 4.0% 4.0% 4.0% 4.0%

HFO Process and Heating (% of Fuel Cost) 

# 0.8% 0.8% 0.8% 0.8%

Operating Engineer (Today) (USD/Annual) 

# $200,000 $292,000 $350,000 $400,000

Operating Engineer (% of Position) 

# 25.0% 50.0% 75.0% 100.0%

M&R Equipment (% Equip Cost/Annual) 

# 2.0% 4.0% 6.0% 8.0%

Variables

‐ Uncertain

Fuel Differential (Today) (USD/MT) 

# $255.50 $255.50 $255.50 $255.50

Fuel/Chemical Escalation Rate (%

‐ Annual for Op Period) 

# 11.0% 8.0% 5.0% 2.0%

Personnel Inflation Rate (%

‐ Annual for Op Period) 

# 5.0% 3.0% 2.0% 1.0%

Equipment Inflation Rate (%

‐ Annual for Op Period) 

# 5.0% 3.3% 2.0% 1.0%

Analysis Results

‐ Overview (Nearest $1,000)

Capital Cost (USD

‐ Year Zero Dollars) 

# (6,458,000) (8,868,000) (10,100,000) (12,405,000)

Expenses

‐ Year One (USD

‐ Year One Dollars) 

# (407,000) (623,000) (849,000) (1,124,000)

Fuel Savings

‐ Year One (USD

‐ Year One Dollars) 

# 3,737,000 3,350,000 2,993,000 2,665,000

Net Present Value (USD

‐ Present Dollars) 

# 25,397,000 14,562,000 6,372,000 (1,964,000)

Internal Rate of Return (%) 

# 62% 36% 22% 6%

# Exhaust Gas Cleaning Systems 20 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# Section 4 Scrubbing Technology Options

“Which EGCS technology will work for my fleet?”

Scrubbing technologies are genera lly categorized as either wet or dry systems. There is

essentially one option for the dry system whereas the wet system has at least three variants.

Each of the wet and dry options will be describe d in this section to pr ovide a sense of their

relative merits.

Appendix A of this Guide provides an extensive survey of the available scrubbers. Please

use this survey to perform comparisons betw een systems in terms of technology approach

and physical plant integration. This section discusses the various technologies in general

terms.



# 4.1 Wet Systems

A wet scrubbing system is one which uses either untreated seawater or treated freshwater as

the scrubbing agent to remove SOx and particulate matter from exhaust gas. The water

undergoes some form of filtration or chemical treatment before being discharged overboard

or re-circulated to the system. Wet system s may be categorized as open loop, closed loop,

or hybrid. Specific functional differences between the three variants are outlined below.

4.1.1 Open Loop System

An open loop system relies exclusively on ambien t seawater for exhaust gas scrubbing. The

term ‘open loop’ is used because 100% of the water drawn in from the sea is discharged

after passing through the system. The process relies on the natural alkalinity of seawater to

facilitate scrubbing of the sulfur oxides.

In this process seawater is drawn from be low the waterline and pumped to a scrubber

located in the engine exhaust uptake. The scr ubber is a passive device that puts the water in

direct contact with the exhaust gas. Internal baffles divide the scrubber into several stages;

each stage causing different interactions between the gas and water. Seawater is injected

near the top through special no zzles and gravitates to the bottom passing through the various

stages.

Upon leaving the scrubber the wa ter (now termed wash water) must be processed before

discharge to the sea. Wash water is either pumped or drained via gravity to a cyclonic

separator; another passive device which relies on internal baffles to induce fluid rotation.

This rotation causes centrifuga l separation of the heavy susp ended particulates from the

water. The particles, mostly silt from the ambient seawater, are dr ained away as sludge

while the water is allowed to continue through the process.

A secondary stream of seawater which has bypa ssed the entire scrubbing process is mixed in

equal parts with the water leaving the cyclonic separator. This mixing effectively dilutes the

wash water bringing the pH to a level that is acceptable for overboard discharge in most

areas.

# Exhaust Gas Cleaning Systems 21 The Glosten Associates, Inc

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# Figure 1. Open Loop System (Hamworthy Krystallon)



# Advantages of the open loop system include the following:

 The process requires no hazardous chemicals; seawater is the only scrubbing agent.

 The system has fewer components than other wet systems.

Disadvantages of the open loop system include the following:

 Operation in brackish or fr esh water or in high water temperatures can inhibit

scrubbing of SOx.

 The discharge of effluent with acidic pH may be restrict ed in some regions, thereby

requiring a switchover to low sulfur fuel or an alternative scrubbing system.

4.1.2 Closed Loop System

A closed loop system uses fresh water that is chemically treated to effect scrubbing. The

term ‘closed loop’ is used because most of the scrubbing agent is re-circulated with only

minimal water intake and effluent discharge. Ch emical dosing is added at the rate needed to

neutralize SOx in the exhaust gas.

Fresh water that has been dosed with sodium hydroxide solution is pumped from a holding

reservoir to a scrubber. The scrubber operates in the same ma nner as that used in open loop

systems; putting exhaust in direct contact wi th the fluid. After scrubbing the water is

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# drained back to the reservoir. A seawater / fr eshwater heat exchanger extracts heat from the

closed fresh water loop, the seawater be ing supplied by an independent SW pump.

As this process repeats the chemical reacti on between the Sodium Hydroxide and the SOx

depletes the reserves of NaOH in the solu tion. A dosing unit injects NaOH at the rate

necessary to maintain a constant pH at the scr ubber outlet. To purge the benign products of

reaction (sulfates) a small flow of water is c onstantly drained from th e reservoir. At the

same time make-up water from the ship’s fresh or potable water system is added to maintain

the same volume in the reservoir. The drai ned water is sent to a treatment unit for

processing.

The treatment unit is a mechanized centrifugal separator similar to those employed in fuel

oil and lube oil systems. The separator extract s the heavy particulates and discharges clean

water as effluent. The effluent is discharged in relatively small volumes (compared to open

loop systems) and may be sent to a holdi ng tank to avoid di scharging in port.

Figure 2. Closed Loop System (Wärtsilä)



# Advantages of the closed l oop system include the following:

 The system can operate in all regions regardless of seawater alkalinity or

temperature.

 Effluent may be stored on board for what ever duration the tank volumes will permit.

Disadvantages of the open loop system include the following:

 The system has more components than an open loop system.

# Exhaust Gas Cleaning Systems 23 The Glosten Associates, Inc

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#  The system requires a constant supply of sodium hydroxide solution, a hazardous

substance requiring special hand ling, care, and cost. In addition, the use of caustic

chemicals increases the effort to gain regulatory approval.

4.1.3 Hybrid System

A hybrid system capitalizes on the advantages of the open and closed loop systems. The

system largely resembles a closed loop sy stem but incorporates additional components

which allow it to operate as either an open or closed loop system. Th e intent is that the

system can operate as an open loop system at se a to conserve chemical agent or operate as a

closed loop system in port to avoid issues stemming from water quality or port discharge

regulations.

The hybrid system has all of the same component s that are present in the closed loop system,

with the primary distinction being the presen ce of two wash water treatment devices.

Because the open loop mode of operation require s 100% of the water to undergo centrifugal

separation it is therefore nece ssary to have a secondary devi ce large enough for the higher

flow rate.

To change from the closed loop mode to the open loop mode requires a change in the

functions of certain components.

 The seawater pump used to provide cooling water to the heat exchanger in closed

loop mode becomes the supplier of dilution water in the open loop mode. The heat

exchanger is bypassed in open loop mode.

 The pump used to circulate fresh water in closed loop mode becomes the source of

seawater for the scrubber in open loop mode.

The change in modes requires change-over fr om the small volume centrifuge to the large

volume cyclone separator. Otherwise, system operation is the same as described in the

above sections.

The same advantages and disadva ntages described above are a pplicable to this system.

There is an additional disadvant age in that the system require s the most components of any

wet option.

# Exhaust Gas Cleaning Systems 24 The Glosten Associates, Inc

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# Figure 3. Hybrid System (Aalborg Industries)



# 4.1.4 Wet Systems Claiming NOx and CO2 Reductions

New variants of the wet scrubber system have begun to emerge with claims of significant

NOx and CO2 reductions. Ecospec Marine of Singapore is claiming significant reductions

in NOx and CO2 emissions with their CSNOx system while Simulation Tech, Inc. (STI) of

South Korea is claiming significant reductions in CO2 emissions in their wet scrubber units.

The CSNOx system claims: “Meet 0.1 % low sulfur fuel emission criteria. No need to use

distillate or modify the fuel system to accomm odate the use of distillate. Meet NOx Tier 1,

2 and 3 requirements. Surpa ss all present intern ational GHG mitigation targets.” (MEPC 60

Presentation.) Compliance with IMO wash water requirements is also claimed.

The CSNOx first stage scrubber is effectively an open loop wet scrubber with similar wash

water handling techniques. A second stage scru bber uses seawater that has been specially

conditioned by “ultra low frequenc y” waves that results in alka line seawater that reportedly

absorbs the remaining SOx as well as NOx and CO2. The NOx is reported by Ecospec to

convert to nitrogen gas, relievi ng concern of exceeding nitrogen limits in the seawater. The

CO2 is reported to permanently convert into bicarbonate

The CSNOx is continuing to undergo ve rification testing on the motor tanker White Star

. ABS has confirmed measurements taken validat ing reductions under some load conditions

in the first of three planned pilot project tests. If full scale testing prov es to be as effective

as the initial claims this would truly be a remarkable technology. W ithout further empirical

evidence, it would be premature for Owners to commit to this solution.

# Exhaust Gas Cleaning Systems 25 The Glosten Associates, Inc

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# Figure 4. Pilot Scale Ecospec Installation



# 4.2 Dry Systems

Dry exhaust scrubbing systems are so describe d because they rely primarily on dry bulk

reactants for treatment of the exhaust gas. The process utilizes cal cium hydroxide in the

form of spherical pellets. Th e pellets are loaded on the ship and stored in bulk. When the

system is in use the pellets are fed via belt conveyor to a dry reacto r or ‘absorber’ through

which the engine exhaust passes. The SOx r eact chemically with the pellets to produce

gypsum (CaSO 4 

# ) and water. The gypsum is removed from the bottom of the absorber by a

discharge conveyor and captured for storage and subsequent offloading.

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# The gas travels from the absorber to an SCR reactor where NOx is chemically removed from

the gas with the injection of ammonia or urea. A large volume blower on the outlet of the

SCR reactor pulls the gas through the system, thereby reducing the back pressure at the

engine exhaust outlet.

Advantages of the dry system include the following:

 The system does not produce any liquid effluent for over board discharge.

 The system can reduce NOx emissions.

Disadvantages of the dry system include the following:

 The ship must have suitable storage and handling arrangements to accommodate the

dry bulk reactants and products, as well as a reliable suppl y of materials.

 Increased costs from use of urea for NOx abatement, and calcium hydroxide for SOx

abatement.

Figure 5. Dry System (Couple Systems)



# 4.3 Fuel Switching

Fuel switching to low sulfur fuel oil distilla tes when entering port has been practiced for

decades by vessels calling in Calif ornia waters. When the ship reaches a specified distance

from an emissions control area (ECA), it in itiates the process of switching from burning

high sulfur fuel oil to burning low sulfur fuel oil. The duration of the switchover typically

takes about one hour, depending on system component size and fuel burn rate. Technical

Considerations of Fuel Switching Practices was published on 3 June 2009, by the API

Technical Issues Workgroup and the ABS Fuel Switching Advisory Notice , both of which

provide guidance on the below topics related to propulsion shutdown issues such as:

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#  Sticking/scuffing of fuel injection components as a result of the

o thermal shock or reduced viscosity and lubricity, and

o incompatibility of fuels being switched (complete fuel pump seizure).

 Mismatched crankcase or cylinder lubricati on oil resulting in accelerated piston/liner

wear.

 Liner lacquering resulting in difficulties maintaining oil film thickness.

These risks can be mitigated by a combination of the installation of special equipment and

the modification of operational procedures. Th e extent and nature of conversion required

for a vessel will be determined by the type of equipment installed on the vessel, and the

arrangement of the affected systems. For ve ssels not already outfitted with special fuel

switching equipment, modificati on costs will generally range from $15K to $80K. This

assumes that the vessel has the appropriate ta nk capacity to carry the two fuel types.

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# Section 5 Integration, Operations, and

Maintenance Practicality

“Can an EGCS be practically inte grated with ship operations?”

Installation of an EG CS will place additional demands on those responsible for plant

operation and maintenance. The decision to in stall an EGCS should consider the additional

manpower required to sustain operation. De pending on a ship’s current operations and

maintenance profile, installation of an EGCS ma y require additional crew. This section will

outline the major sources of additional labo r associated with each type of system.

At this time there is insufficient empirical data from which to deri ve actual operating and

maintenance data. In order to quantify the manpower requirements of an EGCS system a

comparison shall be drawn between each ma jor EGCS component and more common

(existing) shipboard equipment of similar complexity.

What follows are discussions (grouped by syst em) identifying the general complexity and

manpower requirements of each component.



# 5.1 Physical Integration Challenges – All Systems

The installation of exhaust gas cleaning system s (EGCS) present integration challenges to

new builds and retrofits alike. Appendix A provides summary information of several EGCS

including footprints, weights, and backpressures. This will provide each operator a baseline

on which to begin discussions with suppliers on integration. Key cons iderations include:

 Weight and stability. Wei ghts will vary significantly by scrubber rating and type.

The primary weights of concern are the scrubbers themselves as they are positioned

high and even a 20 ton wet weight could be of significant concern for ships that have

limited remaining stability margin.

 Water handling systems. These systems can be significant for any of the wet

systems, but particularly for open loop and hybrid systems. For example, a 50

megawatt plant with an open loop scrubber will require 4,500 cubic meters an hour

of wash water. This wash water would require about 0.5 megawatts of power to run,

and a 760 mm pipe (30 inch diameter).

 Machinery and stack arrangements. In the case of new builds, the EGCS will

become a primary component for arrangement s and weight allowances. For retrofits,

fitting this equipment into existing spaces will be a significant challenge and in some

cases may require installation of the scrubbe r unit in the weather or new above the

main deck enclosure.

 Exhaust backpressure. Most engines can tolerate ~3.0 kPa of backpressure (12

inches of water) without significant degrad ation of power or adverse affects.

Exceeding the allowance will degrade performance by ~ one percent for each

additional 3 kPa of backpressure. It s hould be noted that exhaust piping and

silencers may required, depending on the scr ubber design. If one is required, then

backpressure allowances should be included.

 Electrical power. The demands of these sy stems can be significant reaching 2% of

nominal power, potentially requiring additional generating capacity.

# Exhaust Gas Cleaning Systems 29 The Glosten Associates, Inc

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#  Failure modes. Being integral to diesel engine operations, a failure modes and

effects or other analysis should be conducted to assure that a scrubbe r failure will not

result in loss of ships service or propulsion power.



# 5.2 Open Loop Seawater System

Scrubber: The scrubber is a passive device that relies on the hydraulic pressure of an

external supply pump for proper operation. Inte rnally the scrubber is divided into multiple

sections for processing of the exhaust gas. There are few, if any, moving parts although

internal bypass dampers may be included. Re gular inspection, de-f ouling, and operational

checks are required. Internal filtration elemen ts in the scrubber will require periodic

replacement. The scrubbers are similar in size and service profile to exhaust gas

economizers. The Owner should anticipate a main tenance profile similar to inert gas system

scrubbers commonly found on tank ships.

Pumps and Strainers: Strainers and centrifugal pumps are ubiquitous in shipboard plants.

The service demands of the external scrubber pu mps are essentially the same as those used

for other auxiliary services such as seawater cooling with th e addition of a variable speed

control drive. The pumping demand is si gnificant with two pumps, each requiring

approximately 50 m3/hr per engine megawatt. This service profile makes for a predictable

operation and maintenance schedule.

Wash Water Treatment Filter: The wash water treatment filter is generally a passive

filtration assembly relying on fluid velocity and cyclonic baffles to effect centrifugal

separation of sludge. With no moving parts or consumable elements the device would only

require periodic inspection and de-fouling.

Sludge Handling: Sludge that is separated out in the Wash Water Treatment Filter must be

retained on board and periodically discharged to a shoreside reception facility. The sludge

may be retained in existing shipboard sludge ta nks, but the pump-out interval will decrease

requiring more frequent sludge tr ansfers. Existing reports on scrubber sludge indicates that

it is not hazardous, and therefore does not need to meet IMO Annex I handling

requirements. However, Annex VI does not allow incineration of EGCS sludge.

Effluent Monitoring: Instrumentation used to monito r effluent conditions will require

periodic calibration, inspection, and possible element re placement. The monitoring of

turbidity is a common function of oil conten t monitors used in shipboard oily water

separators. It is reasonable to expect that the degree of inte rvention required will be similar

for the scrubber effluent instrumentation. Sc rubber monitoring will however be continuous

and requires monitoring of at l east three parameters, in comparison to oil content monitor of

a single parameter performed only periodically.

Exhaust Gas Monitoring: The instrumentation used for monitoring of scrubbed exhaust

gas is not unlike that used in tank vessel in ert gas monitoring. Scr ubber monitoring however

will be continuous as per regulation, and requi res monitoring of more difficult parameters

such as SO2. The Owner should anticipate th e need for periodic ca libration, servicing of

calibration gases, inspection, and possible elem ent replacement. Type Approval processes

for this equipment will be required for Scheme B, including third party calibrations and

maintenance, are anticipated.

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# Controls: The controls for an open loop syst em should not impose any significant

operational or maintenance costs. Modern PLC/microprocessor controls are robust and

generally do not require any attention beyond periodic inspecti on and testing of the power

supplies.



# 5.3 Closed Loop Freshwater System

Buffer Tank: The buffer tank is a passive device, ac ting simply as a reservoir where the

solution is allowed to stabilize. The tank has no internal moving parts and, besides periodic

inspection, would require little or no operator intervention.

SW/FW Heat Exchanger: The SW/FW heat exchanger is re quired to remove heat that is

absorbed by the solution as it passes through the scrubber. Although this is a passive device

the Owner should anticipate the need for regul ar disassembly and cleaning of both FW and

SW sides of the heat transfer surfaces.

Pumps and Strainers: The SW and FW circulation pumps will experience the same

operational demands as those present in the open loop system. Again, this represents a

predictable addition to the sh ip’s maintenance workload.

Sodium Hydroxide Unit: The NaOH unit is used for storage and dosing. Generally it is a

passive device and should require little operato r intervention. However, the loading of the

alkaline solution is a critical operation that requires diligence and strict adherence to safety

procedures. Due to the hazardous nature of the chemical Owners should plan for a tightly

controlled evolution requiring several crew me mbers to remain present and fully attentive

during a transfer. This proce dure would take place at regular intervals during port stops and

is a significant addition to the list of duties assumed by the ship’s crew.

Water Treatment Device: The water treatment device is a mechanized centrifugal

separator similar to those commonly used for fu el oil or lube oil processing. An owner

should expect at least the same degree of operator interventi on; regular operational checks

and moderate to frequent disassembly and cleaning.

The system contains additional elements which are substantially similar to those found in the

open loop system. These components include

 Scrubber

 Effluent Monitoring Devices

 Exhaust Gas Monitoring Devices

 Controls

 Sludge Handling



# 5.4 Hybrid System

The hybrid system has the ability to operate as an open loop system at sea and operate as a

closed loop system in port. The system make -up is virtually the same as the closed loop

system. Through the use of isolation valves, th e circulation pumps can serve different roles

depending on which mode the system is being used in.

One substantial deviation from the closed loop system is that the hybrid system must have

two separate wash water treatm ent devices; one for each mode of operation. The open loop

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# mode requires a large device capab le of processing 100% of the system flow rate, whereas

the closed loop treatment device only proce sses a fraction of the system flow rate.



# 5.5 Dry System

Absorber: The absorber (sometimes called the r eactor) is the primary component involved

in the dry scrubbing process. It is a large assembly mounted in the exhaust uptake which

funnels the hot exhaust gas th rough a bed of calcium hydroxide pellets. The gas comes in

direct contact with the pellets causing a ch emical reaction which removes entrained SOx.

The device is passive relying on external conv eyors to feed unspent pellets and remove

spent pellets. The absence of moving parts makes the device relatively easy to maintain, but

periodic inspections of the internals should be conducted.

Conveyors: Conveyance of the dry chemical reactants and by-products to and from the

absorber is accomplished with mechanical conve yor belts. These would be similar to those

used in bulk ship cargo handling and would require frequent inspection and planned

maintenance of the rotati ng elements and belts.

SCR Reactor: The selective cat alytic reduction (SCR) reac tor is the component where

NOx are removed from the exhaus t gas via chemical reaction with an injected chemical. A

liquid reactant such as ammoni a or urea is injected and mixed into the exhaust stream

thereby reacting with the NOx and precipitating benign by-products . The reactor itself has

no moving parts but it is reliant on extern al pumping and chemical storage devices.

Exhaust Gas Blower: A large volume blower is used to pull treated exhaust gas from the

outlet of the absorber. As with similar large blowers (e.g. IG system blowers, forced draft

fans) the device will require regular operational checks and m oderate maintenance tasks.

Isolation and Bypass Dampers: The dampers used to divert the flow of exhaust gas

through or around the absorber are essentially larg e butterfly valves designed for service in

high temperature applications. Such damper s prevail in tankship IG systems for gas

isolation. Periodic maintenance of seals a nd damper actuators will be required.

Calcium Hydroxide Storage: A closed, dry storage hopper is used as a reservoir for the

unspent calcium hydroxide pellets. The hopper itse lf requires little or no attention from the

ship’s crew, but regular dry bulk loading operations must be carried out and supervised. It is

improbable that all shoreside terminals will have the necessary handling equipment for

loading the product in bulk. Therefore the Own er should plan for the contingency that the

bulk products may need to be loaded in packag ed form and transferre d (internally) by the

ship’s crew to the hopper. Depending on the intervals between load ing and the volumes

being loaded this evolution could require si gnificant manpower if performed as described.

Hydraulic cranes or similar means must be added to the vessel if they are not already

installed.

Gypsum Storage: As with the calcium hydroxide pe llets, the reacti on byproduct gypsum

must be retained on board and discharged at re gular intervals. A similar challenge is faced

in the respect that not all shoreside terminals will have equipment or reception facilities that

can easily remove the spent pellets en masse. Possible ship-based solutions include the

following:

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#  Compressed air ‘blow tanks’ similar to thos e used for transferri ng bulk drilling mud

in offshore supply vessel applications. This requires a large pressure vessel tank and

dedicated air compressor(s) to effect dry bulk transfer. It also requires a shore side

facility that can accept large flow rates of dry bulk material through a pipeline.

 Manual option; essentially the reverse of the loading option described above. This

would require that the vessel have on-board portable containers which can be filled

by the crew at the base of the gypsum stor age hopper. Portable containers then

removed by crane or hoist.

The system contains additional elements which are substantially similar to those found in the

wet systems. These components include

 Exhaust Gas Monitoring Devices

 Controls



# 5.6 Summary

The following tables compare the components for each type of system to the conventional or

existing shipboard equipment items.

The addition of any type of EGCS will incr ease the workload for shipboard engineering

personnel. The ability of a ship’s crew to abso rb this increase in workload is dependent on

the current manning levels and utilization. Thes e factors are in many ways linked to the ship

type.

For instance, the engineering plant on board an ocean-going containership is less complex

than the plant on board a tank vessel. A tank ve ssel carrying oil or ch emicals has on-board

cargo pumping and inert gas systems which do not exist on dry cargo ships, and which

require constant supervision dur ing cargo operations. Therefor e, it is possible that the

engineering department on a dry cargo ship may be capable of absorbing the additional

workload without an increase in manning.

The ship type also carries with it certain regu latory barriers which may further limit a crew’s

ability to carry the additional workload. Cr ews on board U.S. registered tank ships are

limited by OPA 90 regulations to work no more than 12 hours in a 24 hour period. It would

not be possible for an Owner to simply make the crew work longer days to compensate for

the increase in workload.

In summary, the table and discussions are intende d to give the reader a general sense of how

much burden an EGCS will introduce. Ultimat ely, the Owner must weigh this information

against known variables such as ship type, cr ew utilization, and watc h-keeping regulations.

A prudent approach may be to start operations with an additional crew member specifically

trained to operate the EGCS, and subsequently shift these burdens to other crew members as

possible.Exhaust Gas Cleaning Systems 33The Glosten Associates, IncSelection Guide, Revision A File No. 10047.01, 22 February 2011Table 15. Comparison Chart for Open Loop, Closed Loop, and Hybrid Wet SystemsExhaust Gas Cleaning Systems 34The Glosten Associates, IncSelection Guide, Revision A File No. 10047.01, 22 February 2011Table 16. Comparison Chart for Dry SystemsNo MarineComparisonDry BulkConveyorNo MarineComparisonInert Gas SystemBlowerInert Gas SystemDamperIG MonitoringInstrumentationPLC /MicroprocessorDry BulkHopperDry System ComponentsAbsorberFeed ConveyorExtraction ConveyorSCR ReactorExhaust Gas BlowerBypass DamperInlet Isolation DamperOutlet Isolation DamperExhaust Monitoring InstrumentationControl ModuleCalcium Hydroxide StorageGypsum StorageConventional or Existing Shipboard Equipment

# Exhaust Gas Cleaning Systems 35 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# Section 6 Discussion

The ship operator considering an exhaust ga s cleaning system (EGCS) faces a conflicting

pair of recommendations. On the one hand, the fuel cost savings for those operating within

an emissions control area (ECA) is so substantial that an EGCS may be a competitive

necessity. On the other hand, installations ar e discouraged because the technology is not yet

fully mature, places a significant burden on sh ip arrangements and operations, and raises

some environmental impact concerns. Th is section provides a discussion on these

considerations.



# 6.1 Cost Advantage

The cost advantage for EGCS is a combination of quantity of fuel burned within an ECA

and the cost differential between the high-sulfur and low-sulfur fuel. The analysis in this

Guide indicates that starting in 2015, ships that burn at least 4,000 metr ic tons of fuel oil

annually within an ECA should consider an EGCS.

A key break point in fuel cost differentials is when sulfur limits become so low, that they

cannot be practically or cost -effectively achieved by removing sulfur from residual fuel.

Such limits, generally 0.5% sulfur or lower, require high-cost dist illate fuel oil or

alternatives such as EGCS or natural gas. The potential cost savings for an EGCS is then

the differential between the high-cost distil late and the low-cost residual fuel oil.

Such differentials are currently in effect in EU ports and Calif ornia coast waters that limit

fuel sulfur concentrations to 0.1% sulfur. The cost advantage becomes widespread in 2015

when IMO enacted ECAs will require the 0.1% sulfur emissions. When worldwide sulfur

limits reach 0.5% in either 2020 or 2025 the co st savings opportunity extends to ships

regardless of thei r operating area.

Over the last eight years residual fuel has cost roughly 50% less than di stillate fuel. On 10

January 2011, the cost differential between MGO and IFO380 in Los Angeles was about

$250 per metric ton (bunkerworld.com). It is difficult to predict how this differential will

change over time. The cases analyzed in this Guide assume that the percentage differential

will remain constant, and that fuel cost escalation will average 8% annually over the

assumed ten-year life-cycle pe riod. Based on these assumptions , net present values between

$4.8M and $20M, and internal rates of return between 20% and 53% ar e calculated. Ship

operators are encouraged to ut ilize their own fuel cost di fferential predictions, as the

analysis is very sensitive to fuel cost escalations.



# 6.2 Ship Impacts

The impact of an EGCS on sh ip arrangements, operations, an d logistics is both broad and

pervasive. The machinery is very large, im pacts key mechanical, el ectrical, and control

systems, and in the case of chemical based systems requires impacts logistics for bunkering

and safety response.

In spite of these cha llenges, the cost savings potential re mains significantly high. The ship

operator installing an EGCS will need to return some of that cost savings to ensure success

operations. An EGCS will require a significant investment to ensure adequate installation

# Exhaust Gas Cleaning Systems 36 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# and commissioning, ongoing technical support, in itial and ongoing training, and most likely

an increase in shipboard engi neering staff. Without this commitment of resources,

installation of an EGCS is not recommended.



# 6.3 Applicability to n on-Ocean Going Vessels

Exhaust gas cleaning systems offer significant be nefits to non-ocean going vessels in terms

of abating PM, NOx, and hydrocarbons. Equipment focused on these pollutants may be

significantly smaller than sulfur focused scr ubbers, and therefore may more readily fit onto

smaller vessels. However, this Guide focuses on the removal of sulfur from residual fuel.

The employment of exhaust gas cleaning systems for sulfur abatement on smaller marine

vessels, non-Ocean Going Vessels, faces several challenges: machinery spaces may be too

restricted to fit the large scrubber plants; many already burn high cost marine diesel oil

(MDO) or marine gas oil (MGO) eliminating much of the potentia l fuel cost savings; those

that burn residual fuel oil may not burn enough to gain adequate pay-back on the capital

investment.

Many smaller marine vessels, such as ocean going tugs or supply boats, have large

propulsion plants tightly fit into relatively small machinery spaces. These service vessels

are often designed around the propulsion plant, and therefore often have no additional space

for even moderate increases in equipment. One solution for some vessels will be to locate

the scrubbing equipment in the weather or in a new deck house. For small vessels, often all

exterior spaces are working areas essential to the vessel’s mission. A review of the available

area in comparison to the machinery footprints provided in the appendix of this Guide will

assist the operator with an initial evaluation.

The cost advantages of sulfur focused EGCS are dependent on the fuel cost differential

between high-sulfur residual fuel oil and low-sulfur distillate fuel oil. In general, this means

ocean going vessels that run slow speed diesel engines. There are classes of marine vessels,

such as anchor handling tugs or larger ferries , that burn residual fuel oil in medium speed

diesel engines. In these cases, the fuel has a high fuel cost differential but may not be in

significant quantity to justify the equipmen t expenses. This Guide suggests 4,000 metric

tons of fuel oil burned annually within an EC A as a point where an operator should develop

an economic analysis.

There are many vessels that burn MDO, a blend of mostly distillate with some residual fuel

oil. MDO may be burned out of convenience to avoid heavy fuel oil handling efforts, or

because the associated engine is not capable of handling the residual fuel oil. However, the

fuel cost differential between the MDO and 0.1% distillate fuel oil does not provide

adequate increase in cost to shift the advantage to EGCS installation. For example, the

Houston price for marine gas oil (most sim ilar to 0.1% sulfur distillate) was only $47.50

more per metric ton than the cost of M DO at $823.50 (bunkerworld.com 11 February 2011).



# 6.4 Environmental Regulations

EGCS supplied data indicates that the wash water from open-loop style scrubbers is

acceptable for discharge into ambient waters in accordance with international wash water

guidelines, as well as the Unite d States EPA Vessel General Permit requirements. However,

ship operators should be cautioned that the regulation of ship discharges, particularly in the

# Exhaust Gas Cleaning Systems 37 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# United States, is subject to uncertainty. For example, several U.S. states have developed

ballast water discharge requirements that conflict with international and federal

requirements.

Sulfur regulations were initially developed as fuel standards, as the sulfur is not consumed in

the combustion process, but rath er passes into the air emissions. The EGCS alternative was

accepted under the assumption that it would prov ide a similar level of emissions reductions.

However, the sulfur-based fuel standard include d an expectation that a significant reduction

in particulate matter emissions w ould also occur. This expectat ion is not part of either the

fuel standards, or the EGCS requirements. This creates uncertainty, as requirements for

particulate matter reductions may be in cluded in future EGCS requirements.

It is not clear whether a ship with an EGCS failure will be permitted to continue operations.

This will require further analysis and discussi on with regulatory authorities as the system

installations become more widely implemented. One strategy for the ship operator would be

to include an ability to switch-over the low- sulfur diesel fuel in these instances.

Alternatively, the ship operator might consider installation approaches that prevent single

point failures from impacting propul sion and/or generating capacities.



# 6.5 Experience Matters

As with any new or developing technology, th e ship operator should proceed with caution.

The most experienced EGCS suppliers have onl y a handful of shipboa rd installations, and

most only have a single pilot project. Succe ssful selection, integrat ion design, installation,

and commissioning of an EGCS will require ca reful consideration and significant effort.

The ship operator should expect that an EG CS installation will requi re ongoing support, and

potential upgrades, particularly for early installations. As such, the relationship with the

supplier and confidence in continued support are important factors when selecting a system.

# Exhaust Gas Cleaning Systems 38 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# Section 7 References

Reference 1 Corbett, J.; Wang, C.; Wine brake, J.; Green, E.; “Allocation and

Forecasting of Global Ship Emissions ,” Clean Air Task Force, Boston,

11 January 2007.

Reference 2 Hoy-Petersen, N.C.; “An EGCS conceived by Shipowners for

Shipowners,” Clean Marine AS, December 2010.

Reference 3 “An Estimate of Operating Costs for Bulk, Ro-ro and Container Ships,”

Bureau of Transport Economics (BTE), September 1982.

Reference 4 “Assumptions to the Annua l Energy Outlook,” Energy Information

Administration, March 2009.

Reference 5 Behrends, B.; Liebeseit, G.; “A Theoretical Environmental Impact

Assessment of the Use of a Seawat er Scrubber to Reduce SOx and NOx

Emissions from Ships,” Research Centre Terramare, Wilhelmshaven,

Germany.

Reference 6 “Avoiding propulsion loss from fuel switching: American Petroleum

Institute Technical Considerations,” Ma rine Safety Alert, United States

Coast Guard, Washington DC, 16 June 2009.

Reference 7 “Basic Principles of Sh ip Propulsion,” MAN B&W Diesel A/S,

Copenhagen, Denmark.

Reference 8 “Bunker Fuel Charges Fact Sheet,” TSA Carriers Organization,

http://www.tsacarriers.org/fs bunker.html, 8 December 2010.

Reference 9 Hayman, S.; “California Low Su lfur Fuel Requirements: Exhaust Gas

Scrubbers?” California Air Resour ce Board, email 17 November 2010.

Reference 10 “California Ocean Plan,” Ca lifornia Environmental Protection Agency

State Water Resources Control Board, 2005.

Reference 11 “California Ocean Plan,” Ca lifornia Environmental Protection Agency

State Water Resources Control Board, 2001.

Reference 12 “Caustic Soda Prices and Pricing Information,” ICIS.com, July 2009.

Reference 13 “China-U.S. Transpacific R oute and Sailing Schedule,” Horizon Lines,

www.horizonlines.com , November 2010.

Reference 14 Zoeteman, Peter; “Closi ng the Loop, Exhaust Cleaning Systems,”

bunkerspot, August/September 2010.

Reference 15 “Containership Propulsion – beyond Post-Panamax,” MAN B&W Diesel

A/S, Copenhagen, Denmark.

# Exhaust Gas Cleaning Systems 39 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# Reference 16 “Control of Emissions from New Marine Compression-Ignition Engines

at or Above 30 Liters per Cylinder, ” Proposed Rule, 40 CFR Parts 9 and

94, Environmental Protection Agency, 7 December 2007.

Reference 17 “Control of Emissions from New Marine Compression-Ignition Engines

at or Above 30 Liters per Cylinde r,” Proposed Rule Preamble, 40 CFR

80, 85, 86, et al., Environmental Protection Agency, 26 June 2009.

Reference 18 “Control of Emissions from New Marine Compression-Ignition Engines

at or Above 30 Liters per Cylinde r,” Final Rule, 40 CFR Parts 80, 85, 86,

et al., Environmental Protection Agency, 30 April 2010.

Reference 19 “Cost Savings & Increased Profit,” On-Board Emissions Monitoring

, MariNOx, 11 January 2007.

Reference 20 “CSNOx Greenhouse Gas Abat ement Technology: Update of CSNOx

performance on Singapore registered ship,” Ecospec, January 2010.

Reference 21 “Distances Between United Stat es Ports,” United States Department of

Commerce, National Oceanic and A tmospheric Administration (NOAA),

and National Ocean Service, 10th Edition, 2009.

Reference 22 Toombs, P.; “Emission Regulations & The Impact of Exhaust Gas

Cleaning System Technology,” Mari ne Exhaust Solutions, May 2010.

Reference 23 “Evaluation of Low Sulfur Marine Fuel Availability – Pacific Rim,”

Starcrest Consulting Group, LLC, July 2005.

Reference 24 “Exhaust Gas Cleaning, Aalbor g,” Olav Knudsen, Aalborg Industries,

July 2010.

Reference 25 Marttinen, V.; “Feasible SO x Solutions,” Wärtsilä’s Environmental

Seminar in Helsinki, 22 June 2010.

Reference 26 Filancia, A.; “Reducing Em issions from Shipping: Wärtsilä’s

Solutions,” Version 9.0, Wärtsilä.

Reference 27 van Rhynbach, E.; Briers, K.; “Fuel Storage & Handling Systems and the

Costs of Operating in ECA’s,” Herbert Engineering, presentation,

Society of Naval Architects & Marine Engineers Symposium, Operating

Ships within Emission Control Areas (ECA’s) , San Francisco, California,

28-29 April, 2010.

Reference 28 “Fuel Switching A dvisory Notice,” ABS, March 2010.

Reference 29 “Global Trade and Fuels Assessment – Future Trends and Effects of

Requiring Clean Fuels in the Marine Sector,” Environmental Protection

Agency, November 2008.

Reference 30 “Guide to Marine Emissi ons Control,” Simulation Tech, Inc., 2010.

# Exhaust Gas Cleaning Systems 40 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# Reference 31 “Guidelines for Exhaust Gas Cleaning Systems,” IMO, Marine

Environment Protection Committ ee, Resolution MEPC.170(57), 57/21,

Annex 4, 4 April 2008.

Reference 32 “Guidelines for On-Board Exhaust Gas-SOx Cleaning Systems,” IMO,

Marine Environment Protection Committee, 53/24/Add.1, Annex 12, 22

July 2005.

Reference 33 Hansen, O.; Jacobsson, J.; Jamttjam, J.; Cooper, D.; Flodstrom, E.; “The

Demo Project,” PriceWaterhouseCoopers and The Swedish

Environmental Research Instit ute, Stockholm, 22 April 2005.

Reference 34 Henriksson, T.; “SOx scrubbi ng of marine exhaust gases,” Wartsila

Technical Journal, February 2007.

Reference 35 “Holland America Line/Krystallon Sea Water Scrubber Technology

Demonstration Project,” Presentatio n, Holland America Line Web Site,

22 December 2008.

Reference 36 Hoy-Petersen, Nils; “EGCS Conceived by Shipowners by Shipowners,”

Clean Marine AS, 2010.

Reference 37 “Low Sulfur Fuel: Im pacts on the Marine Industry, ExxonMobile

Marine Lubricants,” June 2009.

Reference 38 “Low-Sulfur Marine Fuel Av ailability Study,” Port of Long Beach and

Port of Los Angeles, 14 April 2008.

Reference 39 “Marine Exhaust Gas Scr ubber, MEPC Correspondence Group on Wash

Water Discharge Criteria,” The Eu ropean Association of Internal

Combustion Engine Manuf acturers, 29 March 2007.

Reference 40 “Marine Project Guide- Wartsila 20,” Wartsila, January 2004.

Reference 41 “Marine Scrubbing by BELCO®,” Dupont, 2010.

Reference 42 Marttinen, Vesa, “Feasible SOx Solutions,” Wärtsilä’s Environmental

Seminar, Helsinki, June 2010.

Reference 43 “Notes on Heavy Fuel Oil,” ABS, 1984.

Reference 44 “Prevention of Air Polluti on from Ships, Advice by GESAMP on the

interim criteria for discharge of wa shwater from Exhaust Gas Cleaning

Systems for removal of sulphur-oxides,” IMO, Marine Environment

Protection Committee, 59/4/19, 59 th 

# Session, Agenda Item 4, 8 May

2009.

# Exhaust Gas Cleaning Systems 41 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# Reference 45 “Prevention of Air Polluti on from Ships, Proposed amendments to

resolution MEPC.170(57) – Guidelines for Exhaust Gas Cleaning

Systems,” IMO, Marine Environment Protection Committee, 59/4/31,

59 th 

# Session, Agenda Item 4, 8 May 2009.

Reference 46 “Prevention of Air Polluti on from Ships, Proposed amendments to

resolution MEPC.170(57) – Guidelines for Exhaust Gas Cleaning

Systems,” IMO, Marine Environm ent Protection Committee, 59/10/5,

59 th 

# Session, Agenda Item 10, 10 April 2009.

Reference 47 “Prevention of Air Pollution from Ships, Proposed draft changes to

resolution MEPC.130(53),” IMO, Ma rine Environment Protection

Committee, 56/4/4, 56 th 

# Session, Agenda item 4, 3 May 2007.

Reference 48 “Prevention of Air Pollution fr om Ships, Washwater discharge criteria

for EGCS-SOx units,” IMO, Marine Environment Protection Committee,

55/4/7, 55 th 

# Session, Agenda item 4, 4 August 2006.

Reference 49 “Proposal of Emission Contro l Area Designation fo r Geographic Control

of Emissions from Ships,” Environmental Protection Agency, April

2009.

Reference 50 “Proposed Amendment to Regulations 13 and 14 Implementing the

Proposed Emission Control Area,” IM O, Marine Environment Protection

Committee, 59/6/5, Annex 4.

Reference 51 “Propulsion Trends in Bu lk Carriers,” MAN B&W Diesel A/S,

Copenhagen, Denmark, 22 February 2006.

Reference 52 “Propulsion Trends in Cont ainer Vessels: M AN B&W Two-stroke

Engines,” MAN B&W Diesel A/S, Copenhagen, Denmark.

Reference 53 “Propulsion Trends in Tanke rs,” MAN B&W Diesel A/S, Copenhagen,

Denmark.

Reference 54 “Record Fuel Prices Plac e Stress on Ocean Shipping,” World Shipping

Council, 2 May 2008.

Reference 55 “Regulation on Fuel Sulfur and Other Operational Requirements for

Ocean-Going Vessels within California Waters and 24 Nautical Miles of

the California Baseline,” CARB Marine Notice 2009-1, 5 May 2009.

Reference 56 “Regulations for the Preven tion of Air Pollution from Ships,” IMO,

Marine Environment Protection Committee, 58/23/Add 1, Annex 13, 17

October 2008.

Reference 57 “Regulatory Announcement: Proposal of Emission Control Area

Designation for Geographic Contro l of Emissions from Ships,”

Environmental Protection Ag ency, EPA-420-F-09-015, March 2009.

# Exhaust Gas Cleaning Systems 42 The Glosten Associates, Inc

Selection Guide, Revision A F ile No. 10047.01, 22 February 2011 

# Reference 58 “Report of the Marine Envi ronment Protection Committee on its FiftyEighth Session,” IMO, Marine Environment Protection Committee,

58/32/Add.1, 58 th 

# Session, Agenda Item 23, 17 October 2008.

Reference 59 Karle, I.M.; Turner, D. ; “Seawater Scrubbing – reduction of SOx

emissions from ship exhausts,” Th e Alliance for Global Sustainability,

Göteborg, 2007.

Reference 60 “Scrubbing Technology Update ,” Hamworthy Krystallon Presentation,

SMM Hamburg, 2010.

Reference 61 Henriksson, T.; “SOx-Scrubbing of Marine Exhaust Gases” Wärtsilä,

presentation, Exhaust Gas Cleaning Systems Association, Hamburg, 8-9

September 2010.

Reference 62 “Summary and Analysis of Co mments: Control of Emissions from New

Marine Compression-Ignition Engine s at or Above 30 Liters per

Cylinder,” United States Environmental Protection Agency, December

2009.

Reference 63 “Technical Code on Control of Emission of Nitrogen Oxides from

Marine Diesel Engines,” IMO, Marine Environment Protection

Committee, 58/23/Add 1, Annex 14, 17 October 2008.

Reference 64 “Technical Cons ideration of Fuel Switching Practices,” API Technical

Issues Workgroup, 3 June 2009.

Reference 65 “Tote Orca Class Trailershi p Fact Sheet,” The General Dynamics

Corporation/NASSCO, 14 December 2010.

Reference 66 “Vessel General Permit for Discharge Incidental to the Normal

Operation of Vessels (VGP),” Environmental Protection Agency and

National Pollutant Discharge Elim ination System, 5 February 2009.

# Exhaust Gas Cleaning System s, Selection Guide The Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 

# Appendix A Exhaust Scrubber Technology Survey

This Appendix summarizes the Ship Opera tions Cooperative Progr am (SOCP) marine

exhaust gas cleaning system (EGCS) supplier survey results.

The following information was provided by equipm ent suppliers, and comp rises self-certified

data on their system particulars and performance. The purpose of this data is to allow SOCP

members to indentify one or more technologies that may be suitable for their ship(s).

Members may then contact supp liers directly for detailed integration and commercial

discussions.

Response Description



# None Confirms a zero quantity.

DNA Inquiry does not apply to technology.

TBD Inquiry either not answered or unclear.

# Exhaust Gas Cleaning System s, Selection Guide A-1 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 

# Vendor Summary

Systems are compared at a high level in the following table. System details are provided on the following

pages.

** Vendor Name Unit Size*

Range

(MW) Claimed

Reductions Land-Based

Installs Shipboard

Installs System Type System

Details



# 1 Aalborg Industries 1 to 80 99% SO

x 

# 30-80% PM One: 1 MW One: 21 MW Open/Closed

Loop Hybrid p A-2

2 BELCO Clean Air

Technologies (Dupont) 2 to 200 >97% SO

x 

# Multiple:

2 to 200 MW None Open Loop &

Closed Loop p A-7

3 Cleanmarine, aka The Torrald

Klaveness Group No response from vendor.

Couple Systems 1 to 60 99% SO 2 

# Multiple:

3 to 100 MW One: 3.6 MW Dry EGCS p A-10 4 60% HC

Ecospec/CSNOx 99% SO 2



# One: TBD One: 5 MW Open Loop

System p A-13 66% NO

x 

# 5 77% CO 2



# Hamworthy Krystallon 0.5 to 60 99% SO

x 

# Three: 0.4, 1.0

& 2.2 MW Three: 1.0, 8.5 &

10 MW Open Loop

System p A-17 6 60% PM

7 Marine Exhaust Solutions 0.3 to 5.6 74-80% SO

x 

# DNA Nine: Eight at 23

MW, One 15 MW Open Loop

System p A-21

8. Wärtsilä Finland Oy 0.68 >99% SO

x 

# DNA One: 0.68 MW Closed Loop

System p A-24

* Unit size refers to diesel engine size served. Boiler units are not considered in this survey.

** Vendors are listed alphabetically and not by price or efficiency.

# Exhaust Gas Cleaning System s, Selection Guide A-2 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 

# Aalborg Industries Exhaust Gas Cleaning B.V., 1 of 5 pages

Contact 

# René Diks, +3 (0)24 352 3100, rdk@aalborg-industries.com

Website: www.aalborg-industries.com

Technology Type(s) 

# EGC system, Combined Open

Loop (Salt Water) and Closed

Loop (Fresh Water)

No Dry Chemical Other Products 

# The EGC system can incorporate a

venturi system (non standard) to

capture PM up to 80%

Exhaust Monitoring

IMO Scheme 

# Scheme B Vessel Install Contact 

# Olav Knudsen Aalborg Industries

System Availability 

# 1 MW to 50 MW Size, Land Based

Install 

# 1 MW, in 2008

Development Phase 

# Prototype Size, Shipboard Install 

# 21 MW, in 2009

Failure Modes 

# If an interruption occurs, the

bypass valves open and the

exhaust gas flow will bypass the

EGC system. Failure Recovery 

# The problem must be solved after

which the system will return to

normal operation automatically. The

EGC can be remotely checked on

trouble shooting by Aalborg

Industries.

Unit

Size*

(MW) Commercially

Available

(Yes/No) Land-based

Trial

(Year/Units) Shipboard

Trial

(Year/Units) Efficiency

Results

Available

(Yes/No) How Many Hours of

Operation? Notes



# 1MW Yes 2008 DNA Yes 150 Landbased test (in

cooperation w/MAN)

21MW Yes DNA 2009 Yes 1000 System in test since

April 2010 (on DFDS

Tor Ficaria )

* Unit size refers to diesel engine size served. Boiler units are not considered in this survey.



# System Efficiency Trial Results

Land-Based or Shipboard Trial 

# Landbased at Holeby (Fresh

Water) Test Date 

# Oct 2008 – Jan

2009

Engine Make/Model 

# MAN 5L21/31 50Hz Rated Power (MW) 

# 1MW

Fuel Grade (RMG35, RME25, DMB, DMA) 

# 2, 4% S Trial Load (MW) 

# 25-50-75-100%

Fuel Sulfur SO2 CO2 CO2 PM 2.5 PM HC NOx CO Back

Press

(%) (ppm) (%) (g/kWhr) (kPa)

Scrubber OFF 

# 431ppm 5.5% TBD 1 TBD TBD 1050

PPM TBD 0

Scrubber ON 

# 4ppm for

Closed

Loop 5.3% TBD 0.3-0.8 TBD TBD 950

PPM TBD 1-3

Reduction (%) 

# 99% 3-8% TBD 30-80% TBD TBD 5-10% TBD TBD

\

# Exhaust Gas Cleaning System s, Selection Guide A-3 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 2 of 5 pages, Aalborg Industries Exhaust Gas Cleaning B.V.

Land-Based or Shipboard Trial 

# Shipboard test results will be

released Oct 2010 Test Date 

# TBD

Engine Make/Model 

# TBD Rated Power (MW) 

# TBD

Fuel Grade (RMG35, RME25, DMB, DMA) 

# TBD Trial Load (MW) 

# TBD

Fuel Sulfur SO2 CO2 CO2 PM 2.5 PM HC NOx CO Back

Press

(%) (ppm) (%) (g/kWhr) (kPa)

Scrubber OFF 

# TBD TBD TBD TBD TBD TBD TBD TBD TBD

Scrubber ON 

# TBD TBD TBD TBD TBD TBD TBD TBD TBD

Reduction (%) 

# TBD TBD TBD TBD TBD TBD TBD TBD TBD

Waste Streams

Wash Water Overboard Discharge 

# Open Loop System 50 Tons/MW-hr, for Closed Loop 0.1 Tons/MW-hr

Must discharge in port? 

# No, in closed loop zero discharge

Meets IMO Wash Water Standards? 

# Yes

Meets EPA Vessel General Permit? 

# Yes

Meets California Ocean Plan

Standards? 

# TBD

Sludge Residue Quantity 

# <0.5Kg/MW-hr

Hazardous waste as per EPA? 

# DNA

Disposal method? 

# Can be treated as normal sludge.

Solid Waste Quantity 

# DNA

Hazardous waste as per EPA? 

# DNA

Disposal method? 

# DNA

# Exhaust Gas Cleaning System s, Selection Guide A-4 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 3 of 5 pages, Aalborg Industries Exhaust Gas Cleaning B.V.



# System Details

Unit Size (MW of Engine Served) 

# 4 MW

Electrical Load (In Port/In ECA/At Sea) (kW) 

# In Port 20kW, Open Sea 40kW

Chemical Usage (In Port/In ECA/At Sea) 

# NaOH (caustic soda), 50% concentration, 27.5Kg/MW-hr

(3.5%HFO)

Exhaust Handling: Pressure drop at full load (kPa) 

# 0.5-1Kpa/50-100 mmwc

Does unit serve as silencer/spark arrestor? 

# Yes

System failure block free flow of exhaust? 

# No

Multiple engine inlet capable? 

# Yes

Seawater Supply Quantity (m 3 

# /hr) 

# 270m 3 

# /h

Fresh Water Consumption (m 3 

# /hr) 

# T=20C, 370 l/h

Steam Supply (kg/hr, kPa) 

# DNA

Air Supply (kg/hr, kPa) 

# DNA

Other necessary utilities? 

# DNA

Component #1 Name 

# EGC 36

Weight in kilograms (Dry/Wet) 

# Dry 11T/Wet 13T

Size in meters (W idth/Depth/Height) 

# Diameter = 2.0m/W=3.5m/H=5.6m

Access required in meters (Front/Side/Top) 

# TBD

Unit Size (MW of Engine Served) 

# 8 MW

Electrical Load (In Port/In ECA/At Sea) (kW) 

# In Port 40kW, Open Sea 80kW

Chemical Usage (In Port/In ECA/At Sea) 

# NaOH (caustic soda), 50% concentration, 27.5Kg/MW-hr

(3.5%HFO)

Exhaust Handling: Pressure drop at full load (kPa) 

# 0.5-1Kpa/50-100 mmwc

Does unit serve as silencer/spark arrestor? 

# Yes

System failure block free flow of exhaust? 

# No

Multiple engine inlet capable? 

# Yes

Seawater Supply Quantity (m 3 

# /hr) 

# 540m 3 

# /h

Fresh Water Consumption (m 3 

# /hr) 

# T=20C, 740 l/h

Steam Supply (kg/hr, kPa) 

# DNA

Air Supply (kg/hr, kPa) 

# DNA

Other necessary utilities? 

# DNA

Component #1 Name 

# EGC 73

Weight in kilograms (Dry/Wet) 

# Dry 15T/Wet 18T

Size in meters (W idth/Depth/Height) 

# Diameter = 2.9m/W=4.9m/H=7.0m

Access required in meters (Front/Side/Top) 

# TBD

# Exhaust Gas Cleaning System s, Selection Guide A-5 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 4 of 5 pages, Aalborg Industries Exhaust Gas Cleaning B.V.

Unit Size (MW of Engine Served) 

# 16 MW

Electrical Load (In Port/In ECA/At Sea) (kW) 

# In Port 80kW, Open Sea 160kW

Chemical Usage (In Port/In ECA/At Sea) 

# NaOH (caustic soda), 50% concentration, 27.5Kg/MW-hr

(3.5%HFO)

Exhaust Handling: Pressure drop at full load (kPa) 

# 0.5-1 Kpa / 50-100 mmwc

Does unit serve as silencer/spark arrestor? 

# Yes

System failure block free flow of exhaust? 

# No

Multiple engine inlet capable? 

# Yes

Seawater Supply Quantity (m 3 

# /hr) 

# 1080 m 3 

# /h

Fresh Water Consumption (m 3 

# /hr) 

# T=20C, 1480 l/h

Steam Supply (kg/hr, kPa) 

# DNA

Air Supply (kg/hr, kPa) 

# DNA

Other necessary utilities? 

# DNA

Component #1 Name 

# EGC 146

Weight in kilograms (Dry/Wet) 

# Dry 23T/Wet 29T

Size in meters (W idth/Depth/Height) 

# Diameter = 4m/W=6.7m/H=9m

Access required in meters (Front/Side/Top) 

# TBD

Unit Size (MW of Engine Served) 

# 32 MW

Electrical Load (In Port/In ECA/At Sea) (kW) 

# In Port 160kW, Open Sea 320kW

Chemical Usage (In Port/In ECA/At Sea) 

# NaOH (caustic soda), 50% concentration, 27.5Kg/MW-hr

(3.5%HFO)

Exhaust Handling: Pressure drop at full load (kPa) 

# 0.5-1 Kpa / 50-100 mmwc

Does unit serve as silencer/spark arrestor? 

# Yes

System failure block free flow of exhaust? 

# No

Multiple engine inlet capable? 

# Yes

Seawater Supply Quantity (m 3 

# /hr) 

# 2160 m 3 

# /h

Fresh Water Consumption (m 3 

# /hr) 

# T=20C, 2960 l/h

Steam Supply (kg/hr, kPa) 

# DNA

Air Supply (kg/hr, kPa) 

# DNA

Other necessary utilities? 

# DNA

Component #1 Name 

# EGC 292

Weight in kilograms (Dry/Wet) 

# Dry 38T/Wet 52T

Size in meters (W idth/Depth/Height) 

# Diameter = 5.9m/W=10.6m/H=11.6m

Access required in meters (Front/Side/Top) 

# TBD

# Exhaust Gas Cleaning System s, Selection Guide A-6 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 5 of 5 pages, Aalborg Industries Exhaust Gas Cleaning B.V.



# System Description (Provided by Supplier)

Aalborg Industries has more than 30 years of experience of supplying scrubbers as an integrated part of Inert Gas Systems (IGS)

onboard ships. During 2008, our experiences from these systems in combination with our experiences from supplying exhaust gas

boilers after large marine diesel engines were used to design a scrubber test rig to cool and clean the exhaust from a test eng ine at

MAN Diesel test facility in Denmark. The knowledge and experience from these tests were successively used to design an entire

exhaust gas cleaning system (EGS) onboard DFDS’ Ro-Ro vessel “Tor Ficaria.” Installed after the 21 MW MAN engine, it is by far

the world’s largest exhaust gas cleaning system installed onboard a ship. The design work has been carried out in close co-ope ration

with the marine engineers from DFDS and MAN Diesel.

The EGC system is a combined wet scrubbi ng system being able to operate in sea water (open loop) and fresh water (closed loop).

At open sea, the system operates with sea water and saves the use of NaOH and fresh water. In harbours and estuaries with stri ct

discharge criteria, the system can operate on fresh water in a cl osed loop system. The combined EGC system offers therefore

maximum flexibility combined with the lowest operational costs. In addition, our Exhaust Gas Scrubber is:

• A cost-saving solution (able to operate on HFO instead of expensive low sulphur MDO/MGO)

• In compliance with MARPOL Annex VI – MEPC 58 and 59

• Provides a sulphur removal rate >98% (exceeding the IMO requirements)

• Traps up to 80% of Particulate Matter (PM)

# Exhaust Gas Cleaning System s, Selection Guide A-7 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 

# BELCO Technologies, 1 of 3 pages

Plus 1 Attachment: BELCO Installation List

Contact 

# Garrett Billemeyer, (973) 515-8902, billemeyer@belcotech.com

Website: http://belcotech.dupont.com

Technology Type(s) 

# EDV, Open Loop and Closed

Loop

No Dry Chemical Other Products 

# Wet Electrostatic Precipitators, Dry

Electrostatic Precipitators, Semi-dry

Scrubbers, TSS and FSS, SCR

Syssterms, LoTOx Systems,

LABSORB Regenerative SO 2 

# Scrubbing Systems.

Exhaust Monitoring

IMO Scheme 

# TBD Vessel Install Contact 

# TBD

System Availability 

# 2 MW to 200 MW Size, Land Based

Install 

# TBD

Development Phase 

# Commercial Size, Shipboard Install 

# TBD

Failure Modes 

# The Scrubber is designed to run

dry and continuously for plus

five years. Interrupted

operations are not an issue. Failure Recovery 

# NA

Unit

Size*

(MW) Commercially

Available

(Yes/No) Land-based

Trial

(Year/Units) Shipboard

Trial

(Year/Units) Efficiency

Results

Available

(Yes/No) How Many Hours of

Operation? Notes



# List of land-based industrial a pplications available upon request.

* Unit size refers to diesel engine size served. Boiler units are not considered in this survey.



# System Efficiency Trial Results

Land-Based or Shipboard Trial 

# Shipboard Test Date 

# TBD

Engine Make/Model 

# 11,349 kW Engine Rated Power (MW) 

# TBD

Fuel Grade (RMG35, RME25, DMB, DMA) 

# 3% Sulfur Diesel Trial Load (MW) 

# 514 RPM

Fuel Sulfur SO2 CO2 CO2 PM 2.5 PM HC NOx CO Back

Press

(%) (ppm) (%) (g/kWhr) (kPa)

Scrubber OFF 

# TBD TBD TBD TBD TBD TBD TBD TBD 0.6

Scrubber ON 

# TBD TBD TBD TBD TBD TBD TBD TBD 0

Reduction (%) 

# > 97% TBD TBD TBD TBD TBD TBD TBD TBD

\

# Exhaust Gas Cleaning System s, Selection Guide A-8 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 2 of 3 pages, Belco Technologies



# Waste Streams

Wash Water Overboard Discharge 

# Dependant on Inlet SOx/Fuel

Must discharge in port? 

# No overboard discharge

Meets IMO Wash Water Standards? 

# Yes

Meets EPA Vessel General Permit? 

# Yes

Meets California Ocean Plan

Standards? 

# Yes

Sludge Residue Quantity 

# Dependant on engine operation and fuel usage

Hazardous waste as per EPA? 

# Dependant on fuel source – no solid waste generated

Disposal method? 

# Occasionally offloaded to waste hauler

Solid Waste Quantity 

# 0

Hazardous waste as per EPA? 

# We comply with all IMO regulations on waste streams

Disposal method? 

# None generated

System Details



# All system details are based on specific design conditions.

Unit Size (MW of Engine Served) 

# TBD

Electrical Load (In Port/In ECA/At Sea) (kW) 

# TBD

Chemical Usage (In Port/In ECA/At Sea) 

# TBD

Exhaust Handling: Pressure drop at full load (kPa) 

# TBD

Does unit serve as silencer/spark arrestor? 

# TBD

System failure block free flow of exhaust? 

# TBD

Multiple engine inlet capable? 

# TBD

Seawater Supply Quantity (m 3 

# /hr) 

# TBD

Fresh Water Consumption (m 3 

# /hr) 

# TBD

Steam Supply (kg/hr, kPa) 

# TBD

Air Supply (kg/hr, kPa) 

# TBD

Other necessary utilities? 

# TBD

Component #1 Name 

# TBD

Weight in kilograms (Dry/Wet) 

# TBD

Size in meters (W idth/Depth/Height) 

# TBD

Access required in meters (Front/Side/Top) 

# TBD

# Exhaust Gas Cleaning System s, Selection Guide A-9 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 3 of 3 pages, Belco Technologies



# System Description (Provided by Supplier)

The Benefits of BELCO® Marine Scrubbing Systems include:

• Reliable and cost effective design — designed specifically for your vessels in conjunction with your engineering staff

• Open tower design. Able to operate uninterrupted for many years concurrent with required dry dockings. No concern with pluggi ng

or maintenance shutdowns while at sea

• No hot by-pass required

• High efficiency of pollutant removal

• Helps meet all IMO, SECA, EPA regulations, even when using high sulfur fuels • Designed to withstand upset conditions and

temperature excursions

• Designed to operate without shutdowns for periods in excess of 5 years

• Able to use various reagents and regenerative buffers

• Low pressure drop design

• High reliability and durability

• High efficiency

Aftermarket Services and Spare Parts include:

• Proprietary components

• Replacement parts

• Start-up support

• Troubleshooting

• Construction advisors

# Exhaust Gas Cleaning System s, Selection Guide A-10 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 

# Couple Systems GmbH, 1 of 3 pages

Contact 

# Ralf Jürgens, +49 40 526000921, rj@couple-systems.com

Website: www.couple-systems.com

Technology Type(s) 

# DryEGCS Other Products 

# DryEGCS can easily be combined

with SCR technology offered by

Couple Systems. It does not require

any additional reheating. Also, PM

app. 80 %, HC app. 60 %

Exhaust Monitoring

IMO Scheme 

# B Vessel Install Contact 

# Shipowner Braren

www.reedereibraren.de

System Availability 

# 1MW up to 60MW Size, Land Based

Install 

# 3MW up to 100MW

Development Phase 

# Commercial Size, Shipboard Install 

# 3.6MW

Failure Modes 

# Close exhaust gas dampers Failure Recovery 

# Close exhaust gas dampers

Unit

Size*

(MW) Commercially

Available

(Yes/No) Land-based

Trial

(Year/Units) Shipboard

Trial

(Year/Units) Efficiency

Results

Available

(Yes/No) How Many Hours of

Operation? Notes



# 3.6 Yes DNA 2009/1 99% 3500 TBD

* Unit size refers to diesel engine size served. Boiler units are not considered in this survey.



# System Efficiency Trial Results

Land-Based or Shipboard Trial 

# Shipboard Test Date 

# 2009/12/1

Engine Make/Model 

# MaK8M32 Rated Power (MW) 

# 3.6

Fuel Grade (RMG35, RME25, DMB, DMA) 

# HFO 0.9%S Trial Load (MW) 

# 1.2

Fuel Sulfur SO2 CO2 CO2 PM 2.5 PM HC NOx CO Back

Press

(%) (ppm) (%) (g/kWhr) (kPa)

Scrubber OFF 

# 258 6.44 TBD TBD TBD 113 1065 98 DNA

Scrubber ON 

# 1 6.31 TBD TBD TBD 45 1054 153 0.8 across

Scrubber

Reduction (%) 

# 99% DNA TBD TBD TBD 60 DNA DNA TBD

\

# Exhaust Gas Cleaning System s, Selection Guide A-11 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 2 of 3 pages, Couple Systems GmbH



# Waste Streams

Wash Water Overboard Discharge 

# DNA

Must discharge in port? 

# DNA

Meets IMO Wash Water Standards? 

# DNA

Meets EPA Vessel General Permit? 

# DNA

Meets California Ocean Plan

Standards? 

# DNA

Sludge Residue Quantity 

# DNA

Hazardous waste as per EPA? 

# DNA

Disposal method? 

# DNA

Solid Waste Quantity 

# DNA

Hazardous waste as per EPA? 

# DNA

Disposal method? 

# DNA

System Details

Unit Size (MW of Engine Served) 

# 4MW

Electrical Load (In Port/In ECA/At Sea) (kW) 

# 12/12/12

Chemical Usage (In Port/In ECA/At Sea) 

# Calcium Hydroxide, 99%, .05 Tons/MW-hr,

50 Kg/h, 50 Kg/h, 0

Exhaust Handling: Pressure drop at full load (kPa) 

# 1

Does unit serve as silencer/spark arrestor? 

# Yes

System failure block free flow of exhaust? 

# No

Multiple engine inlet capable? 

# Yes

Seawater Supply Quantity (m 3 

# /hr) 

# DNA

Fresh Water Consumption (m 3 

# /hr) 

# DNA

Steam Supply (kg/hr, kPa) 

# DNA

Air Supply (kg/hr, kPa) 

# DNA

Other necessary utilities? 

# DNA

Component #1 Name 

# DryEGCS Absorber

Weight in kilograms (Dry/Wet) 

# 57,000

Size in meters (W idth/Depth/Height) 

# 3.85/5.60/7.80

Access required in meters (Front/Side/Top) 

# 0.6/0.6/0.5

Component #2 Name 

# Supply and Discharge System

Weight in kilograms (Dry/Wet) 

# 24,000

Size in meters (W idth/Depth/Height) 

# 2.40/2.40/6.0

Access required in meters (Front/Side/Top) 

# 0.6/0.6/0.5

# Exhaust Gas Cleaning System s, Selection Guide A-12 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 3 of 3 pages, Couple Systems GmbH



# System Description (Provided by Supplier)

Couple Systems GmbH, Bardowick, Germany, brought the worldwide first and only dry system for the desulphurisation of exhaust

gases of commercial vessels successfully into service on MS Timbus . Motorenwerke Bremerhaven (MWB AG) was able to install the

system in less than a week’s time with high precision and impeccable workmanship on the cellulose freighter MS Timbus (MaK

8M32, 3.6 MW) of the shipowning compan y Reederei Braren, Kollmar, Germany. Germanischer Lloyd (GL) has now taken

outstanding test readings on the system. This clearly proves the feasibility of the DryEGCS ® on board ships and the full comp liance

of the system with the requirements with of Marpol Annex VI. Couple Systems GmbH provides a technical solution, proven and

readily available to shipping. A continuation of the HFO-era is ecologically possible. A Return-on-Invest when purchasing a

DryEGCS® in the light of today’s fuel prices, for ships that ma inly navigate in the ECA North- and Baltic-Sea, is possible in o ne year.

The 240° to 350°C hot exhaust gas, which contains SO2 and SO3, is fed through a packed-bed absorber filled with lime (calcium

hydroxide Ca(OH)2) in the form of granulate pellets. The reactio n product is CaSO4 i.e. gypsum. The spherical form of the gra nulate

is retained. The ship’s ballast chambers, cargo space, and othe r open, storage areas on the ship provide storage for recyclabl es.

DryEGCS® is dimensioned conservatively so that the collection e fficiency is reliably achieved. The loading limit for the calci um

hydroxide granulate is about 60%. Thus the absorbent material retains a considerable residual activity for desulphurisation.

Alternatively, the residues can be used as mine filling. In th is case, costs of approximately US-$ 100 per metric ton can be e xpected.

# Exhaust Gas Cleaning System s, Selection Guide A-13 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 

# Ecospec, 1 of 4 pages

Contact 

# Tany Tay, +65 6602 9600, tany@ecospec.com

Website: www.ecospec.com

Technology Type(s) 

# CSNOx, an Ultra-Low

Frequency Electrolysis System Other Products 

# TBD

Exhaust Monitoring

IMO Scheme 

# TBD Vessel Install Contact 

# TBD

System Availability 

# TBD Size, Land Based

Install 

# TBD

Development Phase 

# TBD Size, Shipboard Install 

# 11MW

Failure Modes 

# TBD Failure Recovery 

# TBD

Unit

Size*

(MW) Commercially

Available

(Yes/No) Land-based

Trial

(Year/Units) Shipboard

Trial

(Year/Units) Efficiency

Results

Available

(Yes/No) How Many Hours of

Operation? Notes



# TBD TBD 2009/1 DNA Yes TBD

5MW TBD DNA 2010 Yes TBD

* Unit size refers to diesel engine size served. Boiler units are not considered in this survey.



# System Efficiency Trial Results

Land-Based or Shipboard Trial 

# Shore-Based Test Rig Test Date 

# 2009

Engine Make/Model 

# TBD Rated Power (MW) 

# TBD

Fuel Grade (RMG35, RME25, DMB, DMA) 

# TBD Trial Load (MW) 

# TBD

Fuel Sulfur SO2 CO2 CO2 PM 2.5 PM HC NOx CO Back

Press

(%) (ppm) (%) (g/kWhr) (kPa)

Scrubber OFF 

# TBD TBD TBD TBD TBD TBD TBD TBD TBD

Scrubber ON 

# TBD TBD TBD TBD TBD TBD TBD TBD TBD

Reduction (%) 

# 99% 30-55% TBD TBD TBD TBD 50-80% TBD TBD

\

# Exhaust Gas Cleaning System s, Selection Guide A-14 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 2 of 4 pages, Ecospec

Land-Based or Shipboard Trial 

# Shipboard, Aframax Tanker Test Date 

# 2010

Engine Make/Model 

# Main Engine, 100,000-Tonne Oil

Tanker Rated Power (MW) 

# 11MW

Fuel Grade (RMG35, RME25, DMB, DMA) 

# 380 cSt, 3.64% Sulfur Trial Load (MW) 

# 5MW

Fuel Sulfur SO2 CO2 CO2 PM 2.5 PM HC NOx CO Back

Press

(%) (ppm) (%) (g/kWhr) (kPa)

Scrubber OFF 

# TBD TBD TBD TBD TBD TBD TBD TBD TBD

Scrubber ON 

# TBD TBD TBD TBD TBD TBD TBD TBD TBD

Reduction (%) 

# 98.6-

98.9% 76.5-

77.1% TBD TBD TBD TBD 64.5-

66.2% TBD TBD

Waste Streams

Wash Water Overboard Discharge 

# Yes

Must discharge in port? 

# TBD

Meets IMO Wash Water Standards? 

# Yes

Meets EPA Vessel General Permit? 

# Yes

Meets California Ocean Plan

Standards? 

# Yes

Sludge Residue Quantity 

# pH 6.7, PAH <1 ppb, Nitrates <0.066mg/l (ppm), Turbidity Δ 8.7 NTU

Hazardous waste as per EPA? 

# TBD

Disposal method? 

# TBD

Solid Waste Quantity 

# TBD

Hazardous waste as per EPA? 

# TBD

Disposal method? 

# TBD

# Exhaust Gas Cleaning System s, Selection Guide A-15 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 3 of 4 pages, Ecospec



# System Details

Unit Size (MW of Engine Served) 

# 5MW

Electrical Load (In Port/In ECA/At Sea) (kW) 

# TBD

Chemical Usage (In Port/In ECA/At Sea) 

# None

Exhaust Handling: Pressure drop at full load (kPa) 

# TBD

Does unit serve as silencer/spark arrestor? 

# TBD

System failure block free flow of exhaust? 

# TBD

Multiple engine inlet capable? 

# TBD

Seawater Supply Quantity (m 3 

# /hr) 

# TBD

Fresh Water Consumption (m 3 

# /hr) 

# TBD

Steam Supply (kg/hr, kPa) 

# TBD

Air Supply (kg/hr, kPa) 

# TBD

Other necessary utilities? 

# TBD

Component #1 Name 

# TBD

Weight in kilograms (Dry/Wet) 

# TBD

Size in meters (W idth/Depth/Height) 

# TBD

Access required in meters (Front/Side/Top) 

# TBD

# Exhaust Gas Cleaning System s, Selection Guide A-16 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 4 of 4 pages, Ecospec



# System Description (Provided by Supplier)

ABS, one of the world’s leading classificatio n societies, has issued a statement on 8 February 2010 verifying the results of su lphur

dioxide (SO2), carbon dioxide (CO2), nitrogen oxide (NOx) removal from the emissions of a trading 100,000-tonne Aframax tanker

installed with the CSNOx gas abatement system. In the first lo ad point verifications, part of the ongoing IMO Type Approval

certification process, conducted during the last week of January 2010 onboard this 100,000-tonne oil tanker, at 50% gas load

(equivalent to approximately 5 MW engine output), ABS issued a Statement of Fact on the performance of CSNOx system with the

following results:

Fuel: Type Temperature Sulfur Content

380 cSt 50°C 3.64%

Removal SO2 CO2 NOx: efficiencies: 98.6% - 98.9% 76.5% - 77.1% 64.5% - 66.2%

Exhaust gas: Inlet Outlet: 212.3°C 33.5°C

Wash water pH PAH Nitrates T emperature Turbidity Quality: 6.7 <1 ppb <0.066mg/l (ppm) 32°C Δ 8.7 NTU

This 100,000-tonne Singapore-registered oil tanker, which is owned and managed by leading shipping company Tanker Pacific, set

sail from Singapore, travelling to the Middle East via Sri Lanka. Significantly, the removal efficiencies of the CSNOx system allows

vessels installed with CSNOx to continue using normal heavy fuel and yet meet the 0.1% sulfur content as required by the EU

Directive effective from 1 Januar y 2010. The removal efficiency for NOx is the absolute reduction percentage. After translatin g this

removal efficiency into the NOx emission requirement as per the Ti er 1, 2 or 3 requirements, the CSNOx system is able to remove

NOx to such levels that vessels installed with it are able to m eet even the strictest Tier 3 requ irement. CSNOx truly is a cos t-effective

and efficient solution for solving the emission issues faced by th e ship owners. In addition, the results also affirm CSNOx sc alability

and suitability for a normal ship’s operations.

# Exhaust Gas Cleaning System s, Selection Guide A-17 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 

# Hamworthy Krystallon Ltd /Hamworthy Moss, 1 of 4 pages

Contact 

# Heidi Marie Johannessen, +47 6927 9900, hkjohannessen@hamworthy.com



# Website: http://www.hamworthy.com/en/Products-Systems/HamworthyMarine/Emissions-Reduction/Exhaust-Gas-Cleaning/

Technology Type(s) 

# Open Loop (Closed Loop under

Development)

No Dry Chemical

Hybrid Wet Solution Available Other Products 

# The Hamworthy Krystallon SOx

scrubber also acts as a Particulates

scrubber. Stand alone PM scrubbers

also available

Exhaust Monitoring

IMO Scheme 

# Scheme B Vessel Install Contact 

# TBD

System Availability 

# 0.5 MW to 60 MW Size, Land Based

Install 

# 0.4MW, 1MW, 2.2MW

Development Phase 

# Commercial Size, Shipboard Install 

# 1MW, 6MW, 8.5MW,

Failure Modes 

# Power loss, multiple supply

pump failure, leakage (return

pipes or scrubber), clogging of

the wet filter. Failure Recovery 

# If the issue is with the supply or

return pump, then the system can be

restarted as soon as the pump is

repaired.

Unit

Size*

(MW) Commercially

Available

(Yes/No) Land-based

Trial

(Year/Units) Shipboard

Trial

(Year/Units) Efficiency

Results

Available

(Yes/No) How Many Hours of

Operation? Notes



# 0.5 Yes 2005/1 Yes 500 Test Unit

1 Yes 2008/1 2005/1 Yes 30,000

2 Yes 2008/1 No 0 Power Plant installation

not yet finished

6 No 1993/1 Yes 8000 Initial Hamworthy

design

8 Yes 2007/1 Yes 4000

* Unit size refers to diesel engine size served. Boiler units are not considered in this survey.



# System Efficiency Trial Results

Land-Based or Shipboard Trial 

# Land Based Test Date 

# 2009

Engine Make/Model 

# DM “MTE40” Rated Power (MW) 

# 0.9MW

Fuel Grade (RMG35, RME25, DMB, DMA) 

# TBD Trial Load (MW) 

# Various

Fuel Sulfur SO2 CO2 CO2 PM 2.5 PM HC NOx CO Back

Press

(%) (ppm) (%) (g/kWhr) (kPa)

Scrubber OFF 

# 340 ppm DNA DNA TBD TBD TBD TBD TBD TBD

Scrubber ON 

# 4 ppm TBD TBD TBD TBD TBD TBD TBD TBD

Reduction (%) 

# 99% TBD TBD DNA 60% DNA DNA DNA 25

\

# Exhaust Gas Cleaning System s, Selection Guide A-18 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 2 of 4 pages, Hamworthy Krystallon Ltd /Hamworthy Moss

Land-Based or Shipboard Trial 

# Shipboard Test Date 

# 2009

Engine Make/Model 

# Sulzer 6ATL25H Rated Power (MW) 

# 0.8MW

Fuel Grade (RMG35, RME25, DMB, DMA) 

# IF380 Trial Load (MW) 

# TBD

Fuel Sulfur SO2 CO2 CO2 PM 2.5 PM HC NOx CO Back

Press

(%) (ppm) (%) (g/kWhr) (kPa)

Scrubber OFF 

# 330 ppm DNA DNA TBD TBD TBD TBD TBD TBD

Scrubber ON 

# 12 ppm TBD TBD TBD TBD TBD TBD TBD TBD

Reduction (%) 

# 96.5% TBD TBD DNA 60% DNA DNA DNA 25

Land-Based or Shipboard Trial 

# Shipboard Test Date 

# 2010

Engine Make/Model 

# Sulzer 12VZA40S Rated Power (MW) 

# 0.8MW

Fuel Grade (RMG35, RME25, DMB, DMA) 

# IF380 Trial Load (MW) 

# 7.4

Fuel Sulfur SO2 CO2 CO2 PM 2.5 PM HC NOx CO Back

Press

(%) (ppm) (%) (g/kWhr) (kPa)

Scrubber OFF 

# 340ppm DNA DNA TBD TBD TBD TBD TBD TBD

Scrubber ON 

# 4ppm TBD TBD TBD TBD TBD TBD TBD TBD

Reduction (%) 

# 99% TBD TBD DNA 60% DNA DNA DNA 25

Waste Streams

Wash Water Overboard Discharge 

# 45 Tons/MW-hr

Must discharge in port? 

# Yes

Meets IMO Wash Water Standards? 

# Yes

Meets EPA Vessel General Permit? 

# Yes

Meets California Ocean Plan

Standards? 

# Meets MARPOL Annex VI

Sludge Residue Quantity 

# <0.1kg/MW.hr

Hazardous waste as per EPA? 

# No

Disposal method? 

# 1) With ships waste oil, and 2) In portable containers

Solid Waste Quantity 

# 0

Hazardous waste as per EPA? 

# DNA

Disposal method? 

# DNA

# Exhaust Gas Cleaning System s, Selection Guide A-19 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 3 of 4 pages, Hamworthy Krystallon Ltd /Hamworthy Moss



# System Details

Unit Size (MW of Engine Served) 

# 8 MW

Electrical Load (In Port/In ECA/At Sea) (kW) 

# 75/120/120

Chemical Usage (In Port/In ECA/At Sea) 

# 0

Exhaust Handling: Pressure drop at full load (kPa) 

# 20 kPa

Does unit serve as silencer/spark arrestor? 

# Yes

System failure block free flow of exhaust? 

# Yes

Multiple engine inlet capable? 

# Yes

Seawater Supply Quantity (m 3 

# /hr) 

# 360 m 3 

# /hr @ 600kPa

Fresh Water Consumption (m 3 

# /hr) 

# 0

Steam Supply (kg/hr, kPa) 

# 450 kg/hr(deplume)@100kPa

Air Supply (kg/hr, kPa) 

# For instruments only

Other necessary utilities? 

# DNA

Component #1 Name 

# 2MW

Weight in kilograms (Dry/Wet) 

# 3500/4750 kg

Size in meters (W idth/Depth/Height) 

# 1.4/1.4/5

Access required in meters (Front/Side/Top) 

# 600 mm

Exhaust Handling: Pressure drop at full load (kPa) 

# 8 MW

Does unit serve as silencer/spark arrestor? 

# Yes

System failure block free flow of exhaust? 

# No

Multiple engine inlet capable? 

# Yes

# Exhaust Gas Cleaning System s, Selection Guide A-20 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 4 of 4 pages, Hamworthy Krystallon Ltd /Hamworthy Moss



# System Description (Provided by Supplier)

The Hamworthy Krystallon sea water scrubbing technology will rem ove more than 98% of sulphur along with the majority of

particulate matter from a 3.5% sulphur re sidual fuel. The technology is suitable for both new build and retrofit applications, and will

deliver ease of operation and low maintenance costs. The technology is available for a wide range of vessel and engine

configurations. Hamworthy Krystallon can offer;



# 1. Pre-installation design suppor t and shipyard supervision



# 2. A full post-installation commissioning service



# 3. After sales and service support through Hamworthy’s extensive service network worldwide



# 4. Access to innovative project financing and fuels supply risk management

The Sea Water Scrubber unit is manufactured from high nickel chro me alloy steels ensuring long lifetime and reliable operation. It

can fit into the funnel space being both lightweight and self supporting. Whilst the Scrubber is designed to run cool, operati ng on a

constant supply of sea water, under emergency conditions it can be operated at temperatures of up to 450°C. It also provides f or

silencing of the engine exhaust noise, an d may therefore replace a typical exhaust gas silencer. The main sea water intake pip e work

is manufactured from glass reinforced epoxy. This provides high corrosion resistance, low flow losses, light weight, and ease of

installation. Water is transferre d around the system via Hamworthy’s own trusted centrifugal pumps.

The wash water treatment system will handle the full Scrubber Unit water flow. It is designed to remove both solid particulate matter

and liquid hydrocarbon waste products. All exposed materials and wash water transfer pipe work are also manufactured from

corrosion proof glass reinforced epoxy. The high efficiency design complies with the requirements of MARPOL Annex VI

Regulation 14 Sea Water Scrubbing Wash Water Criteria.

Hamworthy has over 25 years experience of sea water scrubbing through its Inert Gas operation in Moss. Our knowledge and detai led

engineering capability allied with Hamworthy Krystallon t echnology is unique in th e marine market place.

# Exhaust Gas Cleaning System s, Selection Guide A-21 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 

# Marine Exhaust Solutions, 1 of 3 pages

Contact 

# Robert Clarke, (506) 214-0535, rclarke@marineexhaustsolutions.com

Website: www.marineexhaustsolutions.com

Technology Type(s) 

# Seawater Scrubbing System Other Products 

# J series for PM reduction on diesel

fuel engines,

NOx reduction unit for MAN Diesel.

Exhaust Monitoring

IMO Scheme 

# TBD Vessel Install Contact 

# TBD

System Availability 

# TBD Size, Land Based

Install 

# DNA

Development Phase 

# TBD Size, Shipboard Install 

# 1.2 to 5.6MW

Failure Modes 

# Water carryover prevented full

time running during tests. Failure Recovery 

# Run in dry mode until fixed.

Unit

Size*

(MW) Commercially

Available

(Yes/No) Land-based

Trial

(Year/Units) Shipboard

Trial

(Year/Units) Efficiency

Results

Available

(Yes/No) How Many Hours of

Operation? Notes



# 22.7 No DNA 2003/8 Yes 11,680

15.0 TBD DNA 2001 Yes TBD Trials spanned 6 mos.

* Unit size refers to diesel engine size served. Boiler units are not considered in this survey.



# System Efficiency Trial Results

Land-Based or Shipboard Trial 

# Shipboard, RORO ferry Test Date 

# March 2003

Engine Make/Model 

# Two engine packages, type TBD Rated Power (MW) 

# Four 5.6MW

mains and four

1.2MW

auxiliary

engines

Fuel Grade (RMG35, RME25, DMB, DMA) 

# Heavy Fuel 2.4% Sulfur Trial Load (MW) 

# 22.7

Fuel Sulfur SO2 CO2 CO2 PM 2.5 PM HC NOx CO Back

Press

(%) (ppm) (%) (g/kWhr) (kPa)

Scrubber OFF 

# 235T/yr TBD TBD TBD TBD TBD TBD TBD TBD

Scrubber ON 

# 59T/yr TBD TBD TBD TBD TBD TBD TBD In Limits

Reduction (%) 

# 74-80% TBD TBD TBD TBD TBD TBD TBD TBD

Land-Based or Shipboard Trial 

# Shipboard, Ferry Test Date 

# 2001

Engine Make/Model 

# TBD Rated Power (MW) 

# 1.5MW

Fuel Grade (RMG35, RME25, DMB, DMA) 

# Heavy Fuel 2.4% Sulfur Trial Load (MW) 

# TBD

Fuel Sulfur SO2 CO2 CO2 PM 2.5 PM HC NOx CO Back

Press

(%) (ppm) (%) (g/kWhr) (kPa)

Scrubber OFF 

# TBD TBD TBD TBD TBD TBD TBD TBD TBD

Scrubber ON 

# TBD TBD TBD TBD TBD TBD TBD TBD TBD

Reduction (%) 

# 90% TBD TBD TBD TBD TBD TBD TBD TBD

# Exhaust Gas Cleaning System s, Selection Guide A-22 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 2 of 3 pages, Marine Exhaust Solutions



# Waste Streams

Wash Water Overboard Discharge 

# Yes

Must discharge in port? 

# No

Meets IMO Wash Water Standards? 

# Yes

Meets EPA Vessel General Permit? 

# Yes

Meets California Ocean Plan

Standards? 

# TBD

Sludge Residue Quantity 

# 0.6T/week

Hazardous waste as per EPA? 

# TBD

Disposal method? 

# Onshore

Solid Waste Quantity 

# 0.6T/week

Hazardous waste as per EPA? 

# TBD

Disposal method? 

# Onshore

System Details

Unit Size (MW of Engine Served) 

# TBD

Electrical Load (In Port/In ECA/At Sea) (kW) 

# TBD

Chemical Usage (In Port/In ECA/At Sea) 

# TBD

Exhaust Handling: Pressure drop at full load (kPa) 

# TBD

Does unit serve as silencer/spark arrestor? 

# TBD

System failure block free flow of exhaust? 

# TBD

Multiple engine inlet capable? 

# TBD

Seawater Supply Quantity (m 3 

# /hr) 

# TBD

Fresh Water Consumption (m 3 

# /hr) 

# TBD

Steam Supply (kg/hr, kPa) 

# TBD

Air Supply (kg/hr, kPa) 

# TBD

Other necessary utilities? 

# TBD

Component #1 Name 

# TBD

Weight in kilograms (Dry/Wet) 

# TBD

Size in meters (W idth/Depth/Height) 

# TBD

Access required in meters (Front/Side/Top) 

# TBD

# Exhaust Gas Cleaning System s, Selection Guide A-23 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 3 of 3 pages, Marine Exhaust Solutions



# System Description (Provided by Supplier)

Throughout the 16-month trials onboard the RORO passenger ferry , the auxiliary engines were operational for approximately 11680

hours and consumed 6272 tonnes of fuel. During this time, based on a reduction rate of 75%, the EcoSilencer® removed 235.5 of the

314 Tonnes of SO2. In particular:

• A sustainable SO2 removal level of 74% – 80% was obtained with a maximum/minimum range of 94% to 68%.

• The target removal of 90% was only achievable by overcharging the existing water circulation system. Proposed

modifications to the circulating water sy stem are expected to result in higher SO2 removal without the necessity of

overcharging.

• Tests showed the overboard water discharg e complies with USA EPA test criteria.

• Engine performance was not compromised. System backpressures remained w ithin the engines’ accepted limits.

• No indication of an increase in engine fuel consumption was noted.

• Soot sludge removal amounted to approximately 0.6 T/week and was easily handled as part of the ships regular onshore

waste disposal.

• Minimal system maintenance was required. Routine maintenanc e consisted of, periodical boroscope type inspections, water

circulation pump maintenance and periodical cleaning of the level measuring probes.

• Further trials are needed to confirm the design modifications that will achieve the targeted 90% SO2 removal rates for the

main engines. The challenge of scaling the system design from a single unit at 1500 kW to eight units at 22700 kW as well

as manufacturing, shipping and installation within the four months available proved to be greater than anticipated. A lack of

time to properly model the design for the main engine units resulted in installing a system that required additional

modifications to become operational.

The final result demonstrates that the EcoSilencer® is a reliabl e, low maintenance sea water scrubbing system that achieves red uctions

in SO2 emissions that far exceed those mandated by MARPOL Annex VI.

# Exhaust Gas Cleaning System s, Selection Guide A-24 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 

# Wärtsilä Finland Oy, 1 of 4 pages

Contact

Technology Type(s) 

# Closed Loop, High Sulfur SCR Other Products 

# Wärsilä NOx Reducer

Exhaust Monitoring

IMO Scheme 

# A and B Vessel Install Contact 

# TBD

System Availability 

# TBD Size, Land Based

Install 

# TBD

Development Phase 

# Commercial Size, Shipboard Install 

# 0.68MW

Failure Modes 

# TBD Failure Recovery 

# TBD

Unit

Size*

(MW) Commercially

Available

(Yes/No) Land-based

Trial

(Year/Units) Shipboard

Trial

(Year/Units) Efficiency

Results

Available

(Yes/No) How Many Hours of

Operation? Notes



# .68MW Yes TBD 2008/2 Yes TBD 

# IMO Certification

* Unit size refers to diesel engine size served. Boiler units are not considered in this survey.



# System Efficiency Trial Results

Land-Based or Shipboard Trial 

# Shipboard Test Date 

# 2008-2010

Engine Make/Model 

# Wärtsilä 4L20 Rated Power (MW) 

# 0.68MW

Fuel Grade (RMG35, RME25, DMB, DMA) 

# HFO 1.5% and 3.4%S Trial Load (MW) 

# 8, 40, 70, and

100% Load

Fuel Sulfur SO2 CO2 CO2 PM 2.5 PM HC NOx CO Back

Press

(%) (ppm) (%) (g/kWhr) (kPa)

Scrubber OFF 

# TBD TBD TBD TBD TBD TBD TBD TBD TBD

Scrubber ON 

# TBD TBD TBD TBD TBD TBD TBD TBD TBD

Reduction (%) 

# >99% TBD TBD TBD TBD TBD TBD TBD TBD

\

# Exhaust Gas Cleaning System s, Selection Guide A-25 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 2 of 4 pages, Wärtsilä Finland Oy

Land-Based or Shipboard Trial Test Date

Engine Make/Model Rated Power (MW) 

# MW

Fuel Grade (RMG35, RME25, DMB, DMA) Trial Load (MW) 

# MW

Fuel Sulfur SO2 CO2 CO2 PM 2.5 PM HC NOx CO Back

Press

(%) (ppm) (%) (g/kWhr) (kPa)

Scrubber OFF 

# TBD TBD TBD TBD TBD TBD TBD TBD TBD

Scrubber ON 

# TBD TBD TBD TBD TBD TBD TBD TBD TBD

Reduction (%) 

# TBD TBD TBD TBD TBD TBD

Waste Streams

Wash Water Overboard Discharge 

# 0.1

Must discharge in port? 

# No

Meets IMO Wash Water Standards? 

# Yes

Meets EPA Vessel General Permit? 

# TBD

Meets California Ocean Plan

Standards? 

# TBD

Sludge Residue Quantity 

# 0.0013 Tons/MW-hr

Hazardous waste as per EPA? 

# No

Disposal method? 

# Same as Engine Room sludge.

Solid Waste Quantity 

# 0

Hazardous waste as per EPA? 

# DNA

Disposal method? 

# DNA

# Exhaust Gas Cleaning System s, Selection Guide A-26 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 3 of 4 pages, Wärtsilä Finland Oy



# System Details

Unit Size (MW of Engine Served) 

# 8MW (main stream scrubber)

Electrical Load (In Port/In ECA/At Sea) (kW) 

# 24 kW

Chemical Usage (In Port/In ECA/At Sea) 

# Case dependent, 50% concentration NaOH

Exhaust Handling: Pressure drop at full load (kPa) 

# 800 kPa

Does unit serve as silencer/spark arrestor? 

# Partly

System failure block free flow of exhaust? 

# No

Multiple engine inlet capable? 

# Yes

Seawater Supply Quantity (m 3 

# /hr) 

# TBD

Fresh Water Consumption (m 3 

# /hr) 

# 0.8 m 3 

# /hr

Steam Supply (kg/hr, kPa) 

# DNA

Air Supply (kg/hr, kPa) 

# TBD

Other necessary utilities? 

# TBD

Component #1 Name 

# Scrubber Unit

Weight in kilograms (Dry/Wet) 

# 6000/8000

Size in meters (W idth/Depth/Height) 

# 2.8/2.8/6

Access required in meters (Front/Side/Top) 

# TBD

# Exhaust Gas Cleaning System s, Selection Guide A-27 Th e Glosten Associates, Inc

Appendix A, Technology Survey, Rev. – File No. 10047.01, 12 January 2011 4 of 4 pages, Wärtsilä Finland Oy



# System Description (Provided by Supplier)

Wärtsilä has developed a feasible scrubber solution, both for new installations and as a retrofit to existing ships. Combustio n units can

be diesel engines of any make, type, or application, 2-stroke or 4-stroke. In the case of Integrated Scrubber, also flue gases of oil-fired

boilers can be cleaned. The SOx removal effi ciency of Wärtsilä scrubber system is over 97%, making possible to operate with 3. 5%

sulphur fuel and still comply with 0.1% sulphur fuel limit. Ther e are different scrubber configur ations available. The scrubb er system

is equipped with an automation system for operation, monitoring, and safety control. Wärtsilä scrubber system has been approve d by

classification societies.

The Wärtsilä fresh water scrubber is based on closed loop system. Within this process, sulphur oxides in the exhaust gas strea m are

captured and neutralized by scrubbing water. The scrubbing wate r is based on fresh water boosted with alkali, typically sodium

hydroxide (NaOH). The chemical process sulphur oxides resulting from the exhaust gas are neutralized to sulphates in the scrub bing

water. The scrubber system is entirely built of highly corrosion resistant materials. Scrubbing water circulation flow rate i s related to

the actual dimensions of the scrubber module and design performa nce of the system. Scrubbing wa ter is buffered in a process ta nk or

wet sump for controlling the quality of the solution. This water is circulated with circulation pump from process tank or wet sump via

the cooling heat exchanger to sc rubber and back. A small bleed-o ff is extracted from the scrubbing water circulation to remove the

accumulated impurities and led to treatment unit. Clean efflue nt from the treatment unit is monitored full-filling IMO quality

requirements and can be discharged overboard. If operation in zero discharge mode is requested, the effluent can be led to a h olding

tank for scheduled and periodical discharge.

# Exhaust Gas Cleaning System s, Selection Guide The Glosten Associates, Inc

Appendix B, Life Cycle Cost Tables, Re v. – File No. 10047.01, 12 January 2011 

# Appendix B Life Cycle Cost Tables

This Appendix provides the tables that were developed to suppor t the life cycle cost analysis performed for the

Ship Operations Cooperative Program (SOCP) marine exhaust gas cleaning system (EGCS) selection guide.

# Containership

Transpacific Containership

Alaska to Puget

Sound Tankship US

West Coast

Ship Speed (knots) 23 20 14.5

Port Name Shanghai Tacoma Anacortes

Distance from Last (n.miles) 5345 1453 1117

non

‐ ECA (n.miles) 4584 726.5 0

ECA (n.miles) 761 726.5 1117

Transit Time

non

‐ ECA (days) 8.30 1.51 0.00

ECA (days) 1.38 1.51 3.21

Port Time (days) 2.00 0.25 0.75

Port Name Los Angeles Anchorage Long Beach

Distance from Last (n.miles) 5643 1453 1117

non

‐ ECA (n.miles) 4882 726.5 0

ECA (n.miles) 761 726.5 1117

Transit Time

non

‐ ECA (days) 8.84 1.51 0.00

ECA (days) 1.38 1.51 3.21

Port Time (days) 1.00 0.42 0.75

Port Name Oakland

Distance from Last (n.miles) 374

non

‐ ECA (n.miles) 0

ECA (n.miles) 374

Transit Time

non

‐ ECA (days) 0.0

ECA (days) 0.7

Port Time (days) 1.0

Trip Total (days) 24.6 6.7 7.9

Transit Time

non

‐ ECA (days) 17.1 3.0 0.0

ECA (days) 3.4 3.0 6.4

Port Time (ECA) (days) 4.0 0.7 1.5

Notes:

1. Containership route and speed based on simplified Horizon Lines Eastern run.

2. Trailership route and speed based on TOTE Alaskan service run.

3. Tankship route based on product trade on West Coast. Speeds are typical.

4. Ocean transits assume Great Circle route.

5. U.S. port to port uses NOAA estimated distances.

6. ECA entry from Ocean assumes a run at 45 degrees to account for maneuvering.

7. ECA from AK to Puget Sound is rough estimate of 50% based on geography.

Exhaust Gas Cleaning Systems

Operators Guide Life Cycle Cost

‐ Ship Transits

Sheet 1 of 77 The Glosten Associates

File 10047.01, 12 January 2011

# Containership

Transpacific Containership

Alaska to Puget

Sound Tankship US

West Coast

Installed Equipment

Propulsion (kW) 1 x 36,000 1 x 16,000 1 x 10,100

(gr/kW

‐ hr) 170 175 175

Auxiliary (kW) 3 x 1,000 4 x 1500 3 x 1,000

(gr/kW

‐ hr) 185 185 185

Annual Ops (days) 320 320 320

Transit (kW) 30,200 14,700 9,000

Non

‐ ECA (hours/yr) 5,357 3,459 0

Fuel (MT/yr) 27,502 8,899 0

ECA (hours/yr) 1,074 3,459 6,225

Fuel (MT/yr) 5,512 8,899 9,805

Ships Service (kW) 1200 800 350

Non

‐ ECA (hours/yr) 5,357 3,459 0

Fuel (MT/yr) 1,189 512 0

ECA (hours/yr) 2,323 4,221 7,680

Fuel (MT/yr) 516 625 497

Cargo Support (kW) 800 800 2000

ECA (hours/yr) 1,250 762 1,455

Fuel (MT/yr) 185 113 538

Fuel Total Fuel (MT/yr) 34,903 19,046 10,840

Non

‐ ECA Fuel (MT/yr) 28,691 9,410 0

ECA Fuel (MT/yr) 6,212 9,636 10,840

Notes:

1. Container Transpacific propulsion power based on 4000 TEU ship, MAN Containerships Trends 2008.

2. Container Alaska propulsion power based on 2000 TEU ship, MAN Containerships Trends 2008.

3. Tankship propulsion power based on 60,000 DWT, MAN Tankship Trends 2008.

4. Cargo and Ship Service loads are rough estimates.

5. Engine fuel consumptions based on 2 stroke diesels for propulsion, and 4 stroke for

generators. Using rough estimates from Wartsila.

Exhaust Gas Cleaning Systems

Operators Guide Life Cycle Cost

‐ Fuel Consumption

Sheet 2 of 77 The Glosten Associates

File 10047.01, 12 January 2011

# Open Loop Closed Loop Hybrid Dry

Scrubber Ratings

(by Engine Size) (USD) (USD) (USD) (USD)

36MW 3,100,000 3,850,000 3,600,000 6,050,000

16MW 2,900,000 3,600,000 3,120,000 3,200,000

12MW 2,000,000 2,500,000 2,220,000 1,900,000

10MW 1,800,000 2,150,000 1,920,000 1,600,000

3MW 1,300,000 1,850,000 1,560,000 1,250,000

1MW 1,000,000 1,750,000 1,260,000 930,000

Containership

Transpacific 5,260,000 6,430,000 5,904,000 7,970,000

Containership Alaska to

Puget Sound 5,060,000 6,180,000 5,424,000 5,120,000

Tankship US West Coast 3,960,000 4,730,000 4,224,000 3,520,000

Notes:

1. Costs are for vendor supplied equipment and support only.

2. Costs based on ROMs from vendors (+/

‐ 20%) plus adjustments to level scope.

3. Vessel estimates based on propulsion plants.

4. Assume

‐ auxiliary engines combined into one large scrubber.

Exhaust Gas Cleaning Systems

Operators Guide Life Cycle Cost

‐ Scrubber Costs

Sheet 3 of 77 The Glosten Associates

File 10047.01, 12 January 2011Ship/RoutePairContainershipTranspacificContainershipAlaskatoPugetSoundTankshipUSWestCoastScrubberType OpenLoop OpenLoop OpenLoopVARIABLES‐CONTROLLEDInvestmentTermsLifeCycle(#ofYears)10 10 10AnalysisDate(Today)(Year)2011 2011 2011ScrubberInstallationDate(Year)2014 2014 2014DiscountRate(%)10.0% 10.0% 10.0%CapitalExpenseforScrubberEquipment(Today)(USD/OneTime)$5,260,000 $5,060,000 $3,960,000Engineering/Design(%EquipCost)7.0% 7.0% 7.0%Training/Documents(%EquipCost)2.0% 2.0% 2.0%Install/Commission(%EquipCost)50.0% 50.0% 50.0%OperatingExpense‐AnnualECAFuelConsumption(MT/Annual)6,212 9,636 10,840ChemicalConsumption(%ofFuelCost)0.0% 0.0% 0.0%ScrubberParasiticLoads(%ofFuelCost)2.0% 2.0% 2.0%DistillateCalorieCorrection(%ofFuelCost)4.0% 4.0% 4.0%HFOProcessandHeating(%ofFuelCost)0.8% 0.8% 0.8%OperatingEngineer(Today)(USD/Annual)$292,000 $292,000 $292,000OperatingEngineer(%ofPosition)50.0% 50.0% 50.0%M&REquipment(%EquipCost/Annual)4.0% 4.0% 4.0%Variables‐UncertainFuelDifferential(Today)(USD/MT)$255.50 $255.50 $255.50Fuel/ChemicalEscalationRate(%‐AnnualforOpPeriod)8.0% 8.0% 8.0%PersonnelInflationRate(%‐AnnualforOpPeriod)3.0% 3.0% 3.0%EquipmentInflationRate(%‐AnnualforOpPeriod)3.3% 3.3% 3.3%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐BaselineSummarySheet4of77TheGlostenAssociatesFile10047.01,12January2011AnalysisResults‐Overview(Nearest$1,000)CapitalCost(USD‐YearZeroDollars)(9,219,000) (8,868,000) (6,941,000)Expenses‐YearOne(USD‐YearOneDollars)(551,000) (623,000) (601,000)FuelSavings‐YearOne(USD‐YearOneDollars)2,159,000 3,350,000 3,768,000NetPresentValue(USD‐2011Dollars)4,851,000 14,562,000 20,110,000InternalRateofReturn(%)20% 36% 53%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐BaselineSummarySheet5of77TheGlostenAssociatesFile10047.01,12January2011InflationBaselineYearExpensesBaseline012345CapitalCost‐Total(9,219,000)Equipment(5,798,113)Acquisition(3,420,887)Expenses‐Total(550,743) (575,326) (601,257) (628,626) (657,525)DistillateCorrection(86,377) (93,287) (100,750) (108,810) (117,514)HFOProcess&Heating(17,275) (18,657) (20,150) (21,762) (23,503)OperatingEngineer(164,324) (169,254) (174,332) (179,562) (184,948)ChemicalConsumption00000ScrubberLoads(43,188) (46,643) (50,375) (54,405) (58,757)M&REquip&Labor(239,578) (247,484) (255,651) (264,088) (272,802)Savings‐FuelDifferential 2,159,415 2,332,168 2,518,742 2,720,241 2,937,860NPV&IRRCashFlow(9,219,000)1,608,673 1,756,843 1,917,485 2,091,616 2,280,335DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(9,219,000)1,462,430 1,451,936 1,440,635 1,428,602 1,415,909NetPresentValue(atYear0) 4,850,970InternalRateofReturn 19.54%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐BaselineDetailSheet6of77TheGlostenAssociatesFile10047.01,12January2011InflationBaselineExpensesBaselineCapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValue(atYear0)InternalRateofReturnYear6 7 8 9 10(688,058) (720,333) (754,467) (790,587) (828,826)(126,916) (137,069) (148,034) (159,877) (172,667)(25,383) (27,414) (29,607) (31,975) (34,533)(190,497) (196,212) (202,098) (208,161) (214,406)00000(63,458) (68,534) (74,017) (79,939) (86,334)(281,805) (291,105) (300,711) (310,634) (320,885)3,172,889 3,426,720 3,700,858 3,996,927 4,316,6812,484,831 2,706,387 2,946,391 3,206,340 3,487,8550.5645 0.5132 0.4665 0.4241 0.38551,402,622 1,388,805 1,374,513 1,359,801 1,344,719ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐BaselineDetailSheet7of77TheGlostenAssociatesFile10047.01,12January2011InflationBaselineYearExpensesBaseline012345CapitalCost‐Total(8,868,468)Equipment(5,577,653)Acquisition(3,290,815)Expenses‐Total(622,559) (653,316) (685,929) (720,528) (757,252)DistillateCorrection(133,980) (144,699) (156,275) (168,777) (182,279)HFOProcess&Heating(26,796) (28,940) (31,255) (33,755) (36,456)OperatingEngineer(164,324) (169,254) (174,332) (179,562) (184,948)ChemicalConsumption00000ScrubberLoads(66,990) (72,349) (78,137) (84,388) (91,139)M&REquip&Labor(230,469) (238,074) (245,931) (254,046) (262,430)Savings‐FuelDifferential 3,349,508 3,617,469 3,906,867 4,219,416 4,556,969NPV&IRRCashFlow(8,868,468)2,726,949 2,964,153 3,220,937 3,498,888 3,799,717DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(8,868,468)2,479,044 2,449,713 2,419,938 2,389,787 2,359,325NetPresentValue 14,562,028InternalRateofReturn 36.17%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐BaselineDetailSheet8of77TheGlostenAssociatesFile10047.01,12January2011InflationBaselineExpensesBaselineCapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(796,251) (837,685) (881,727) (928,564) (978,397)(196,861) (212,610) (229,619) (247,988) (267,827)(39,372) (42,522) (45,924) (49,598) (53,565)(190,497) (196,212) (202,098) (208,161) (214,406)00000(98,431) (106,305) (114,809) (123,994) (133,914)(271,090) (280,036) (289,277) (298,823) (308,684)4,921,527 5,315,249 5,740,469 6,199,706 6,695,6834,125,276 4,477,564 4,858,742 5,271,142 5,717,2860.5645 0.5132 0.4665 0.4241 0.38552,328,611 2,297,698 2,266,639 2,235,479 2,204,261ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐BaselineDetailSheet9of77TheGlostenAssociatesFile10047.01,12January2011InflationBaselineYearExpensesBaseline012345CapitalCost‐Total(6,940,540)Equipment(4,365,120)Acquisition(2,575,421)Expenses‐Total(600,928) (632,309) (665,674) (701,165) (738,936)DistillateCorrection(150,728) (162,786) (175,809) (189,874) (205,063)HFOProcess&Heating(30,146) (32,557) (35,162) (37,975) (41,013)OperatingEngineer(164,324) (169,254) (174,332) (179,562) (184,948)ChemicalConsumption00000ScrubberLoads(75,364) (81,393) (87,904) (94,937) (102,532)M&REquip&Labor(180,367) (186,319) (192,467) (198,819) (205,380)Savings‐FuelDifferential 3,768,194 4,069,650 4,395,222 4,746,839 5,126,587NPV&IRRCashFlow(6,940,540)3,167,266 3,437,341 3,729,548 4,045,674 4,387,650DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(6,940,540)2,879,333 2,840,777 2,802,064 2,763,250 2,724,386NetPresentValue 20,109,656InternalRateofReturn 52.62%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐BaselineDetailSheet10of77TheGlostenAssociatesFile10047.01,12January2011InflationBaselineExpensesBaselineCapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(779,151) (821,987) (867,634) (916,300) (968,204)(221,469) (239,186) (258,321) (278,987) (301,306)(44,294) (47,837) (51,664) (55,797) (60,261)(190,497) (196,212) (202,098) (208,161) (214,406)00000(110,734) (119,593) (129,160) (139,493) (150,653)(212,157) (219,159) (226,391) (233,862) (241,579)5,536,714 5,979,651 6,458,023 6,974,664 7,532,6384,757,563 5,157,664 5,590,388 6,058,365 6,564,4330.5645 0.5132 0.4665 0.4241 0.38552,685,520 2,646,697 2,607,957 2,569,338 2,530,873ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐BaselineDetailSheet11of77TheGlostenAssociatesFile10047.01,12January2011InflationYearExpenses012345CapitalCost‐Total 0Equipment 0Acquisition 0Expenses‐Total(169,254) (174,332) (179,562) (184,948) (190,497)DistillateCorrection00000HFOProcess&Heating00000OperatingEngineer(169,254) (174,332) (179,562) (184,948) (190,497)ChemicalConsumption00000ScrubberLoads00000M&REquip&Labor00000Savings‐FuelDifferential00000NPV&IRRCashFlow 0(169,254) (174,332) (179,562) (184,948) (190,497)DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue 0(153,867) (144,076) (134,907) (126,322) (118,284)NetPresentValue(1,165,101)InternalRateofReturn NONEExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐BaselineDetailSheet12of77TheGlostenAssociatesFile10047.01,12January2011InflationExpensesCapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(196,212) (202,098) (208,161) (214,406) (220,838)0000000000(196,212) (202,098) (208,161) (214,406) (220,838)00000000000000000000(196,212) (202,098) (208,161) (214,406) (220,838)0.5645 0.5132 0.4665 0.4241 0.3855(110,756) (103,708) (97,109) (90,929) (85,143)ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐BaselineDetailSheet13of77TheGlostenAssociatesFile10047.01,12January2011Ship/RoutePairContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundScrubberType OpenLoop ClosedLoop Hybrid DrySensitivityAnalysis ScrubberTypesOpenLoop ClosedLoop Hybrid DryVARIABLES‐CONTROLLEDInvestmentTermsLifeCycle(#ofYears)10 10 10 10AnalysisDate(Today)(Year)2011 2011 2011 2011ScrubberInstallationDate(Year)2014 2014 2014 2014DiscountRate(%)10.0% 10.0% 10.0% 10.0%CapitalExpenseforScrubberEquipment(Today)(USD/OneTime)$5,060,000 $6,180,000 $5,424,000 $5,120,000Engineering/Design(%EquipCost)7.0% 9.0% 9.0% 11.0%Training/Documents(%EquipCost)2.0% 2.0% 2.0% 2.0%Install/Commission(%EquipCost)50.0% 65.0% 75.0% 85.0%OperatingExpense‐AnnualECAFuelConsumption(MT/Annual)9,636 9,636 9,636 9,636ChemicalConsumption(%ofFuelCost)0.0% 3.0% 1.5% 3.0%ScrubberParasiticLoads(%ofFuelCost)2.0% 1.0% 1.5% 1.0%DistillateCalorieCorrection(%ofFuelCost)4.0% 4.0% 4.0% 4.0%HFOProcessandHeating(%ofFuelCost)0.8% 0.8% 0.8% 0.8%OperatingEngineer(Today)(USD/Annual)$292,000 $292,000 $292,000 $292,000OperatingEngineer(%ofPosition)50.0% 65.0% 65.0% 65.0%M&REquipment(%EquipCost/Annual)4.0% 4.0% 4.0% 4.0%Variables‐UncertainFuelDifferential(Today)(USD/MT)$255.50 $255.50 $255.50 $255.50Fuel/ChemicalEscalationRate(%‐AnnualforOpPeriod)8.0% 8.0% 8.0% 8.0%PersonnelInflationRate(%‐AnnualforOpPeriod)3.0% 3.0% 3.0% 3.0%EquipmentInflationRate(%‐AnnualforOpPeriod)3.3% 3.3% 3.3% 3.3%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐EGCSCompareSummarySheet14of77TheGlostenAssociatesFile10047.01,12January2011AnalysisResults‐Overview(Nearest$1,000)CapitalCost(USD‐YearZeroDollars)(8,868,000) (11,990,000) (11,121,000) (11,175,000)Expenses‐YearOne(USD‐YearOneDollars)(623,000) (790,000) (722,000) (742,000)FuelSavings‐YearOne(USD‐YearOneDollars)3,350,000 3,350,000 3,350,000 3,350,000NetPresentValue(USD‐PresentDollars)14,562,000 10,185,000 11,574,000 11,336,000InternalRateofReturn(%)36% 25% 28% 27%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐EGCSCompareSummarySheet15of77TheGlostenAssociatesFile10047.01,12January2011ScrubberTypesOpenLoopYear012345CapitalCost‐Total(8,868,468)Equipment(5,577,653)Acquisition(3,290,815)Expenses‐Total(622,559) (653,316) (685,929) (720,528) (757,252)DistillateCorrection(133,980) (144,699) (156,275) (168,777) (182,279)HFOProcess&Heating(26,796) (28,940) (31,255) (33,755) (36,456)OperatingEngineer(164,324) (169,254) (174,332) (179,562) (184,948)ChemicalConsumption00000ScrubberLoads(66,990) (72,349) (78,137) (84,388) (91,139)M&REquip&Labor(230,469) (238,074) (245,931) (254,046) (262,430)Savings‐FuelDifferential 3,349,508 3,617,469 3,906,867 4,219,416 4,556,969NPV&IRRCashFlow(8,868,468)2,726,949 2,964,153 3,220,937 3,498,888 3,799,717DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(8,868,468)2,479,044 2,449,713 2,419,938 2,389,787 2,359,325NetPresentValue(atYear0) 14,562,028InternalRateofReturn 36.17%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐EGCSCompareDetailsSheet16of77TheGlostenAssociatesFile10047.01,12January2011ScrubberTypesOpenLoopCapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValue(atYear0)InternalRateofReturnYear6 7 8 9 10(796,251) (837,685) (881,727) (928,564) (978,397)(196,861) (212,610) (229,619) (247,988) (267,827)(39,372) (42,522) (45,924) (49,598) (53,565)(190,497) (196,212) (202,098) (208,161) (214,406)00000(98,431) (106,305) (114,809) (123,994) (133,914)(271,090) (280,036) (289,277) (298,823) (308,684)4,921,527 5,315,249 5,740,469 6,199,706 6,695,6834,125,276 4,477,564 4,858,742 5,271,142 5,717,2860.5645 0.5132 0.4665 0.4241 0.38552,328,611 2,297,698 2,266,639 2,235,479 2,204,261ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐EGCSCompareDetailsSheet17of77TheGlostenAssociatesFile10047.01,12January2011ScrubberTypesClosedLoopYear012345CapitalCost‐Total(11,989,529)Equipment(6,812,232)Acquisition(5,177,296)Expenses‐Total(789,860) (829,138) (870,801) (915,016) (961,963)DistillateCorrection(133,980) (144,699) (156,275) (168,777) (182,279)HFOProcess&Heating(26,796) (28,940) (31,255) (33,755) (36,456)OperatingEngineer(213,622) (220,030) (226,631) (233,430) (240,433)ChemicalConsumption(100,485) (108,524) (117,206) (126,582) (136,709)ScrubberLoads(33,495) (36,175) (39,069) (42,194) (45,570)M&REquip&Labor(281,481) (290,770) (300,366) (310,278) (320,517)Savings‐FuelDifferential 3,349,508 3,617,469 3,906,867 4,219,416 4,556,969NPV&IRRCashFlow(11,989,529)2,559,649 2,788,331 3,036,065 3,304,399 3,595,006DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(11,989,529)2,326,953 2,304,406 2,281,041 2,256,949 2,232,216NetPresentValue 10,184,863InternalRateofReturn 24.71%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐EGCSCompareDetailsSheet18of77TheGlostenAssociatesFile10047.01,12January2011ScrubberTypesClosedLoopCapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(1,011,834) (1,064,837) (1,121,196) (1,181,149) (1,244,958)(196,861) (212,610) (229,619) (247,988) (267,827)(39,372) (42,522) (45,924) (49,598) (53,565)(247,646) (255,075) (262,728) (270,609) (278,728)(147,646) (159,457) (172,214) (185,991) (200,870)(49,215) (53,152) (57,405) (61,997) (66,957)(331,094) (342,020) (353,307) (364,966) (377,010)4,921,527 5,315,249 5,740,469 6,199,706 6,695,6833,909,692 4,250,411 4,619,273 5,018,557 5,450,7250.5645 0.5132 0.4665 0.4241 0.38552,206,919 2,181,133 2,154,925 2,128,358 2,101,491ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐EGCSCompareDetailsSheet19of77TheGlostenAssociatesFile10047.01,12January2011ScrubberTypesHybridYear012345CapitalCost‐Total(11,120,738)Equipment(5,978,891)Acquisition(5,141,846)Expenses‐Total(721,931) (757,393) (794,989) (834,866) (877,185)DistillateCorrection(133,980) (144,699) (156,275) (168,777) (182,279)HFOProcess&Heating(26,796) (28,940) (31,255) (33,755) (36,456)OperatingEngineer(213,622) (220,030) (226,631) (233,430) (240,433)ChemicalConsumption(50,243) (54,262) (58,603) (63,291) (68,355)ScrubberLoads(50,243) (54,262) (58,603) (63,291) (68,355)M&REquip&Labor(247,048) (255,200) (263,622) (272,321) (281,308)Savings‐FuelDifferential 3,349,508 3,617,469 3,906,867 4,219,416 4,556,969NPV&IRRCashFlow(11,120,738)2,627,577 2,860,076 3,111,878 3,384,550 3,679,785DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(11,120,738)2,388,707 2,363,699 2,338,000 2,311,693 2,284,857NetPresentValue 11,574,199InternalRateofReturn 27.61%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐EGCSCompareDetailsSheet20of77TheGlostenAssociatesFile10047.01,12January2011ScrubberTypesHybridCapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(922,116) (969,846) (1,020,571) (1,074,506) (1,131,881)(196,861) (212,610) (229,619) (247,988) (267,827)(39,372) (42,522) (45,924) (49,598) (53,565)(247,646) (255,075) (262,728) (270,609) (278,728)(73,823) (79,729) (86,107) (92,996) (100,435)(73,823) (79,729) (86,107) (92,996) (100,435)(290,591) (300,181) (310,087) (320,320) (330,890)4,921,527 5,315,249 5,740,469 6,199,706 6,695,6833,999,410 4,345,403 4,719,898 5,125,200 5,563,8020.5645 0.5132 0.4665 0.4241 0.38552,257,563 2,229,879 2,201,867 2,173,585 2,145,086ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐EGCSCompareDetailsSheet21of77TheGlostenAssociatesFile10047.01,12January2011ScrubberTypesDryYear012345CapitalCost‐Total(11,174,706)Equipment(5,643,791)Acquisition(5,530,915)Expenses‐Total(741,580) (779,265) (819,282) (861,797) (906,988)DistillateCorrection(133,980) (144,699) (156,275) (168,777) (182,279)HFOProcess&Heating(26,796) (28,940) (31,255) (33,755) (36,456)OperatingEngineer(213,622) (220,030) (226,631) (233,430) (240,433)ChemicalConsumption(100,485) (108,524) (117,206) (126,582) (136,709)ScrubberLoads(33,495) (36,175) (39,069) (42,194) (45,570)M&REquip&Labor(233,201) (240,897) (248,847) (257,059) (265,542)Savings‐FuelDifferential 3,349,508 3,617,469 3,906,867 4,219,416 4,556,969NPV&IRRCashFlow(11,174,706)2,607,929 2,838,204 3,087,584 3,357,619 3,649,981DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(11,174,706)2,370,844 2,345,624 2,319,748 2,293,299 2,266,351NetPresentValue 11,335,895InternalRateofReturn 27.22%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐EGCSCompareDetailsSheet22of77TheGlostenAssociatesFile10047.01,12January2011ScrubberTypesDryCapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(955,045) (1,006,174) (1,060,596) (1,118,550) (1,180,292)(196,861) (212,610) (229,619) (247,988) (267,827)(39,372) (42,522) (45,924) (49,598) (53,565)(247,646) (255,075) (262,728) (270,609) (278,728)(147,646) (159,457) (172,214) (185,991) (200,870)(49,215) (53,152) (57,405) (61,997) (66,957)(274,304) (283,356) (292,707) (302,367) (312,345)4,921,527 5,315,249 5,740,469 6,199,706 6,695,6833,966,482 4,309,075 4,679,873 5,081,156 5,515,3900.5645 0.5132 0.4665 0.4241 0.38552,238,976 2,211,237 2,183,195 2,154,906 2,126,422ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐EGCSCompareDetailsSheet23of77TheGlostenAssociatesFile10047.01,12January2011Ship/RoutePairContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundScrubberType OpenLoop OpenLoop OpenLoop OpenLoopSensitivityAnalysis FuelConsumption21% 50% 75% 100%VARIABLES‐CONTROLLEDInvestmentTermsLifeCycle(#ofYears)10 10 10 10AnalysisDate(Today)(Year)2011 2011 2011 2011ScrubberInstallationDate(Year)2014 2014 2014 2014DiscountRate(%)10.0% 10.0% 10.0% 10.0%CapitalExpenseforScrubberEquipment(Today)(USD/OneTime)$5,060,000 $5,060,000 $5,060,000 $5,060,000Engineering/Design(%EquipCost)7.0% 7.0% 7.0% 7.0%Training/Documents(%EquipCost)2.0% 2.0% 2.0% 2.0%Install/Commission(%EquipCost)50.0% 50.0% 50.0% 50.0%OperatingExpense‐AnnualECAFuelConsumption(MT/Annual)4,000 9,523 14,285 19,046ChemicalConsumption(%ofFuelCost)0.0% 0.0% 0.0% 0.0%ScrubberParasiticLoads(%ofFuelCost)2.0% 2.0% 2.0% 2.0%DistillateCalorieCorrection(%ofFuelCost)4.0% 4.0% 4.0% 4.0%HFOProcessandHeating(%ofFuelCost)0.8% 0.8% 0.8% 0.8%OperatingEngineer(Today)(USD/Annual)$292,000 $292,000 $292,000 $292,000OperatingEngineer(%ofPosition)50.0% 50.0% 50.0% 50.0%M&REquipment(%EquipCost/Annual)4.0% 4.0% 4.0% 4.0%Variables‐UncertainFuelDifferential(Today)(USD/MT)$255.50 $255.50 $255.50 $255.50Fuel/ChemicalEscalationRate(%‐AnnualforOpPeriod)8.0% 8.0% 8.0% 8.0%PersonnelInflationRate(%‐AnnualforOpPeriod)3.0% 3.0% 3.0% 3.0%EquipmentInflationRate(%‐AnnualforOpPeriod)3.3% 3.3% 3.3% 3.3%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐FuelConsumptionSummarySheet24of77TheGlostenAssociatesFile10047.01,12January2011AnalysisResults‐Overview(Nearest$1,000)CapitalCost(USD‐YearZeroDollars)(8,868,000) (8,868,000) (8,868,000) (8,868,000)Expenses‐YearOne(USD‐YearOneDollars)(489,000) (620,000) (732,000) (845,000)FuelSavings‐YearOne(USD‐YearOneDollars)1,390,000 3,310,000 4,965,000 6,621,000NetPresentValue(USD‐PresentDollars)(743,000) 14,256,000 27,186,000 40,116,000InternalRateofReturn(%)8% 36% 55% 73%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐FuelConsumptionSummarySheet25of77TheGlostenAssociatesFile10047.01,12January2011FuelConsumption0.21Year012345CapitalCost‐Total(8,868,468)Equipment(5,577,653)Acquisition(3,290,815)Expenses‐Total(489,336) (509,434) (530,537) (552,704) (576,002)DistillateCorrection(55,613) (60,062) (64,867) (70,057) (75,661)HFOProcess&Heating(11,123) (12,012) (12,973) (14,011) (15,132)OperatingEngineer(164,324) (169,254) (174,332) (179,562) (184,948)ChemicalConsumption00000ScrubberLoads(27,807) (30,031) (32,434) (35,028) (37,831)M&REquip&Labor(230,469) (238,074) (245,931) (254,046) (262,430)Savings‐FuelDifferential 1,390,333 1,501,560 1,621,684 1,751,419 1,891,533NPV&IRRCashFlow(8,868,468)900,997 992,125 1,091,148 1,198,715 1,315,530DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(8,868,468)819,089 819,938 819,795 818,738 816,841NetPresentValue(atYear0)(743,184)InternalRateofReturn 8.28%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐FuelConsumptionDetailsSheet26of77TheGlostenAssociatesFile10047.01,12January2011FuelConsumption0.21CapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValue(atYear0)InternalRateofReturnYear6 7 8 9 10(600,501) (626,275) (653,405) (681,976) (712,082)(81,714) (88,251) (95,311) (102,936) (111,171)(16,343) (17,650) (19,062) (20,587) (22,234)(190,497) (196,212) (202,098) (208,161) (214,406)00000(40,857) (44,126) (47,656) (51,468) (55,586)(271,090) (280,036) (289,277) (298,823) (308,684)2,042,855 2,206,284 2,382,786 2,573,409 2,779,2821,442,354 1,580,009 1,729,382 1,891,433 2,067,2010.5645 0.5132 0.4665 0.4241 0.3855814,171 810,794 806,769 802,152 796,995ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐FuelConsumptionDetailsSheet27of77TheGlostenAssociatesFile10047.01,12January2011FuelConsumption0.5Year012345CapitalCost‐Total(8,868,468)Equipment(5,577,653)Acquisition(3,290,815)Expenses‐Total(619,894) (650,438) (682,821) (717,171) (753,626)DistillateCorrection(132,413) (143,006) (154,446) (166,802) (180,146)HFOProcess&Heating(26,483) (28,601) (30,889) (33,360) (36,029)OperatingEngineer(164,324) (169,254) (174,332) (179,562) (184,948)ChemicalConsumption00000ScrubberLoads(66,206) (71,503) (77,223) (83,401) (90,073)M&REquip&Labor(230,469) (238,074) (245,931) (254,046) (262,430)Savings‐FuelDifferential 3,310,317 3,575,142 3,861,153 4,170,046 4,503,649NPV&IRRCashFlow(8,868,468)2,690,422 2,924,704 3,178,333 3,452,875 3,750,023DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(8,868,468)2,445,838 2,417,111 2,387,928 2,358,360 2,328,469NetPresentValue 14,255,860InternalRateofReturn 35.69%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐FuelConsumptionDetailsSheet28of77TheGlostenAssociatesFile10047.01,12January2011FuelConsumption0.5CapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(792,335) (833,456) (877,160) (923,632) (973,069)(194,558) (210,122) (226,932) (245,087) (264,694)(38,912) (42,024) (45,386) (49,017) (52,939)(190,497) (196,212) (202,098) (208,161) (214,406)00000(97,279) (105,061) (113,466) (122,543) (132,347)(271,090) (280,036) (289,277) (298,823) (308,684)4,863,941 5,253,056 5,673,301 6,127,165 6,617,3384,071,606 4,419,601 4,796,141 5,203,534 5,644,2690.5645 0.5132 0.4665 0.4241 0.38552,298,316 2,267,954 2,237,435 2,206,806 2,176,110ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐FuelConsumptionDetailsSheet29of77TheGlostenAssociatesFile10047.01,12January2011FuelConsumption0.75Year012345CapitalCost‐Total(8,868,468)Equipment(5,577,653)Acquisition(3,290,815)Expenses‐Total(732,445) (771,993) (814,100) (858,952) (906,750)DistillateCorrection(198,619) (214,509) (231,669) (250,203) (270,219)HFOProcess&Heating(39,724) (42,902) (46,334) (50,041) (54,044)OperatingEngineer(164,324) (169,254) (174,332) (179,562) (184,948)ChemicalConsumption00000ScrubberLoads(99,309) (107,254) (115,835) (125,101) (135,109)M&REquip&Labor(230,469) (238,074) (245,931) (254,046) (262,430)Savings‐FuelDifferential 4,965,475 5,362,713 5,791,730 6,255,068 6,755,474NPV&IRRCashFlow(8,868,468)4,233,030 4,590,720 4,977,630 5,396,116 5,848,723DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(8,868,468)3,848,209 3,793,984 3,739,767 3,685,620 3,631,597NetPresentValue 27,186,070InternalRateofReturn 54.79%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐FuelConsumptionDetailsSheet30of77TheGlostenAssociatesFile10047.01,12January2011FuelConsumption0.75CapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(957,709) (1,012,059) (1,070,052) (1,131,955) (1,198,059)(291,836) (315,183) (340,398) (367,630) (397,040)(58,367) (63,037) (68,080) (73,526) (79,408)(190,497) (196,212) (202,098) (208,161) (214,406)00000(145,918) (157,592) (170,199) (183,815) (198,520)(271,090) (280,036) (289,277) (298,823) (308,684)7,295,912 7,879,585 8,509,951 9,190,748 9,926,0076,338,203 6,867,525 7,439,900 8,058,792 8,727,9490.5645 0.5132 0.4665 0.4241 0.38553,577,750 3,524,126 3,470,768 3,417,715 3,365,002ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐FuelConsumptionDetailsSheet31of77TheGlostenAssociatesFile10047.01,12January2011FuelConsumption1Year012345CapitalCost‐Total(8,868,468)Equipment(5,577,653)Acquisition(3,290,815)Expenses‐Total(844,996) (893,547) (945,379) (1,000,734) (1,059,874)DistillateCorrection(264,825) (286,011) (308,892) (333,604) (360,292)HFOProcess&Heating(52,965) (57,202) (61,778) (66,721) (72,058)OperatingEngineer(164,324) (169,254) (174,332) (179,562) (184,948)ChemicalConsumption00000ScrubberLoads(132,413) (143,006) (154,446) (166,802) (180,146)M&REquip&Labor(230,469) (238,074) (245,931) (254,046) (262,430)Savings‐FuelDifferential 6,620,633 7,150,284 7,722,307 8,340,091 9,007,298NPV&IRRCashFlow(8,868,468)5,775,637 6,256,737 6,776,928 7,339,357 7,947,424DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(8,868,468)5,250,579 5,170,857 5,091,606 5,012,880 4,934,725NetPresentValue 40,116,280InternalRateofReturn 72.83%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐FuelConsumptionDetailsSheet32of77TheGlostenAssociatesFile10047.01,12January2011FuelConsumption1CapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(1,123,083) (1,190,663) (1,262,944) (1,340,279) (1,423,048)(389,115) (420,245) (453,864) (490,173) (529,387)(77,823) (84,049) (90,773) (98,035) (105,877)(190,497) (196,212) (202,098) (208,161) (214,406)00000(194,558) (210,122) (226,932) (245,087) (264,694)(271,090) (280,036) (289,277) (298,823) (308,684)9,727,882 10,506,113 11,346,602 12,254,330 13,234,6778,604,800 9,315,450 10,083,658 10,914,051 11,811,6280.5645 0.5132 0.4665 0.4241 0.38554,857,185 4,780,299 4,704,101 4,628,623 4,553,894ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐FuelConsumptionDetailsSheet33of77TheGlostenAssociatesFile10047.01,12January2011Ship/RoutePairContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundScrubberType OpenLoop OpenLoop OpenLoop OpenLoopSensitivityAnalysis InflationLow Moderate Predicted HighFuelEscalation Low Moderate Predicted HighVARIABLES‐CONTROLLEDInvestmentTermsLifeCycle(#ofYears)10 10 10 10AnalysisDate(Today)(Year)2011 2011 2011 2011ScrubberInstallationDate(Year)2014 2014 2014 2014DiscountRate(%)10.0% 10.0% 10.0% 10.0%CapitalExpenseforScrubberEquipment(Today)(USD/OneTime)$5,060,000 $5,060,000 $5,060,000 $5,060,000Engineering/Design(%EquipCost)7.0% 7.0% 7.0% 7.0%Training/Documents(%EquipCost)2.0% 2.0% 2.0% 2.0%Install/Commission(%EquipCost)50.0% 50.0% 50.0% 50.0%OperatingExpense‐AnnualECAFuelConsumption(MT/Annual)9,636 9,636 9,636 9,636ChemicalConsumption(%ofFuelCost)0.0% 0.0% 0.0% 0.0%ScrubberParasiticLoads(%ofFuelCost)2.0% 2.0% 2.0% 2.0%DistillateCalorieCorrection(%ofFuelCost)4.0% 4.0% 4.0% 4.0%HFOProcessandHeating(%ofFuelCost)0.8% 0.8% 0.8% 0.8%OperatingEngineer(Today)(USD/Annual)$292,000 $292,000 $292,000 $292,000OperatingEngineer(%ofPosition)50.0% 50.0% 50.0% 50.0%M&REquipment(%EquipCost/Annual)4.0% 4.0% 4.0% 4.0%Variables‐UncertainFuelDifferential(Today)(USD/MT)$255.50 $255.50 $255.50 $255.50Fuel/ChemicalEscalationRate(%‐AnnualforOpPeriod)2.0% 5.0% 8.0% 11.0%PersonnelInflationRate(%‐AnnualforOpPeriod)1.0% 2.0% 3.0% 5.0%EquipmentInflationRate(%‐AnnualforOpPeriod)1.0% 2.0% 3.3% 5.0%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐InflationSummarySheet34of77TheGlostenAssociatesFile10047.01,12January2011AnalysisResults‐Overview(Nearest$1,000)CapitalCost(USD‐YearZeroDollars)(8,289,000) (8,538,000) (8,868,000) (8,669,000)Expenses‐YearOne(USD‐YearOneDollars)(544,000) (581,000) (623,000) (678,000)FuelSavings‐YearOne(USD‐YearOneDollars)2,665,000 2,993,000 3,350,000 3,737,000NetPresentValue(USD‐PresentDollars)5,854,000 9,714,000 14,562,000 21,174,000InternalRateofReturn(%)24% 30% 36% 44%11.52016187 14.46884962 17.36018386 0.346456441ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐InflationSummarySheet35of77TheGlostenAssociatesFile10047.01,12January2011InflationLowYearFuelEscalationLow012345CapitalCost‐Total(8,289,184)Equipment(5,213,323)Acquisition(3,075,861)Expenses‐Total(543,762) (551,012) (558,370) (565,839) (573,421)DistillateCorrection(106,597) (108,729) (110,904) (113,122) (115,384)HFOProcess&Heating(21,319) (21,746) (22,181) (22,624) (23,077)OperatingEngineer(151,928) (153,447) (154,982) (156,532) (158,097)ChemicalConsumption00000ScrubberLoads(53,299) (54,365) (55,452) (56,561) (57,692)M&REquip&Labor(210,618) (212,724) (214,852) (217,000) (219,170)Savings‐FuelDifferential 2,664,936 2,718,234 2,772,599 2,828,051 2,884,612NPV&IRRCashFlow(8,289,184)2,121,174 2,167,223 2,214,229 2,262,212 2,311,191DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(8,289,184)1,928,340 1,791,093 1,663,583 1,545,121 1,435,068NetPresentValue(atYear0) 5,853,509InternalRateofReturn 24.10%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐InflationDetailsSheet36of77TheGlostenAssociatesFile10047.01,12January2011InflationLowFuelEscalationLowCapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValue(atYear0)InternalRateofReturnYear6 7 8 9 10(581,117) (588,929) (596,859) (604,909) (613,081)(117,692) (120,046) (122,447) (124,896) (127,394)(23,538) (24,009) (24,489) (24,979) (25,479)(159,678) (161,275) (162,888) (164,516) (166,162)00000(58,846) (60,023) (61,223) (62,448) (63,697)(221,362) (223,576) (225,811) (228,069) (230,350)2,942,304 3,001,150 3,061,173 3,122,397 3,184,8452,361,188 2,412,222 2,464,315 2,517,488 2,571,7640.5645 0.5132 0.4665 0.4241 0.38551,332,829 1,237,851 1,149,621 1,067,661 991,526ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐InflationDetailsSheet37of77TheGlostenAssociatesFile10047.01,12January2011InflationModerateYearFuelEscalationModerate012345CapitalCost‐Total(8,537,843)Equipment(5,369,712)Acquisition(3,168,130)Expenses‐Total(580,614) (598,331) (616,707) (635,772) (655,555)DistillateCorrection(119,703) (125,688) (131,972) (138,571) (145,499)HFOProcess&Heating(23,941) (25,138) (26,394) (27,714) (29,100)OperatingEngineer(158,035) (161,196) (164,420) (167,708) (171,062)ChemicalConsumption00000ScrubberLoads(59,851) (62,844) (65,986) (69,285) (72,750)M&REquip&Labor(219,084) (223,466) (227,935) (232,494) (237,144)Savings‐FuelDifferential 2,992,563 3,142,191 3,299,300 3,464,265 3,637,479NPV&IRRCashFlow(8,537,843)2,411,949 2,543,860 2,682,593 2,828,493 2,981,924DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(8,537,843)2,192,681 2,102,364 2,015,472 1,931,899 1,851,540NetPresentValue 9,713,769InternalRateofReturn 30.28%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐InflationDetailsSheet38of77TheGlostenAssociatesFile10047.01,12January2011InflationModerateFuelEscalationModerateCapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(676,086) (697,399) (719,528) (742,509) (766,379)(152,774) (160,413) (168,433) (176,855) (185,698)(30,555) (32,083) (33,687) (35,371) (37,140)(174,484) (177,973) (181,533) (185,163) (188,867)00000(76,387) (80,206) (84,217) (88,428) (92,849)(241,887) (246,724) (251,659) (256,692) (261,826)3,819,352 4,010,320 4,210,836 4,421,378 4,642,4473,143,266 3,312,921 3,491,308 3,678,869 3,876,0680.5645 0.5132 0.4665 0.4241 0.38551,774,292 1,700,052 1,628,721 1,560,199 1,494,392ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐InflationDetailsSheet39of77TheGlostenAssociatesFile10047.01,12January2011InflationPredictedYearFuelEscalationPredicted012345CapitalCost‐Total(8,868,468)Equipment(5,577,653)Acquisition(3,290,815)Expenses‐Total(622,559) (653,316) (685,929) (720,528) (757,252)DistillateCorrection(133,980) (144,699) (156,275) (168,777) (182,279)HFOProcess&Heating(26,796) (28,940) (31,255) (33,755) (36,456)OperatingEngineer(164,324) (169,254) (174,332) (179,562) (184,948)ChemicalConsumption00000ScrubberLoads(66,990) (72,349) (78,137) (84,388) (91,139)M&REquip&Labor(230,469) (238,074) (245,931) (254,046) (262,430)Savings‐FuelDifferential 3,349,508 3,617,469 3,906,867 4,219,416 4,556,969NPV&IRRCashFlow(8,868,468)2,726,949 2,964,153 3,220,937 3,498,888 3,799,717DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(8,868,468)2,479,044 2,449,713 2,419,938 2,389,787 2,359,325NetPresentValue 14,562,028InternalRateofReturn 36.17%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐InflationDetailsSheet40of77TheGlostenAssociatesFile10047.01,12January2011InflationPredictedFuelEscalationPredictedCapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(796,251) (837,685) (881,727) (928,564) (978,397)(196,861) (212,610) (229,619) (247,988) (267,827)(39,372) (42,522) (45,924) (49,598) (53,565)(190,497) (196,212) (202,098) (208,161) (214,406)00000(98,431) (106,305) (114,809) (123,994) (133,914)(271,090) (280,036) (289,277) (298,823) (308,684)4,921,527 5,315,249 5,740,469 6,199,706 6,695,6834,125,276 4,477,564 4,858,742 5,271,142 5,717,2860.5645 0.5132 0.4665 0.4241 0.38552,328,611 2,297,698 2,266,639 2,235,479 2,204,261ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐InflationDetailsSheet41of77TheGlostenAssociatesFile10047.01,12January2011InflationHighYearFuelEscalationHigh012345CapitalCost‐Total(8,669,297)Equipment(5,213,323)Acquisition(3,455,974)Expenses‐Total(677,630) (726,761) (780,025) (837,815) (900,560)DistillateCorrection(149,499) (165,944) (184,198) (204,459) (226,950)HFOProcess&Heating(29,900) (33,189) (36,840) (40,892) (45,390)OperatingEngineer(177,464) (186,337) (195,654) (205,437) (215,708)ChemicalConsumption00000ScrubberLoads(74,749) (82,972) (92,099) (102,230) (113,475)M&REquip&Labor(246,018) (258,319) (271,235) (284,797) (299,037)Savings‐FuelDifferential 3,737,472 4,148,594 4,604,939 5,111,483 5,673,746NPV&IRRCashFlow(8,669,297)3,059,842 3,421,833 3,824,914 4,273,668 4,773,186DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(8,669,297)2,781,674 2,827,961 2,873,715 2,918,973 2,963,773NetPresentValue 21,174,017InternalRateofReturn 44.30%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐InflationDetailsSheet42of77TheGlostenAssociatesFile10047.01,12January2011InflationHighFuelEscalationHighCapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(968,737) (1,042,869) (1,123,534) (1,211,370) (1,307,080)(251,914) (279,625) (310,384) (344,526) (382,424)(50,383) (55,925) (62,077) (68,905) (76,485)(226,494) (237,819) (249,710) (262,195) (275,305)00000(125,957) (139,812) (155,192) (172,263) (191,212)(313,989) (329,688) (346,173) (363,481) (381,655)6,297,858 6,990,622 7,759,591 8,613,146 9,560,5925,329,121 5,947,753 6,636,056 7,401,775 8,253,5110.5645 0.5132 0.4665 0.4241 0.38553,008,150 3,052,138 3,095,769 3,139,075 3,182,086ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐InflationDetailsSheet43of77TheGlostenAssociatesFile10047.01,12January2011Ship/RoutePairContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundScrubberType OpenLoop OpenLoop OpenLoop OpenLoopSensitivityAnalysis OpeatingYearsMinimum 10 15 20VARIABLES‐CONTROLLEDInvestmentTermsLifeCycle(#ofYears)4 10 15 20AnalysisDate(Today)(Year)2011 2011 2011 2011ScrubberInstallationDate(Year)2014 2014 2014 2014DiscountRate(%)10.0% 10.0% 10.0% 10.0%CapitalExpenseforScrubberEquipment(Today)(USD/OneTime)$5,060,000 $5,060,000 $5,060,000 $5,060,000Engineering/Design(%EquipCost)7.0% 7.0% 7.0% 7.0%Training/Documents(%EquipCost)2.0% 2.0% 2.0% 2.0%Install/Commission(%EquipCost)50.0% 50.0% 50.0% 50.0%OperatingExpense‐AnnualECAFuelConsumption(MT/Annual)9,636 9,636 9,636 9,636ChemicalConsumption(%ofFuelCost)0.0% 0.0% 0.0% 0.0%ScrubberParasiticLoads(%ofFuelCost)2.0% 2.0% 2.0% 2.0%DistillateCalorieCorrection(%ofFuelCost)4.0% 4.0% 4.0% 4.0%HFOProcessandHeating(%ofFuelCost)0.8% 0.8% 0.8% 0.8%OperatingEngineer(Today)(USD/Annual)$292,000 $292,000 $292,000 $292,000OperatingEngineer(%ofPosition)50.0% 50.0% 50.0% 50.0%M&REquipment(%EquipCost/Annual)4.0% 4.0% 4.0% 4.0%Variables‐UncertainFuelDifferential(Today)(USD/MT)$255.50 $255.50 $255.50 $255.50Fuel/ChemicalEscalationRate(%‐AnnualforOpPeriod)8.0% 8.0% 8.0% 8.0%PersonnelInflationRate(%‐AnnualforOpPeriod)3.0% 3.0% 3.0% 3.0%EquipmentInflationRate(%‐AnnualforOpPeriod)3.3% 3.3% 3.3% 3.3%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐OpYearsSummarySheet44of77TheGlostenAssociatesFile10047.01,12January2011AnalysisResults‐Overview(Nearest$1,000)CapitalCost(USD‐YearZeroDollars)(8,868,000) (8,868,000) (8,868,000) (8,868,000)Expenses‐YearOne(USD‐YearOneDollars)(623,000) (623,000) (623,000) (623,000)FuelSavings‐YearOne(USD‐YearOneDollars)3,350,000 3,350,000 3,350,000 3,350,000NetPresentValue(USD‐PresentDollars)(1,520,000) 14,562,000 14,562,000 14,562,000InternalRateofReturn(%)0% 36% 36% 36%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐OpYearsSummarySheet45of77TheGlostenAssociatesFile10047.01,12January2011OpeatingYearsMinimumYear012345CapitalCost‐Total(8,868,468)Equipment(5,577,653)Acquisition(3,290,815)Expenses‐Total(622,559) (653,316) (685,929)DistillateCorrection(133,980) (144,699) (156,275)HFOProcess&Heating(26,796) (28,940) (31,255)OperatingEngineer(164,324) (169,254) (174,332)ChemicalConsumption 0 0 0ScrubberLoads(66,990) (72,349) (78,137)M&REquip&Labor(230,469) (238,074) (245,931)Savings‐FuelDifferential 3,349,508 3,617,469 3,906,867NPV&IRRCashFlow(8,868,468)2,726,949 2,964,153 3,220,937DiscountFactor 1.0000 0.9091 0.8264 0.7513PresentValue(8,868,468)2,479,044 2,449,713 2,419,938NetPresentValue(atYear0)(1,519,772)InternalRateofReturn 0.24%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐OpYearsDetailsSheet46of77TheGlostenAssociatesFile10047.01,12January2011OpeatingYearsMinimumCapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValue(atYear0)InternalRateofReturnYear6 7 8 9 10ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐OpYearsDetailsSheet47of77TheGlostenAssociatesFile10047.01,12January2011OpeatingYears10Year012345CapitalCost‐Total(8,868,468)Equipment(5,577,653)Acquisition(3,290,815)Expenses‐Total(622,559) (653,316) (685,929) (720,528) (757,252)DistillateCorrection(133,980) (144,699) (156,275) (168,777) (182,279)HFOProcess&Heating(26,796) (28,940) (31,255) (33,755) (36,456)OperatingEngineer(164,324) (169,254) (174,332) (179,562) (184,948)ChemicalConsumption00000ScrubberLoads(66,990) (72,349) (78,137) (84,388) (91,139)M&REquip&Labor(230,469) (238,074) (245,931) (254,046) (262,430)Savings‐FuelDifferential 3,349,508 3,617,469 3,906,867 4,219,416 4,556,969NPV&IRRCashFlow(8,868,468)2,726,949 2,964,153 3,220,937 3,498,888 3,799,717DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(8,868,468)2,479,044 2,449,713 2,419,938 2,389,787 2,359,325NetPresentValue 14,562,028InternalRateofReturn 36.17%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐OpYearsDetailsSheet48of77TheGlostenAssociatesFile10047.01,12January2011OpeatingYears10CapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(796,251) (837,685) (881,727) (928,564) (978,397)(196,861) (212,610) (229,619) (247,988) (267,827)(39,372) (42,522) (45,924) (49,598) (53,565)(190,497) (196,212) (202,098) (208,161) (214,406)00000(98,431) (106,305) (114,809) (123,994) (133,914)(271,090) (280,036) (289,277) (298,823) (308,684)4,921,527 5,315,249 5,740,469 6,199,706 6,695,6834,125,276 4,477,564 4,858,742 5,271,142 5,717,2860.5645 0.5132 0.4665 0.4241 0.38552,328,611 2,297,698 2,266,639 2,235,479 2,204,261ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐OpYearsDetailsSheet49of77TheGlostenAssociatesFile10047.01,12January2011OpeatingYears15Year012345CapitalCost‐Total(8,868,468)Equipment(5,577,653)Acquisition(3,290,815)Expenses‐Total(622,559) (653,316) (685,929) (720,528) (757,252)DistillateCorrection(133,980) (144,699) (156,275) (168,777) (182,279)HFOProcess&Heating(26,796) (28,940) (31,255) (33,755) (36,456)OperatingEngineer(164,324) (169,254) (174,332) (179,562) (184,948)ChemicalConsumption00000ScrubberLoads(66,990) (72,349) (78,137) (84,388) (91,139)M&REquip&Labor(230,469) (238,074) (245,931) (254,046) (262,430)Savings‐FuelDifferential 3,349,508 3,617,469 3,906,867 4,219,416 4,556,969NPV&IRRCashFlow(8,868,468)2,726,949 2,964,153 3,220,937 3,498,888 3,799,717DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(8,868,468)2,479,044 2,449,713 2,419,938 2,389,787 2,359,325NetPresentValue 14,562,028InternalRateofReturn 36.17%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐OpYearsDetailsSheet50of77TheGlostenAssociatesFile10047.01,12January2011OpeatingYears15CapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(796,251) (837,685) (881,727) (928,564) (978,397)(196,861) (212,610) (229,619) (247,988) (267,827)(39,372) (42,522) (45,924) (49,598) (53,565)(190,497) (196,212) (202,098) (208,161) (214,406)00000(98,431) (106,305) (114,809) (123,994) (133,914)(271,090) (280,036) (289,277) (298,823) (308,684)4,921,527 5,315,249 5,740,469 6,199,706 6,695,6834,125,276 4,477,564 4,858,742 5,271,142 5,717,2860.5645 0.5132 0.4665 0.4241 0.38552,328,611 2,297,698 2,266,639 2,235,479 2,204,261ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐OpYearsDetailsSheet51of77TheGlostenAssociatesFile10047.01,12January2011OpeatingYears1511 12 13 14 15CapitalCost‐TotalEquipmentAcquisitionExpenses‐Total(1,031,440) (1,087,926) (1,148,106) (1,212,248) (1,280,641)DistillateCorrection(289,253) (312,394) (337,385) (364,376) (393,526)HFOProcess&Heating(57,851) (62,479) (67,477) (72,875) (78,705)OperatingEngineer(220,838) (227,463) (234,287) (241,316) (248,555)ChemicalConsumption 00000ScrubberLoads(144,627) (156,197) (168,693) (182,188) (196,763)M&REquip&Labor(318,871) (329,394) (340,264) (351,492) (363,092)Savings‐FuelDifferential 7,231,337 7,809,844 8,434,632 9,109,402 9,838,155NPV&IRRCashFlow 6,199,897 6,721,918 7,286,526 7,897,155 8,557,513DiscountFactor 0.3505 0.3186 0.2897 0.2633 0.2394PresentValue 2,173,026 2,141,810 2,110,647 2,079,568 2,048,601NetPresentValueInternalRateofReturnExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐OpYearsDetailsSheet52of77TheGlostenAssociatesFile10047.01,12January2011OpeatingYears15CapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnPageNotUsedExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐OpYearsDetailsSheet53of77TheGlostenAssociatesFile10047.01,12January2011OpeatingYears20Year012345CapitalCost‐Total(8,868,468)Equipment(5,577,653)Acquisition(3,290,815)Expenses‐Total(622,559) (653,316) (685,929) (720,528) (757,252)DistillateCorrection(133,980) (144,699) (156,275) (168,777) (182,279)HFOProcess&Heating(26,796) (28,940) (31,255) (33,755) (36,456)OperatingEngineer(164,324) (169,254) (174,332) (179,562) (184,948)ChemicalConsumption00000ScrubberLoads(66,990) (72,349) (78,137) (84,388) (91,139)M&REquip&Labor(230,469) (238,074) (245,931) (254,046) (262,430)Savings‐FuelDifferential 3,349,508 3,617,469 3,906,867 4,219,416 4,556,969NPV&IRRCashFlow(8,868,468)2,726,949 2,964,153 3,220,937 3,498,888 3,799,717DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(8,868,468)2,479,044 2,449,713 2,419,938 2,389,787 2,359,325NetPresentValue 14,562,028InternalRateofReturn 36.17%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐OpYearsDetailsSheet54of77TheGlostenAssociatesFile10047.01,12January2011OpeatingYears20CapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(796,251) (837,685) (881,727) (928,564) (978,397)(196,861) (212,610) (229,619) (247,988) (267,827)(39,372) (42,522) (45,924) (49,598) (53,565)(190,497) (196,212) (202,098) (208,161) (214,406)00000(98,431) (106,305) (114,809) (123,994) (133,914)(271,090) (280,036) (289,277) (298,823) (308,684)4,921,527 5,315,249 5,740,469 6,199,706 6,695,6834,125,276 4,477,564 4,858,742 5,271,142 5,717,2860.5645 0.5132 0.4665 0.4241 0.38552,328,611 2,297,698 2,266,639 2,235,479 2,204,261ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐OpYearsDetailsSheet55of77TheGlostenAssociatesFile10047.01,12January2011OpeatingYears2011 12 13 14 15 16CapitalCost‐TotalEquipmentAcquisitionExpenses‐Total(1,031,440) (1,087,926) (1,148,106) (1,212,248) (1,280,641) (1,353,600)DistillateCorrection(289,253) (312,394) (337,385) (364,376) (393,526) (425,008)HFOProcess&Heating(57,851) (62,479) (67,477) (72,875) (78,705) (85,002)OperatingEngineer(220,838) (227,463) (234,287) (241,316) (248,555) (256,012)ChemicalConsumption 000000ScrubberLoads(144,627) (156,197) (168,693) (182,188) (196,763) (212,504)M&REquip&Labor(318,871) (329,394) (340,264) (351,492) (363,092) (375,074)Savings‐FuelDifferential 7,231,337 7,809,844 8,434,632 9,109,402 9,838,155 10,625,207NPV&IRRCashFlow 6,199,897 6,721,918 7,286,526 7,897,155 8,557,513 9,271,607DiscountFactor 0.3505 0.3186 0.2897 0.2633 0.2394 0.2176PresentValue 2,173,026 2,141,810 2,110,647 2,079,568 2,048,601 2,017,772NetPresentValueInternalRateofReturnExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐OpYearsDetailsSheet56of77TheGlostenAssociatesFile10047.01,12January2011OpeatingYears20CapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturn17 18 19 20(1,431,459) (1,514,580) (1,603,356) (1,698,205)(459,009) (495,730) (535,388) (578,219)(91,802) (99,146) (107,078) (115,644)(263,692) (271,603) (279,751) (288,144)0000(229,504) (247,865) (267,694) (289,110)(387,451) (400,237) (413,445) (427,089)11,475,224 12,393,241 13,384,701 14,455,47710,043,765 10,878,661 11,781,345 12,757,2720.1978 0.1799 0.1635 0.14861,987,105 1,956,623 1,926,344 1,896,287ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐OpYearsDetailsSheet57of77TheGlostenAssociatesFile10047.01,12January2011Ship/RoutePairContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundScrubberType OpenLoop OpenLoop OpenLoop OpenLoopSensitivityAnalysis ExpensesLow Predicted High V.HighVARIABLES‐CONTROLLEDInvestmentTermsLifeCycle(#ofYears)10 10 10 10AnalysisDate(Today)(Year)2011 2011 2011 2011ScrubberInstallationDate(Year)2014 2014 2014 2014DiscountRate(%)10.0% 10.0% 10.0% 10.0%CapitalExpenseforScrubberEquipment(Today)(USD/OneTime)$3,795,000 $5,060,000 $5,566,000 $6,325,000Engineering/Design(%EquipCost)5.3% 7.0% 8.8% 11.0%Training/Documents(%EquipCost)1.5% 2.0% 2.5% 2.0%Install/Commission(%EquipCost)37.5% 50.0% 62.5% 65.0%OperatingExpense‐AnnualECAFuelConsumption(MT/Annual)9,636 9,636 9,636 9,636ChemicalConsumption(%ofFuelCost)0.0% 0.0% 0.0% 0.0%ScrubberParasiticLoads(%ofFuelCost)2.0% 2.0% 2.0% 2.0%DistillateCalorieCorrection(%ofFuelCost)4.0% 4.0% 4.0% 4.0%HFOProcessandHeating(%ofFuelCost)0.8% 0.8% 0.8% 0.8%OperatingEngineer(Today)(USD/Annual)$219,000 $292,000 $365,000 $400,000OperatingEngineer(%ofPosition)37.5% 50.0% 62.5% 100.0%M&REquipment(%EquipCost/Annual)3.0% 4.0% 5.0% 8.0%Variables‐UncertainFuelDifferential(Today)(USD/MT)$255.50 $255.50 $255.50 $255.50Fuel/ChemicalEscalationRate(%‐AnnualforOpPeriod)8.0% 8.0% 8.0% 8.0%PersonnelInflationRate(%‐AnnualforOpPeriod)3.0% 3.0% 3.0% 3.0%EquipmentInflationRate(%‐AnnualforOpPeriod)3.3% 3.3% 3.3% 3.3%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐ExpensesSummarySheet58of77TheGlostenAssociatesFile10047.01,12January2011AnalysisResults‐Overview(Nearest$1,000)CapitalCost(USD‐YearZeroDollars)(6,034,000) (8,868,000) (10,660,000) (12,410,000)Expenses‐YearOne(USD‐YearOneDollars)(450,000) (623,000) (801,000) (1,254,000)FuelSavings‐YearOne(USD‐YearOneDollars)3,350,000 3,350,000 3,350,000 3,350,000NetPresentValue(USD‐PresentDollars)18,593,000 14,562,000 11,532,000 6,645,000InternalRateofReturn(%)55% 36% 28% 20%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐ExpensesSummarySheet59of77TheGlostenAssociatesFile10047.01,12January2011ExpensesLowYear012345CapitalCost‐Total(6,034,323)Equipment(4,183,240)Acquisition(1,851,084)Expenses‐Total(449,838) (475,110) (502,064) (530,825) (561,524)DistillateCorrection(133,980) (144,699) (156,275) (168,777) (182,279)HFOProcess&Heating(26,796) (28,940) (31,255) (33,755) (36,456)OperatingEngineer(92,432) (95,205) (98,062) (101,003) (104,033)ChemicalConsumption00000ScrubberLoads(66,990) (72,349) (78,137) (84,388) (91,139)M&REquip&Labor(129,639) (133,917) (138,336) (142,901) (147,617)Savings‐FuelDifferential 3,349,508 3,617,469 3,906,867 4,219,416 4,556,969NPV&IRRCashFlow(6,034,323)2,899,671 3,142,359 3,404,802 3,688,591 3,995,445DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(6,034,323)2,636,064 2,596,991 2,558,078 2,519,357 2,480,857NetPresentValue(atYear0) 18,593,214InternalRateofReturn 55.06%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐ExpensesDetailsSheet60of77TheGlostenAssociatesFile10047.01,12January2011ExpensesLowCapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValue(atYear0)InternalRateofReturnYear6 7 8 9 10(594,306) (629,326) (666,750) (706,759) (749,545)(196,861) (212,610) (229,619) (247,988) (267,827)(39,372) (42,522) (45,924) (49,598) (53,565)(107,154) (110,369) (113,680) (117,091) (120,603)00000(98,431) (106,305) (114,809) (123,994) (133,914)(152,488) (157,520) (162,718) (168,088) (173,635)4,921,527 5,315,249 5,740,469 6,199,706 6,695,6834,327,220 4,685,923 5,073,718 5,492,948 5,946,1380.5645 0.5132 0.4665 0.4241 0.38552,442,603 2,404,619 2,366,927 2,329,546 2,292,494ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐ExpensesDetailsSheet61of77TheGlostenAssociatesFile10047.01,12January2011ExpensesPredictedYear012345CapitalCost‐Total(8,868,468)Equipment(5,577,653)Acquisition(3,290,815)Expenses‐Total(622,559) (653,316) (685,929) (720,528) (757,252)DistillateCorrection(133,980) (144,699) (156,275) (168,777) (182,279)HFOProcess&Heating(26,796) (28,940) (31,255) (33,755) (36,456)OperatingEngineer(164,324) (169,254) (174,332) (179,562) (184,948)ChemicalConsumption00000ScrubberLoads(66,990) (72,349) (78,137) (84,388) (91,139)M&REquip&Labor(230,469) (238,074) (245,931) (254,046) (262,430)Savings‐FuelDifferential 3,349,508 3,617,469 3,906,867 4,219,416 4,556,969NPV&IRRCashFlow(8,868,468)2,726,949 2,964,153 3,220,937 3,498,888 3,799,717DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(8,868,468)2,479,044 2,449,713 2,419,938 2,389,787 2,359,325NetPresentValue 14,562,028InternalRateofReturn 36.17%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐ExpensesDetailsSheet62of77TheGlostenAssociatesFile10047.01,12January2011ExpensesPredictedCapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(796,251) (837,685) (881,727) (928,564) (978,397)(196,861) (212,610) (229,619) (247,988) (267,827)(39,372) (42,522) (45,924) (49,598) (53,565)(190,497) (196,212) (202,098) (208,161) (214,406)00000(98,431) (106,305) (114,809) (123,994) (133,914)(271,090) (280,036) (289,277) (298,823) (308,684)4,921,527 5,315,249 5,740,469 6,199,706 6,695,6834,125,276 4,477,564 4,858,742 5,271,142 5,717,2860.5645 0.5132 0.4665 0.4241 0.38552,328,611 2,297,698 2,266,639 2,235,479 2,204,261ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐ExpensesDetailsSheet63of77TheGlostenAssociatesFile10047.01,12January2011ExpensesHighYear012345CapitalCost‐Total(10,660,289)Equipment(6,135,418)Acquisition(4,524,871)Expenses‐Total(801,418) (837,799) (876,215) (916,799) (959,697)DistillateCorrection(133,980) (144,699) (156,275) (168,777) (182,279)HFOProcess&Heating(26,796) (28,940) (31,255) (33,755) (36,456)OperatingEngineer(256,757) (264,459) (272,393) (280,565) (288,982)ChemicalConsumption00000ScrubberLoads(66,990) (72,349) (78,137) (84,388) (91,139)M&REquip&Labor(316,894) (327,352) (338,154) (349,314) (360,841)Savings‐FuelDifferential 3,349,508 3,617,469 3,906,867 4,219,416 4,556,969NPV&IRRCashFlow(10,660,289)2,548,091 2,779,670 3,030,652 3,302,617 3,597,272DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(10,660,289)2,316,446 2,297,248 2,276,974 2,255,732 2,233,623NetPresentValue 11,532,079InternalRateofReturn 28.15%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐ExpensesDetailsSheet64of77TheGlostenAssociatesFile10047.01,12January2011ExpensesHighCapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(1,005,064) (1,053,067) (1,103,886) (1,157,714) (1,214,757)(196,861) (212,610) (229,619) (247,988) (267,827)(39,372) (42,522) (45,924) (49,598) (53,565)(297,651) (306,581) (315,778) (325,252) (335,009)00000(98,431) (106,305) (114,809) (123,994) (133,914)(372,749) (385,049) (397,756) (410,882) (424,441)4,921,527 5,315,249 5,740,469 6,199,706 6,695,6833,916,463 4,262,182 4,636,583 5,041,993 5,480,9260.5645 0.5132 0.4665 0.4241 0.38552,210,741 2,187,173 2,163,000 2,138,297 2,113,134ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐ExpensesDetailsSheet65of77TheGlostenAssociatesFile10047.01,12January2011ExpensesV.HighYear012345CapitalCost‐Total(12,410,278)Equipment(6,972,066)Acquisition(5,438,212)Expenses‐Total(1,254,142) (1,304,883) (1,358,114) (1,413,985) (1,472,656)DistillateCorrection(133,980) (144,699) (156,275) (168,777) (182,279)HFOProcess&Heating(26,796) (28,940) (31,255) (33,755) (36,456)OperatingEngineer(450,204) (463,710) (477,621) (491,950) (506,708)ChemicalConsumption00000ScrubberLoads(66,990) (72,349) (78,137) (84,388) (91,139)M&REquip&Labor(576,172) (595,185) (614,826) (635,116) (656,074)Savings‐FuelDifferential 3,349,508 3,617,469 3,906,867 4,219,416 4,556,969NPV&IRRCashFlow(12,410,278)2,095,367 2,312,586 2,548,752 2,805,430 3,084,313DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(12,410,278)1,904,879 1,911,228 1,914,915 1,916,147 1,915,116NetPresentValue 6,644,910InternalRateofReturn 19.56%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐ExpensesDetailsSheet66of77TheGlostenAssociatesFile10047.01,12January2011ExpensesV.HighCapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(1,534,298) (1,599,093) (1,667,238) (1,738,942) (1,814,431)(196,861) (212,610) (229,619) (247,988) (267,827)(39,372) (42,522) (45,924) (49,598) (53,565)(521,909) (537,567) (553,694) (570,304) (587,413)00000(98,431) (106,305) (114,809) (123,994) (133,914)(677,725) (700,090) (723,193) (747,058) (771,711)4,921,527 5,315,249 5,740,469 6,199,706 6,695,6833,387,229 3,716,156 4,073,231 4,460,764 4,881,2520.5645 0.5132 0.4665 0.4241 0.38551,912,002 1,906,975 1,900,192 1,891,799 1,881,934ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐ExpensesDetailsSheet67of77TheGlostenAssociatesFile10047.01,12January2011Ship/RoutePairContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundContainershipAlaskatoPugetSoundScrubberType OpenLoop OpenLoop OpenLoop OpenLoopSensitivityAnalysis ExpensesLow Predicted High V.HighCombinationofVariablesFuel/CPI‐PPI 11/5 8/3 5/2 2/1VARIABLES‐CONTROLLEDInvestmentTermsLifeCycle(#ofYears)10 10 10 10AnalysisDate(Today)(Year)2011 2011 2011 2011ScrubberInstallationDate(Year)2014 2014 2014 2014DiscountRate(%)10.0% 10.0% 10.0% 10.0%CapitalExpenseforScrubberEquipment(Today)(USD/OneTime)$3,795,000 $5,060,000 $5,566,000 $6,325,000Engineering/Design(%EquipCost)5.0% 7.0% 9.0% 11.0%Training/Documents(%EquipCost)2.0% 2.0% 2.0% 2.0%Install/Commission(%EquipCost)40.0% 50.0% 60.0% 65.0%OperatingExpense‐AnnualECAFuelConsumption(MT/Annual)9,636 9,636 9,636 9,636ChemicalConsumption(%ofFuelCost)0.0% 0.0% 0.0% 0.0%ScrubberParasiticLoads(%ofFuelCost)2.0% 2.0% 2.0% 2.0%DistillateCalorieCorrection(%ofFuelCost)4.0% 4.0% 4.0% 4.0%HFOProcessandHeating(%ofFuelCost)0.8% 0.8% 0.8% 0.8%OperatingEngineer(Today)(USD/Annual)$200,000 $292,000 $350,000 $400,000OperatingEngineer(%ofPosition)25.0% 50.0% 75.0% 100.0%M&REquipment(%EquipCost/Annual)2.0% 4.0% 6.0% 8.0%Variables‐UncertainFuelDifferential(Today)(USD/MT)$255.50 $255.50 $255.50 $255.50Fuel/ChemicalEscalationRate(%‐AnnualforOpPeriod)11.0% 8.0% 5.0% 2.0%PersonnelInflationRate(%‐AnnualforOpPeriod)5.0% 3.0% 2.0% 1.0%EquipmentInflationRate(%‐AnnualforOpPeriod)5.0% 3.3% 2.0% 1.0%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐CombinationSummarySheet68of77TheGlostenAssociatesFile10047.01,12January2011AnalysisResults‐Overview(Nearest$1,000)CapitalCost(USD‐YearZeroDollars)(6,458,000) (8,868,000) (10,100,000) (12,405,000)Expenses‐YearOne(USD‐YearOneDollars)(407,000) (623,000) (849,000) (1,124,000)FuelSavings‐YearOne(USD‐YearOneDollars)3,737,000 3,350,000 2,993,000 2,665,000NetPresentValue(USD‐PresentDollars)25,397,000 14,562,000 6,372,000 (1,964,000)InternalRateofReturn(%)62% 36% 22% 6%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐CombinationSummarySheet69of77TheGlostenAssociatesFile10047.01,12January2011ExpensesLowYearFuel/CPI‐PPI11/5012345CapitalCost‐Total(6,457,985)Equipment(4,393,187)Acquisition(2,064,798)Expenses‐Total(407,180) (442,788) (481,854) (524,735) (571,826)DistillateCorrection(149,499) (165,944) (184,198) (204,459) (226,950)HFOProcess&Heating(29,900) (33,189) (36,840) (40,892) (45,390)OperatingEngineer(60,775) (63,814) (67,005) (70,355) (73,873)ChemicalConsumption00000ScrubberLoads(74,749) (82,972) (92,099) (102,230) (113,475)M&REquip&Labor(92,257) (96,870) (101,713) (106,799) (112,139)Savings‐FuelDifferential 3,737,472 4,148,594 4,604,939 5,111,483 5,673,746NPV&IRRCashFlow(6,457,985)3,330,292 3,705,806 4,123,085 4,586,748 5,101,919DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(6,457,985)3,027,538 3,062,649 3,097,735 3,132,811 3,167,891NetPresentValue(atYear0) 25,397,427InternalRateofReturn 61.59%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐CombinationDetailsSheet70of77TheGlostenAssociatesFile10047.01,12January2011ExpensesLowFuel/CPI‐PPI11/5CapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValue(atYear0)InternalRateofReturnYear6 7 8 9 10(623,567) (680,440) (742,984) (811,792) (887,523)(251,914) (279,625) (310,384) (344,526) (382,424)(50,383) (55,925) (62,077) (68,905) (76,485)(77,566) (81,445) (85,517) (89,793) (94,282)00000(125,957) (139,812) (155,192) (172,263) (191,212)(117,746) (123,633) (129,815) (136,305) (143,121)6,297,858 6,990,622 7,759,591 8,613,146 9,560,5925,674,291 6,310,182 7,016,607 7,801,353 8,673,0680.5645 0.5132 0.4665 0.4241 0.38553,202,990 3,238,121 3,273,299 3,308,535 3,343,843ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐CombinationDetailsSheet71of77TheGlostenAssociatesFile10047.01,12January2011ExpensesPredictedYearFuel/CPI‐PPI8/3012345CapitalCost‐Total(8,868,468)Equipment(5,577,653)Acquisition(3,290,815)Expenses‐Total(622,559) (653,316) (685,929) (720,528) (757,252)DistillateCorrection(133,980) (144,699) (156,275) (168,777) (182,279)HFOProcess&Heating(26,796) (28,940) (31,255) (33,755) (36,456)OperatingEngineer(164,324) (169,254) (174,332) (179,562) (184,948)ChemicalConsumption00000ScrubberLoads(66,990) (72,349) (78,137) (84,388) (91,139)M&REquip&Labor(230,469) (238,074) (245,931) (254,046) (262,430)Savings‐FuelDifferential 3,349,508 3,617,469 3,906,867 4,219,416 4,556,969NPV&IRRCashFlow(8,868,468)2,726,949 2,964,153 3,220,937 3,498,888 3,799,717DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(8,868,468)2,479,044 2,449,713 2,419,938 2,389,787 2,359,325NetPresentValue 14,562,028InternalRateofReturn 36.17%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐CombinationDetailsSheet72of77TheGlostenAssociatesFile10047.01,12January2011ExpensesPredictedFuel/CPI‐PPI8/3CapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(796,251) (837,685) (881,727) (928,564) (978,397)(196,861) (212,610) (229,619) (247,988) (267,827)(39,372) (42,522) (45,924) (49,598) (53,565)(190,497) (196,212) (202,098) (208,161) (214,406)00000(98,431) (106,305) (114,809) (123,994) (133,914)(271,090) (280,036) (289,277) (298,823) (308,684)4,921,527 5,315,249 5,740,469 6,199,706 6,695,6834,125,276 4,477,564 4,858,742 5,271,142 5,717,2860.5645 0.5132 0.4665 0.4241 0.38552,328,611 2,297,698 2,266,639 2,235,479 2,204,261ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐CombinationDetailsSheet73of77TheGlostenAssociatesFile10047.01,12January2011ExpensesHighYearFuel/CPI‐PPI5/2012345CapitalCost‐Total(10,100,429)Equipment(5,906,684)Acquisition(4,193,745)Expenses‐Total(849,122) (872,209) (896,063) (920,715) (946,196)DistillateCorrection(119,703) (125,688) (131,972) (138,571) (145,499)HFOProcess&Heating(23,941) (25,138) (26,394) (27,714) (29,100)OperatingEngineer(284,138) (289,821) (295,618) (301,530) (307,561)ChemicalConsumption00000ScrubberLoads(59,851) (62,844) (65,986) (69,285) (72,750)M&REquip&Labor(361,489) (368,719) (376,093) (383,615) (391,287)Savings‐FuelDifferential 2,992,563 3,142,191 3,299,300 3,464,265 3,637,479NPV&IRRCashFlow(10,100,429)2,143,441 2,269,982 2,403,237 2,543,550 2,691,282DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(10,100,429)1,948,583 1,876,018 1,805,588 1,737,279 1,671,074NetPresentValue 6,372,232InternalRateofReturn 21.88%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐CombinationDetailsSheet74of77TheGlostenAssociatesFile10047.01,12January2011ExpensesHighFuel/CPI‐PPI5/2CapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(972,541) (999,783) (1,027,960) (1,057,109) (1,087,271)(152,774) (160,413) (168,433) (176,855) (185,698)(30,555) (32,083) (33,687) (35,371) (37,140)(313,712) (319,986) (326,386) (332,913) (339,572)00000(76,387) (80,206) (84,217) (88,428) (92,849)(399,113) (407,095) (415,237) (423,542) (432,013)3,819,352 4,010,320 4,210,836 4,421,378 4,642,4472,846,812 3,010,537 3,182,876 3,364,269 3,555,1760.5645 0.5132 0.4665 0.4241 0.38551,606,951 1,544,881 1,484,835 1,426,778 1,370,674ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐CombinationDetailsSheet75of77TheGlostenAssociatesFile10047.01,12January2011ExpensesV.HighYearFuel/CPI‐PPI2/1012345CapitalCost‐Total(12,404,968)Equipment(7,321,978)Acquisition(5,082,990)Expenses‐Total(1,124,003) (1,137,055) (1,150,274) (1,163,662) (1,177,222)DistillateCorrection(106,597) (108,729) (110,904) (113,122) (115,384)HFOProcess&Heating(21,319) (21,746) (22,181) (22,624) (23,077)OperatingEngineer(416,242) (420,404) (424,608) (428,854) (433,143)ChemicalConsumption00000ScrubberLoads(53,299) (54,365) (55,452) (56,561) (57,692)M&REquip&Labor(526,546) (531,811) (537,129) (542,500) (547,925)Savings‐FuelDifferential 2,664,936 2,718,234 2,772,599 2,828,051 2,884,612NPV&IRRCashFlow(12,404,968)1,540,933 1,581,179 1,622,325 1,664,389 1,707,390DiscountFactor 1.0000 0.9091 0.8264 0.7513 0.6830 0.6209PresentValue(12,404,968)1,400,848 1,306,760 1,218,877 1,136,800 1,060,155NetPresentValue(1,963,698)InternalRateofReturn 6.32%ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐CombinationDetailsSheet76of77TheGlostenAssociatesFile10047.01,12January2011ExpensesV.HighFuel/CPI‐PPI2/1CapitalCost‐TotalEquipmentAcquisitionExpenses‐TotalDistillateCorrectionHFOProcess&HeatingOperatingEngineerChemicalConsumptionScrubberLoadsM&REquip&LaborSavings‐FuelDifferentialNPV&IRRCashFlowDiscountFactorPresentValueNetPresentValueInternalRateofReturnYear6 7 8 9 10(1,190,956) (1,204,866) (1,218,955) (1,233,226) (1,247,682)(117,692) (120,046) (122,447) (124,896) (127,394)(23,538) (24,009) (24,489) (24,979) (25,479)(437,474) (441,849) (446,267) (450,730) (455,237)00000(58,846) (60,023) (61,223) (62,448) (63,697)(553,405) (558,939) (564,528) (570,173) (575,875)2,942,304 3,001,150 3,061,173 3,122,397 3,184,8451,751,349 1,796,285 1,842,218 1,889,170 1,937,1630.5645 0.5132 0.4665 0.4241 0.3855988,591 921,778 859,408 801,193 746,860ExhaustGasCleaningSystemsOperatorsGuideLifeCycleCost‐CombinationDetailsSheet77of77TheGlostenAssociatesFile10047.01,12January2011