Time-Charterers will be responsible for meeting the CII

With the Carbon Intensity Indicator (CII) due to come into effect in about two months from now, BIMCO has recently published a clause based on the premise that a time charterer should bear the responsibility for a ship’s emissions ‘because the charterer makes the relevant decisions on the operation of the ship.’

Introducing the new clause, when entering into a charter party or updating an existing one, parties should agree on a specific CII to be achieved each year.

And now that ship emissions play a vital role in meeting the charter party, which are directly impacted by the fuel consumed, the question is how time charterers make sure the emission data is accurate, and secondly how to reduce these emissions.

Technical Efficiency

But operational efficiency is only half of the full story while shipowners remain responsible for the technical performance of the ship.

CII is a result of the technical and operative performance of the vessel and therefore the responsibility cannot be only with the charterer.

Failure to accurately monitor and report both operational as technical efficiency may result in nasty claims between shipowners and charterers over the root cause of  bad CII’s and charterers will need to respond to these claims.

Emission planning and reporting will become key

In an earlier blog post, we discussed the quality issues with noon reports. However, most time charterers rely entirely and solely on noon-reports for CII and performance reporting.

Noon-reports are seen as a fact of life in shipping, and have been around for ages. But there are three main issues when using them.

First, using noon reports only is insufficient to benchmark and explain ship performance. For example, is very difficult, if not impossible, to compare vessels and voyages due to differences in weather, draft and speed.

Secondly, with data points only once every 24 hours, they are not sufficient to produce a proper vessel performance analysis. Working with manually reported averages over a 24 hour period is just not good enough.

Third, there is a lot of room for human errors and inconsistencies. Several respondents explained that sudden increases in bunker consumption were easily blamed on bad weather, with no good way to check if this indeed was the cause.

Now that the CII ratings will be derived directly from noon-reported consumption data, we have to realise that using manually reported data only is just not good enough anymore.

It's time to move on to a new way of monitoring.

Preparation is key

In 2023, charterers will need to prepare to reliably monitor and benchmark vessel consumption and emissions.

It will be essential to check the reported consumption. What is the actual performance of your fleet against the planned performance? Can a high consumption be explained by the weather? Or are there other root causes? Or is the bad rating a result of technical efficiency issues like main engine problems, or hull fouling?

We do this benchmarking using a Digital Twin, a model with the capabilities to compare actual performance of vessels against a benchmark - in real-time.

This helps you to identify underperforming vessels, and notice wrong reporting. We will tell you which vessels need attention and have the highest deviation; helping you to focus.

Using a Digital Twin, We4Sea helps charterers by collecting unbiased benchmark data, aimed to reduce fuel consumption and emissions and -as of 2023- make sure you meet the targets on CII.

Start today

Do you like to learn more, and start preparing today?

Contact us for a (web) meeting, a brainstorm session or a live demo.