Future-proof ships

A shipowner investing in tonnage has to consider the increasing uncertainty in the maritime industry concerning regulatory developments, technological progress, alternative fuels, and changing transport needs. This study further develops a process for a shipowner to future proof ships by preparing for changes that will affect the value and competitiveness of assets. The introduction of a multi-scenario approach will help build resilience and readiness, and provide input to a robust newbuilding strategy. 

The process consists of three steps; deciding on key performance indicators (KPIs) and scenarios in which to test the potential investment; then stress testing the design or designs in the established scenarios; and finally evaluating each design’s performance. The process is iterative; it is repeated until the result is satisfactory. 

We have conducted a case study for a very large crude carrier (VLCC), running model simulations with nine selected design combinations in 16 scenarios spanning the commercial, regulatory and technology opportunity space. The resulting ‘competition risk matrix’ provides a knowledge-based, structured and systematic best-practice approach to evaluating commercial and carbon robustness of a new ship. 

The challenge is to be robust both on financial and environmental KPIs in the short and long term. The results of the case study show that to remain competitive throughout the operating lifetime of a vessel, investing in energy efficiency is paramount. This is because a VLCC built today will compete with vessels built in five, 10, 15 years’ time, and must consider future standards to remain competitive. 

There is a significant risk that for a vessel built in 2020, the most competitive fuel in the ship’s early life will not necessarily be the same as when it is scrapped. Keeping the bridging philosophy in mind when designing a vessel, allowing for flexibility to switch to another fuel during the vessel’s operating lifetime, would be crucial in mitigating the risk of becoming a stranded asset.