Cruise lines hope to sink US-Canada pollution plan

* Proposal would create buffer zone around U.S., Canada

* Cruise executives say boundaries are too broad

* Fuel costs seen rising 40 percent

MIAMI, March 21 (Reuters) - Cruise companies are balking at a proposal to create a low-emissions buffer zone around the United States and Canada, saying it sets arbitrary boundaries based on faulty science that overstates the health benefits.

The proposed Emissions Control Area would extend 200 nautical miles, which is 230 statute miles (370 km), around the coast of the two nations and set stringent new limits on air pollution from ocean-going ships beginning in 2015.

The International Maritime Organization (IMO), the U.N. agency that sets regulations for ships operating internationally, is expected to adopt the proposal at its weeklong meeting that begins on Monday in London.

Cruise executives at an industry meeting in Miami said the plan would force them to switch to low-sulfur fuels that would dramatically drive up costs.

“Our estimate is that in today’s market it’s probably 40 percent more expensive,” said Michael Crye, executive vice president of technical and regulatory affairs for the Cruise Lines International Association, known as CLIA.

It “essentially means all the current fuel that we burn cannot be burned within 200 miles,” Stein Kruse, chief executive of Holland America Line, told the Cruise Shipping Miami conference.

Proponents, including the U.S. Environmental Protection Agency, say the plan would clear the air around polluted port cities and save up to 8,300 lives a year in the United States and Canada. It would limit emissions of sulfur oxides, nitrogen oxides and particulate matter, pollutants that are linked to asthma and cancer.

The Environmental Defense Fund activist group cheered the plan, saying “the dangerous air pollution from these floating smokestacks is a serious health threat to tens of millions of Americans who live and work in port cities.”

But cruise executives say there is no reason to extend the boundary that far out to sea because the pollutants do not travel even a quarter of that distance, and that a more precisely tailored boundary would suffice.

They said the IMO research ignored the effects of prevailing winds, which push emissions ashore in some problem areas such as California, but push them away in other areas.

"Putting it out to 200 miles is completely arbitrary," said Kruse, whose line is part of Carnival Corp CCL.N. "The reality is that the problem exists in a few very, very large cities."


The plan would require ships in the buffer zone to use fuel with a sulfur content of no more than 0.1 percent, compared with 2.5 percent in the fuel most ships now use, Crye said.

The IMO has already agreed to set the standard at 0.5 percent worldwide as of 2020, he said. Cruise officials contend the health benefits of the proposal were overstated because the IMO compared the proposed sulfur limits against current ones rather than against those already set to take effect in 2020.

Cruise ships comprise about 12 percent of the world’s 46,000 commercial ships, according to the U.S. Congressional Research Service. They use the same type of fuel as freighters and tankers. Their impact can be large since they visit the same ports repeatedly.

Cruise executives say they want to be good environmental stewards and they support fair and logical regulation.

They say they have cleaned up their act, installing better wastewater treatment systems and adopting comprehensive recycling programs, following a few highly publicized prosecutions in the 1990s for dumping trash at sea and discharging oily bilge water.

They say their ships have been designed to be more fuel-efficient than older models and that they have voluntarily switched to using land-based power sources in some ports, rather than running their engines when docked in cities where air quality is poor.

They are also testing exhaust gas scrubbers similar to those used by many electric utilities on shore, CLIA said.

But industry officials feel they are being unfairly singled out. Some pulled ships out of Alaska after it levied hefty taxes and adopted pollution controls they viewed as excessive.

“The cruise ships are being held to a higher standard than any facility shoreside in Alaska,” Kruse said. “We cannot even take on fresh water in some ports in Alaska because ... it has a higher copper content than what Alaska allows us to discharge in Alaska. That’s how crazy it’s gotten.”

Cruise executives see the buffer zone as another example of overzealous regulation that threatens their industry.

“Some days you get up and you feel that new regulatory efforts are coming from almost every direction, from every government from every part of the world ... and that does propose a lot of issues for the industry,” Carnival Cruise Line Chief Executive Gerald Cahill said.

Editing by Eric Beech