costs are the most significant barriers for the uptake of OPS. A recent evaluation
paper of the European Commission on the Energy Taxation Directive (ETD) identified the problematic situation on OPS and recognised that ‘the ETD does not
provide for EU-wide preferential tax treatment of shore-side electricity and as a
result, shore-side electricity is disadvantaged compared to onboard generation’.
Currently, electricity produced from the combustion of marine fuel on board of
ships is tax exempt. However, when ships at berth connect with the shoreside
electricity system, they are obliged to pay the energy tax applied to electricity. A
limited number of EU Member States such as Sweden, Germany, Denmark and
Spain have applied for and have been provided a temporary permit by the EU to
apply a reduced rate of taxation to shoreside electricity for ships. This tax exemption
has a time limit though and is obtained through a long administrative process at EU
level. Taking into consideration these challenges, the Energy Taxation Directive
should be reviewed to provide a permanent EU-wide tax exemption for OPS in order
to be on equal terms with electricity generated onboard of the vessel which enjoys a
tax exemption.
ESPO surveyed ports that currently provide OPS and found that levies applied to
the electricity price are another significant barrier. Interestingly, in some cases the
price differential remains high even after a tax exemption is provided by the EU, due
to other national levies applied to the electricity price. In addition, technical challenges such as the frequency difference and additional investments for connection
with the grid often prevent the uptake of OPS. In principle, ocean-going ships are
60 Hz equipped, and ports need to invest in frequency and high-voltage converters to
address the frequency difference between the electricity from the grid (50 Hz) and
the ship’s equipment (60 Hz). Electricity shortage at city or regional level may be an
additional barrier.
However, it has to be noted that investments in shoreside electricity remain highrisk investments since there is no guarantee or requirements whatsoever for the use
of the available installations once provided. EU funding or co-funding of these
investments by the users could contribute to sharing this risk. Policy measures on
the port side such as the mandate for OPS under the Alternative Fuels Infrastructure
Directive should be accompanied by corresponding measures for the port users.
Table 11.6 shows that the availability of LNG bunkering in the port sector
continues to increase. This is a positive sign for the implementation of the Alternative Fuels Infrastructure Directive with regard to the provision by TEN-T core
network ports of LNG bunkering facilities by 2025. Currently, one third of the
ports offer this service to ships. This represents an increase of 10% since 2016.
Interestingly, LNG is mainly provided by trucks (90%) and by barges (20%). Only
13% of the ports that provide LNG bunkering facilities have opted for non-mobile
installation. It should be noted that some ports opt for more than one type of
bunkering facilities while 24% of the ports mentioned the existence of ongoing
projects to install LNG bunkering. This indicator was only added in 2018; hence,
there is no data for the previous years.
194
V. Alexandropoulou et al.
paper of the European Commission on the Energy Taxation Directive (ETD) identified the problematic situation on OPS and recognised that ‘the ETD does not
provide for EU-wide preferential tax treatment of shore-side electricity and as a
result, shore-side electricity is disadvantaged compared to onboard generation’.
Currently, electricity produced from the combustion of marine fuel on board of
ships is tax exempt. However, when ships at berth connect with the shoreside
electricity system, they are obliged to pay the energy tax applied to electricity. A
limited number of EU Member States such as Sweden, Germany, Denmark and
Spain have applied for and have been provided a temporary permit by the EU to
apply a reduced rate of taxation to shoreside electricity for ships. This tax exemption
has a time limit though and is obtained through a long administrative process at EU
level. Taking into consideration these challenges, the Energy Taxation Directive
should be reviewed to provide a permanent EU-wide tax exemption for OPS in order
to be on equal terms with electricity generated onboard of the vessel which enjoys a
tax exemption.
ESPO surveyed ports that currently provide OPS and found that levies applied to
the electricity price are another significant barrier. Interestingly, in some cases the
price differential remains high even after a tax exemption is provided by the EU, due
to other national levies applied to the electricity price. In addition, technical challenges such as the frequency difference and additional investments for connection
with the grid often prevent the uptake of OPS. In principle, ocean-going ships are
60 Hz equipped, and ports need to invest in frequency and high-voltage converters to
address the frequency difference between the electricity from the grid (50 Hz) and
the ship’s equipment (60 Hz). Electricity shortage at city or regional level may be an
additional barrier.
However, it has to be noted that investments in shoreside electricity remain highrisk investments since there is no guarantee or requirements whatsoever for the use
of the available installations once provided. EU funding or co-funding of these
investments by the users could contribute to sharing this risk. Policy measures on
the port side such as the mandate for OPS under the Alternative Fuels Infrastructure
Directive should be accompanied by corresponding measures for the port users.
Table 11.6 shows that the availability of LNG bunkering in the port sector
continues to increase. This is a positive sign for the implementation of the Alternative Fuels Infrastructure Directive with regard to the provision by TEN-T core
network ports of LNG bunkering facilities by 2025. Currently, one third of the
ports offer this service to ships. This represents an increase of 10% since 2016.
Interestingly, LNG is mainly provided by trucks (90%) and by barges (20%). Only
13% of the ports that provide LNG bunkering facilities have opted for non-mobile
installation. It should be noted that some ports opt for more than one type of
bunkering facilities while 24% of the ports mentioned the existence of ongoing
projects to install LNG bunkering. This indicator was only added in 2018; hence,
there is no data for the previous years.
194
V. Alexandropoulou et al.