CII Ratings & Their Impact on the Shipping Industry
Investing in Energy Saving Devices Can Improve Your Vessel's Resale Value
If you're a vessel owner, you may be familiar with the 'wait-and-see' mentality when it comes to energy saving devices.
However, recent studies have shown that this approach can actually have a negative impact on your vessel's resale value over time.
Your vessel's CII rating - a measure of its carbon emissions - is becoming increasingly important to buyers. Vessels with a CII rating of 'A' typically have a 7% higher resale value compared to vessels with a CII rating of 'E', which have a resale value of minus 12% on average.
By investing in energy saving devices, you can directly improve your vessel's CII rating and increase its resale value. Even if you're not planning to sell your vessel in the near future, it's worth considering the long-term benefits of adopting a more sustainable approach.
Even if your vessel is currently listed for sale, there's no need to wait before taking action to improve its performance and value. At Njord, we offer products that can actually help facilitate the sale of your vessel by showcasing its potential.
We've worked with many owners who, rather than neglecting their vessel because it's on the market, have partnered with us to design solutions that enhance its performance and efficiency.
These solutions can then be presented as a valuable asset to potential buyers and even incorporated into the memorandum of understanding to demonstrate the vessel's worth.
Determine your CII rating potential and payback time. Take a minute and complete a free online technology screening here!
At Njord, we offer a range of energy saving devices that can help improve your vessel's performance and efficiency. Our team can work with you to design a solution that fits your needs and helps you achieve your goals that balances economic growth with environmental responsibility.
CII Ratings & Their Impact on Charter Rates
As shipping intensifies its focus on sustainability and emission reductions, vessel owners are finding that having a higher Carbon Intensity Indicator (CII) rating is becoming an increasingly sought-after advantage when competing for vessel deployments.
Optimizing your CII score can be key to help you secure competitive business opportunities!
Conversations with ship owners considering a new time charter or time charter extension reveal that despite ongoing debates about the applicability of CII ratings, these ratings are discussed and may influence negotiations of the rates for the vessel.
Improving a vessel's CII rating can be challenging. It requires both voyage and vessel optimisation, and potentially even a consideration to deploy novel technologies that are economically feasible and effective.
Leveraging the strengths of different technologies is a tricky endeavor, as we must carefully consider how they will interact and whether their impact on one another is complementary or contradictory, as it can be difficult to determine how these technologies will work together.
Determine your CII rating potential and payback time. Take a minute and complete a free online technology screening here!
Njord's holistic approach and products facilitate communication between vessel owners and charterers, resulting in the discovery and realization of vessels' CII optimisation potential. This leads to a higher possibility of vessels being considered for TC, to improvements in charter rates, and/or the possibility of charter extensions.
CII & Three Common Misbeliefs
Many owners say "wait and see" when it comes to energy-saving devices because they don't think there are any penalties or financial benefits. But this approach can be risky.
By waiting until regulations become more strict, you may end up waiting too long. There's already evidence to suggest that lead times for certain devices are quickly increasing. This means that it could take up to a year or more to deploy ESDs on your vessel if you wait too long.
Waiting until the last minute can be dangerous when it comes to project timelines and deploying ESDs on your vessel. ESDs have a quick payoff time of around a year and a half, so deploying them now is a smart business move.
You'll start reaping the benefits in just a year or two when the investments are paid off, resulting in a better CII rating or consumption profile for your vessel.
It's crucial to start taking action on energy saving measures now - not simply wait and see what happens. After 2024, the EU ETS will take effect, putting a price tag on emissions that can't be ignored. This means even more financial incentive for vessels to go green – both in terms of competing with other charters as well resale value down the line.
Another common myth we come across is that it's pointless to kickstart your energy saving device journey until your vessel goes into dry dock in the next two or three years.
However, we always focus on what can be done during operation without dry docking.
Surprisingly, more than 90% of the technologies we use can be implemented during operation. We understand it can be complex, but it's definitely achievable.
Don't wait and see, take action on what can be deployed now and reap the financial rewards sooner.
Our products
Our comprehensive analysis evaluates potential energy-saving devices (ESDs) for your vessel, considering over 30 advanced technologies. We factor in operational profiles, regulation compliance, fuel economy, cost implications, and investment returns, delivering a customised, holistic solution for fuel efficiency enhancement.
Our detailed approach includes thorough savings analysis, effectiveness assessment of individual technologies, and comprehensive commercial project valuations. We provide strategic supplier recommendations and timelines, culminating in a ready-to-implement project plan, tailored to your specific needs.
Our comprehensive service for ESD installations, whether in-port or at drydock. Our streamlined coordination, competitive equipment pricing, and reduced lead times ensure a hassle-free experience. With us as your single point of contact, shipowners receive an efficient, end-to-end solution, maximising their investment returns.
Our service includes detailed analysis of ESDs, matched to your vessel's specific operational needs from over 30 cutting-edge technologies. We track the impact on regulations, monitor fuel savings, and evaluate total costs and ROI, ensuring ongoing optimisation and enhancement of your fleet's performance.
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