Presentation
2022 Cruise Environmental Strategy Study Session Stephen P. Metruck Stephanie Jones Stebbins Executive Director Managing Director, Maritime Division Sandy Kilroy Melissa Parks Senior Director| Environment, Policy Analyst, Government Relations Sustainability & Engineering 1 Purpose for Today 2 1VISION &FOUNDATION 2ENVIRONMENTALSTRATEGY 3LEADERSHIP OPPORTUNITIES 3 1 VISION & FOUNDATION 4 _ iF nlwe 5 GRAIN BELL STREET TERMINAL CRUISE TERMINAL Terminal 86 Pier 66 SMITH COVE CRUISE TERMINAL Pier 91 Cruise Operations 1999-2022 2022 Estimate 1.3M Passengers 296 Ship Calls 7 Maritime Revenue & Cruise Cruise revenues have grown year over year Seattle has been aggressive in raising Port directed fees Supports other Maritime & Port Central Services Actuals Actuals Actuals Actuals Actuals Actuals Actuals Forecast 2014 2015 2016 2017 2018 2019 2021 2022 Cruise Revenue $12,993,430 $14,413,620 $15,421,861 $17,595,810 $18,879,880 $22,409,725 $9,517,055 $28,573,859 Expenses Directly Charged to Cruise $3,388,171 $3,530,430 $4,270,256 $4,327,393 $4,787,542 $5,340,108 $4,468,451 $7,243,847 Subclasses Net Income to Support Maritime $9,605,259 $10,883,190 $11,151,605 $13,268,417 $14,092,339 $17,069,616 $5,048,604 $21,330,012 & Port Central Services 8 Business Agreement Definitions Tariff: Terminal Tariff No. 5 Port rates, charges, rules and regulations governing dockage, passenger fees and other port directed fees. Preferential Berthing Agreement: Multi year agreements Preferential berthing rights in exchange for Minimum Annual Guarantee Ability to add other stipulations and reporting requirements. Lease: Can include unique terms, including upkeep of the property and equipment. Preferential Berthing rights and a minimum Annual Guarantee. 9 Business Agreements Norwegian Cruise Line, Holland America Line, Royal Caribbean, Celebrity Oceania Cruises, Regent Princess Cruises, Carnival Cruise Brands Cruises, Silversea Seven Seas Cruise Line, Seabourn Percent of 33% of passengers 39% of passengers 28% of revenue passengers Passengers Preferential Berthing Lease Business Agreement Tariff 15-year; expires in 2030 Agreement Type Extension options through 5-year extension option 2023 10 Regional Economic Benefit CRUISE SUPPORTS 5,500 jobs $900 million annual business revenue Tourism Equity and Community Equitable Economic Cruise Investments Job Fairs: new in 2022 Connecting local businesses with Cruise lines Suppliers Businesses around the state supply ships 11 Alaska Economic Impact "Tourism gave us the ability to transition from a timber 2020 Financial Impacts to Alaska economy to a sustainable tourism economy, allowing our community to thrive while also preserving over 7,000 acres Local Community Revenue Loss -$98.6 million of old growth forest." Wages lost State and Local -$305 million Russell Dick, President & CEO of Huna Totem Corporation Lost Revenues for Local Business -$1.1 billion Icy Strait Point, Alaska The continuation of the no sail order "will mean 2 years with no economy. Somewhere around $330 million in lost revenue for local businesses. People are already moving away. Population is down to around 800 from 1,100 last summer. Businesses will fail. A lot of them. We lost professionals in all sectors. The municipality will run out of reserves by next August, even with the stimulus funding." Andrew Cremata, Mayor, Skagway, Alaska 12 A Legacy of Cruise Environmental Innovation and Leadership Cruise agreements NWPCAS Updated updated, require EGCS wash water paused in shore power use by Puget Sound equipped ships at Terminal 91 Enhance d Cruise Cruise MOU 2016 PSEI showed At-Ber th Best NW Ports exceeded Duwamish Valley NWPCAS up dated, zero- First Northwest Manag ement NWPCAS climate Community emission vis ion Prac tices Benefits First Maritim e Climate and Cruise sho re power Port's Clean Air and air targets 4 Strategy (NWPCAS) years early Commitment First U.S . port to Air Action Pl an Adopted at Term inal 30 Resolution Passed achieve Green Port GHG ta rgets accelerated Ma rine Certifi cation 2005 2009 2015 2018 2020 2022 2004 2008 2013 2016 2019 2021 First Puget Sound North American Puget Sound No EGCS was h water Maritime Air Shore power at Cruise Exhaust Gas Terminal 91 Emission study Emissions Discharge Zone Cleaning System Inventory (PSEI) (moved from T30) Control Area In in effect* (EGCS) wash water 5-year updates Effect* Explore a green At Berth Clean banned at berth corridor Second shore Fuels Program Quiet Sound power connection Launched program launched Seattle Waterfront installed - First Clean Energy global port with 2 Strategy connections Bold* = Regulation Green = Air Quality Blue = Water Quality Maritime Environmental Leadership in North America Port of Seattle compared to GREEN MARINE-Certified West Coast Cruise Ports 5 o le e r o le e r le o e r le r e o le a t t u v g t a t g v u t t a g u v t a t u v g t a t 4 e S n c o Die Die e o c Die e o c e Die o c n e a S n S n n S n S n r a a a n Score (Out of 5) V a S a a a e S V S V S v V u o e c e e 3 g n e r a a V g g e a e r v e r r g a u e a Av r Av Av n a e o ic 2 Av a n o c a n le a n e r n a ic r e g V t t a e r ic Die ic e r S N . Am . Am n 1 N . Am S a e N N. American Average . Am 0 N N. American Average San Diego Greenhouse Gas & Spill Prevention & Community Impacts Environmental Waste Management Underwater Noise Air Pollutant Stormwater Mgmt Leadership Emissions 2021 Scores 14 The Port's Tools for Transformation PORT OF SEATTLE Emissions Leases, Direct Community Incentives & Accounting, Agreements, Investment Engagement Recognition Reporting Tariffs MARITIME INDUSTRY Innovation Partnerships Direct Investment POLICY & REGULATIONS International National State Advocacy Partnerships 15 Waterfront Guiding Principles 1. Maximize the use of the Port's deep-water facilities and industrial lands to serve maritime industrial uses. 2. Expand economic, cultural and community benefits within Cruise Operations and Development. 3. Support financial sustainability of the Port of Seattle 4. Incorporate leading edge environmental stewardship and sustainability practices and facilities that can exceed existing regulations. 5. Facilitate improved transportation mobility of people and goods in the region. 6. Provide consistent excellence in customer service to strengthen Seattle's role as the West Coast's premier cruise port. 16 2 ENVIRONMENTAL STRATEGY 17 Charting the Course To Our Future State 2020 2030 2040 2050 Today By 2030 By 2050 Build shore power Install clean energy Operate a zero-emission Improve vessel efficiency and infrastructure waterfront environmental performance Pilot novel propulsion Zero-emission cruise operations Create a Seattle Waterfront New clean maritime fuels Clean Energy Strategy Engage and advocate at local, national, and international arenas Explore a Green Corridor 18 Building Blocks for a Sustainable Cruise Industry WASTE & WATER AIR NOISE CLIMATE ENERGY QUALITY QUALITY REDUCTION Voluntary Quiet Sound Northwest Explore a Green Rigorous solid agreement to Underwater Ports Clean Air Corridor waste and prevent Noise Strategy Seattle recycling wastewater Mitigation & programs discharge Maritime Waterfront Management Clean Energy Ban on scrubber Plan Climate and Air Eliminating discharge Action Plan Strategy single-use Construction Ocean noise reduction Community Sustainable plastics Acidification and marine engagement maritime and Terminal and on- Action Plan mammal Focus on aviation fuels ship energy Stormwater best monitoring environmental International efficiency management justice engagement Efficient vessel practices design 19 Partnering to Preserve Water Quality in Puget Sound Water Quality Successes: Looking Ahead: Since 2004, cruise ships have not discharged any Continue support for the Cruise MOU, sewage into Puget Sound as part of the Cruise MOU with CLIA and Ecology 2020: the Port used its tariff to ban all cruise ships from Participate in a Puget Sound study of discharging exhaust gas cleaning system wash water EGCS water quality impacts while at berth Continue cruise at-berth best 2021: Cruise lines voluntarily agreed to pause wash management practices, training water discharges in Puget Sound while a 3rd party Continue to engage environmental studies water quality impacts stakeholders on water quality issues Currently, Seattle's cruise ships exceed regulation and do not discharge anything into Puget Sound 20 Protecting Marine Ecosystems Successes: First port to join the International Alliance for Ocean Acidification (OA) and develop an OA Action Plan Founding member of Quiet Sound to reduce underwater noise impacts to Southern Resident Killer Whales from large vessels Looking Ahead: Developing an Underwater Noise Mitigation & Management Plan 21 The Northwest Ports Clean Air Strategy Phase-out emissions from seaport-related activities by 2050, supporting cleaner air for local communities and fulfilling our shared responsibility to help limit global temperature rise to 1.5C. Shared airshed: Past Progress: 2005 to 2020: 22 Charting the Course to Zero: Port of Seattle's Maritime Climate and Air Action Plan Strategies and actions to reduce maritime GHGs 50% by 2030: Install shore power at all major cruise berths Reach 100% of homeport cruise vessels equipped with shore power Support domestic and international efforts to phase out emissions from ocean-going vessels Support continual advancements in equipment efficiency and emission reduction from vessels Near-term projects: Complete the Waterfront Clean Energy Strategy Install shore power at Pier 66 Pilot green lease terms Develop a process for ongoing engagement with near-port communities 23 Planning for Ports as Clean Energy Hubs A collaborative effort involving NWSA, Seattle City Light and the Maritime Industry Investments to facilitate Port and industry transition to zero emissions fuels and technologies Enabling infrastructure for zero-emissions terminals Work with National Labs to evaluate clean hydrogen for vessel, vehicle, equipment and utility applications and large volume storage 24 Engaging Near-Port Communities Established the Duwamish Valley Community Benefits Commitment Community feedback shaped the Port's cruise environmental priorities Partnering in the Duwamish Valley Clean Air Program Developing an ongoing engagement process on climate and clean air issues informed by near-port communities Developing community engagement playbook of best practices 25 Promoting Transparency and Accountability Complete GHG emissions inventories Port-related Maritime GHG Port of Seattle Emissions in Seattle Maritime GHG Total: annually 300,114 metric tons GHG 78,775 metric tons GHG Conduct Puget Sound Maritime Air Emissions Inventory every 5 years Recreational vessels NWSA Marine Cargo Collect cruise-specific emissions data Ships Port 35% Administration Port of Work collectively with partners to Seattle total Cruise Ships Rail Other NWSA 26% expand availability of cruise 68% Commerical Fishing Operations Vessels 13% Grain Ships environmental data Develop annual progress reports and Cargo-Handling Drayage Trucks Equipment 26% quarterly newsletters Cruise buses Engage community with regular environmental progress reports, and 17% 84% From Port of Seattle ocean-going opportunities to inform cruise GHG DPM vessels between 2005-2016 environmental strategies 26 Achieving Our Goals What it will take to get to zero by 2050: Zero- Focused effort on goals Emission Cruise Ships Cross-sector partnerships Supportive policy Zero- Community Emission Engagement Ground New funding and/or capital and Trans- Reporting portation Investments in infrastructure, research and The Greenest development Cruise Port in North Available, affordable technology America Industry commitment Zero- Energy Emission Workforce training Efficiency Cruise and Waste Terminal Reduction Community engagement and capacity building Operations Protect Water Quality and Marine Ecosystems 27 3 LEADERSHIP OPPORTUNITIES 28 Environmental Influence and Impact High Global Impact & Low Port Influence Global IMO Engagement Clydebank Declaration Regional Green Corridors Northwest Ports Clean Air Strategy National Federal Policy Federal Agency Collaboration Puget Sound Cruise MOU Emissions Inventories Port of Century Agenda Seattle Leases, Agreements, Tariffs Maritime Climate and Air Action Plan Low Global Impact & High Port Influence Engagement Opportunities POLICY PARTNERSHIP COMMUNITY Provide the ongoing Cultivate new regional, Lead the just and resources and guidance U.S. and international equitable transition to needed for the Port to partnerships focused on zero emission and accelerate the transition maritime decarbonization sustainable cruise future to a zero-emission cruise and community benefits industry in Seattle LEADERSHIP ADVOCACY Leverage the Port's Lead advocacy in domestic "Tools for Transition" to and international forums drive sustainable change for Port priorities and in the Seattle to Alaska partner with others to cruise market maximize influence 30 Clydebank Declaration SIGNATORIES Mission: "support the establishment of Australia Japan green shipping corridors zero-emission Belgium Marshall Islands maritime routes between 2 (or more) Canada Morocco portsand at least 6 green corridors by the Chile Netherlands middle of this decade, while aiming to scale Costa Rica New Zealand activity up in the following years" Denmark Norway Recognizes need for an accelerated global Fiji Palau maritime response to climate change Finland Singapore Alignment with Paris Agreement France Spain Signed at COP26 in November 2021 Germany Sweden Ireland United Kingdom Italy United States of America 31 Incentives and Recognition: Encouraging Environmental Leaders Past: At-Berth Clean Fuel incentive program (2009-2015) encouraged early transition to low sulfur diesel fuels ahead of regulation Today: Sustainable Century Awards recognize business partners for environmental performance, education and outreach, innovation, and equity, diversity, and inclusion Future: International Association of Ports and Harbors Program focused on rewarding cruise environmental performance Evaluate incentives to encourage early transition to zero-emission fuels, technology or other environmental benefits 32 Leases, Tariffs, and Agreements: Levers to Raise Environmental Standards Today: Preferential Berthing Agreement require shore power use for equipped cruise ships where a connection is available as well as weekly reporting Stormwater Best Management Practices Ban on exhaust gas cleaning system wash water discharge at berth and voluntary moratorium in Puget Sound pending further study Future: Require homeport ships to have shore power by 2030 Require transition to zero-emission equipment, vehicles and cruise ships by 2050 Partner with cruise lines on emission reporting Partner with cruise Lines on broad sustainability goals and standards for workforce development, local provisioning and other goals 33 Policy Advocacy: Advancing Environmental Goals through State, National, and International Engagement Past: Creation of the North American Emissions Control Area Passage of Clean Fuel Standard in Washington & Bipartisan Infrastructure Legislation at federal level Today: Influence Clean Fuel Standard rulemaking Advocacy for $3.5B for maritime decarbonization in Build Back Better Act or smaller reconciliation package Ongoing federal agency conversations re: partnership and funding Participate in development of international maritime policy via International Association of Ports and Harbors Engage U.S. Delegation to IMO to provide port perspectives on U.S. environmental priorities Influence global discourse via Getting to Zero Coalition and other channels. Future: Deliver an international engagement strategy Influence international and national policy decisions that support zero-emission vision Seek shared priorities with key environmental advocacy groups 34 Upcoming Events May 16-18: IAPH World Ports Conference Vancouver, British Columbia June 8 10: Green Marine's Green Tech Montreal, Quebec September 22-23: Global Maritime Forum Annual Summit, New York City October 18 20: GreenPort Cruise & Congress at Port of Zeebrugge, Belgium November 7-18: UN Climate Change 27th Conference of Parties; Sharm el-Sheikh, Egypt December 12 16: Marine Environment Protection Committee (MEPC) 79, IMO, London, England Engage with U.S. delegation ahead of session 35 Questions? 36
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