(6:50 p.m. EDT) -- Due to new environmental emissions regulations that are part of an agreement between Canada and the United States, costs for Canada/New England cruises may be on the rise as early as 2012, while the number of cruises offered may decline, according to the Canadian Broadcasting Corporation.
In an effort to cut sulfur emissions near Canadian and U.S. shores, America and Canada entered into an agreement through the International Maritime Organization that will require cruise ships to start using more expensive fuel as soon as 2012, Captain John McCann of the Saint John, New Brunswick Port Authority told Cruise Critic. The current fuel types allowed within 200 miles of the shore can be up to 2.5 percent sulfur. But, the new regulations would take that number down to 1.5 percent within two years and to just 0.1 percent by 2015, McCann says.
How will this impact the region and its ports in 2012?
Because the type of fuel required in 2012 is already available in Canada and is only slightly higher in price than fuels currently used, McCann explains that the real impact likely won't be felt until 2015 and adds that "right now, Canada and New England sailings are selling quite well." However, U.K.-based Fred. Olsen -- says that it will consider cutting Canada itineraries in 2012, citing increased costs associated with the new fuel. Although the company doesn't have many calls scheduled in the region, several other major lines (including Holland America, Carnival, Celebrity, Cunard, Princess, Royal Caribbean, Silversea and Norwegian Cruise Line) do.
Although most of the lines did not immediately respond to our requests for comment, Holland America spokeswoman Mary Schimmelman says the line plans "to sell and operate all scheduled cruises as currently published." Norwegian Cruise Line spokeswoman Courtney Recht tells us that NCL has not yet solidified its 2012 itineraries, so it's too soon to tell if any of its sailings will be affected; Gina Finocchiaro, a spokeswoman for Silversea, says the same.
How will this impact the region and its ports in 2015?
Just a year ago, we reported that Canada sailings were on the upswing, and a Cruise Atlantic Canada Association press release says that the cruise industry brought an estimated $80 million in revenue to the region in 2009 -- meaning that port towns stand to lose quite a bit of income if cruise lines start slashing itineraries.
McCann worries that lower-sulfur fuel, which will be required to meet the new emissions regulations by 2015, is not produced locally and is expensive to import. That extra cost will have to be absorbed by cruise lines and will likely be reflected in cruise fares charged to passengers. Alternately, cruise lines could choose to reduce the number of Canada and New England sailings, which may drive cruise fares for the region even higher on the consumer end. Either way, expect fare increases.
What are the alternatives?
McCann mentions that ships calling on Canada during transatlantic cruises will be less affected than ships sailing along the Eastern Seaboard, as they are only within the 200-mile emissions regulation radius for a short period of time and can switch to less expensive fuel at other times during the voyage. So, repositioning cruises that call on Canadian ports may be a more economical choice for those looking to book Canada sailings -- if prices do increase as a result of the new regulations, that is.
Another option, which would allow ships to meet the requirements without using the more expensive fuel, is currently in the works. But, McCann says it remains to be seen whether that technology, which would allow ships to be retrofitted with equipment to filter sulfur out before exhaust is released into the air, will be ready by 2015 and whether such retrofits will be economically feasible for cruise lines to implement.
Stay tuned for further updates as the effective dates edge closer.
--by Ashley Kosciolek, Copy Editor
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Canada/New England Environmental Regulations May Affect Cruises
July 28, 2010