Estimating socio-economic impact from ship emissions at the Port of Incheon

Abstract

Ports create harmful effects on their adjacent population because ships discharge noxious gases like SOX, NOX, and particulate matter (PM). To tackle this problem, some ports started to control emission through regulations such as Emission Control Areas (ECA) and Reduced Speed Zone (RSZ). This paper estimates the social cost of ship emission and eco-efficiency at the Port of Incheon (POI). We further examine how the ECA and RSZ designation can reduce the social cost. The estimation is based on the activity-based approach, where ship type, engine, and movement are used to measure fuel consumption and then emission. Results suggest that the social cost of ship emission at the POI amounts to $90,805,478. The eco-efficiency of the POI, compared to the one at the Port of Las Palmas in another study, is substantially better. Under RSZ, the corresponding emission abatement values are $4,485,308, $2,642,009 and $21,932,435 from SO2, NOX and PM reduction, respectively. If 1.0% and 0.1% sulfur fuel are used complying with rules of the ECA, the social cost savings amount to $8,174,947 and $12,868,842 from SO2 reduction.