The blending mandate will only be applicable to bunkers sold to the domestic maritime market, including ships operating between Norwegian ports, rigs and fishing vessels, a source tells ENGINE.
Prices and Road Fuel Rules
Initially proposed at 4% and later increased to 6%, Norway’s upcoming biofuel blending mandate will comprise a 94% gasoil and 6% marine biofuel blend, mainly sourced from hydrogenated vegetable oil (HVO).
LSMGO prices for domestic vessels in Bergen and other Norwegian ports are expected to surge by nearly $70/mt upon implementation in October.
Norway’s road fuels mandate has seen fluctuations over the years, with the current requirement at 17%, including a minimum 12.5% for advanced biofuels.
“About half of biofuels consumed in Norway are qualified as ‘advanced biofuels’, meaning that they are produced from residues and waste (particularly used oils for biodiesel, mainly imported),” the International Energy Agency’s (IEA) biofuel division said about biofuels in Norway in 2021.
MHService Raises Red Flags
The energy firm has also expressed concerns about possible fraudulent activity in biofuel blending, arguing it is hard to confirm whether a biofuel blend is actually produced using renewable feedstock.
“It is hardly easy to tell the difference between well-used frying oil and new vegetable oil with a bit of used mixed in, and this is just one example of the crime that is being facilitated here,” MHService said.
While the mandate will not be applicable for bunkers sold to ocean-going vessels, it will hit domestic fishing vessels, making bunkering expensive for them.
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Source: Engine
