International regulations, fuel saving measures and increased efficiency demands are key drivers in today’s shipping industry. Owners, operators and designers are often left guessing what measures will help address their unique circumstances and the unintended consequences that may be caused by necessary tradeoffs.
Techno-economic models developed by ABS provide decision support on operational aspects, technical management, equipment selection and strategic business planning. These comprehensive sensitivity studies are used to assist with project evaluations and provide benefits from efficiency options with a transparent understanding of expected savings and potential tradeoffs. ABS techno-economic models are tailored to the vessel’s technical specification. In association with the client’s investment and operational strategies, these models simulate a range of scenarios and combinations of operating conditions under various economic outlook assumptions.
The ABS techno-economic evaluation service is based on a stage gate approach to support the decision-making process. It is performed in three stages of increasing model accuracy confidence level:
The models utilize the Life Cycle Cost Analysis (LCCA) approach based on the recognized methodology of the National Institute of Standards and Technology (NIST) Handbook 135 Life-Cycle Costing Manual. The LCCA approach, also known as the Total Cost of Ownership (TCO) methodology, can be leveraged not only toward more efficient operations and lower fuel costs but to negotiate higher charter rates and increase an asset’s resale value.
Technology options are evaluated to assess the operational efficiency and competitiveness of newbuild, or existing vessels as new designs enter service. The life cycle approach provides a clear evaluation of the cost differentials through a comprehensive inventory of all relevant project and operational costs in present value terms. Newbuild and retrofit technology decisions can be simulated for a single vessel or a series of vessels using a range of plausible regulatory compliance requirements scenarios. The simulation outcomes are evaluated based on project finance criteria such as discounted payback period, saving-to-investment ratio, net savings and other key performance indicators.
Examples of ABS techno-economic evaluations include:
The ABS team is multi-disciplinary, with extensive experience in ship hydrodynamics, numerical modeling, model testing, full scale measurements, design, ship management and operations and regulatory compliance. ABS can provide detailed and in depth recommendations supported by extensive experience, advanced tools and knowledge to help owners and operators meet their operational and regulatory needs.