Study on Emission Control of Berthing Vessels-Based on Non-Cooperative Game Theory

Abstract

To accomplish IMO’s emission reduction targets, the Chinese government has established emission control areas and implemented strict sulfur limitation policies. Faced with a downturn in the shipping industry and the challenge of an insufficient supply of compliant fuel, Hong Kong and Shenzhen in China have implemented different low-sulfur fuel oil subsidy policies. It is particularly important to study non-cooperative games between two ports considering low-sulfur fuel oil subsidies. In this paper, first, non-cooperative game models considering low-sulfur fuel oil subsidies are constructed. Second, the mechanisms of various factors affecting port pricing, throughput and profit are analyzed. Then, a case study is conducted using AIS data of container ships in Shanghai and Ningbo-Zhoushan ports. The study reveals that in both sequential and simultaneous games, the gross tonnage of a ship has an impact on the optimal service price, throughput and profit of the port. The subsidy rate has a positive impact on the profitability of the port itself, to the detriment of competitor ports. In conclusion, a low-sulfur fuel oil subsidy policy has a significant positive impact on the step-by-step implementation of more stringent air pollution reduction policies in port waters.