Optimizing Sulfur Emission Control Areas for Shipping

Abstract

The design of emission control areas (ECAs), including ECA width and sulfur limits, plays a central role in reducing sulfur emissions from shipping. To promote sustainable shipping, we investigate an ECA design problem that considers the response of liner shipping companies to ECA designs. We propose a mathematical programming model from the regulator’s perspective to optimize the ECA width and sulfur limit, with the aim of minimizing the total sulfur emissions. Embedded within this regulator’s model, we develop an internal model from the shipping liner’s perspective to determine the detoured voyage, sailing speed, and cargo transport volume with the aim of maximizing the liner’s profit. Then, we develop a tailored hybrid algorithm to solve the proposed models based on the variable neighborhood search meta-heuristic and a proposition. We validate the effectiveness of the proposed methodology through extensive numerical experiments and conduct sensitivity analyses to investigate the effect of important ECA design parameters on the final performance. The proposed methodology is then extended to incorporate heterogeneous settings for sulfur limits, which can help regulators to improve ECA design in the future. Funding: This work was supported by the National Natural Science Foundation of China [Grants 72025103, 71831008, 72201163, 72071173, 72371221, 72394360, 72394362, 72361137001 and HKSAR RGC TRS T32-707/22-N]. Supplemental Material: The online appendix is available at https://doi.org/10.1287/trsc.2023.0278 .