People often think of the EU as a land mass: continental Europe – but the EU has 68 000 km of coastline. Four Member States have no road link to mainland Europe, and another eighteen have coastlines, usually with offshore islands. Linking these are the EU’s “Motorways of the Sea”: key shipping routes between countries and along coastlines. However, while there has been continuous progress in reducing the levels of pollution generated by road vehicles, the shipping industry has moved more slowly. This is partly because of its international nature, and partly because fuel can represent 50% of operating costs. Heavy oil is cheap, but it is also high in sulphur and is a notorious source of SO2, particulates, and NO2.

Alternatives to heavy oil do exist, and include liquefied natural gas (LNG), which is the chosen fuel for Brittany Ferries’ newest ship. Breton farming co-operatives originally set up the company in 1972, to make it easier to export their produce. Now it has grown to become an international ferry brand, linking Brittany with the UK, Ireland and Spain. The new ship should enter into service in 2019 and will normally run between Caen in France and Portsmouth in the UK. Although there is a cost premium for the LNG, the company has entered into a long-term supply agreement with its energy provider to keep the extra cost as low as possible.

The Bank’s financial contribution will be 28% of the project cost, with the balance coming from the company’s own resources and a consortium of established financial institutions. In view of the project’s important contribution to EU environmental and transport policies, the project was eligible under the European Commission’s CEF. However, having piloted the use of EU support for lower impact fuels, future operations of this type would be supported by the new EFSI Green Shipping Guarantee Scheme.