|
|
|
For the economic evaluation,
role of fuel use and costs is presented for the participating Member States for
a number of relevant fleet segments, using active as well as passive gears. Each
country chapter is composed of five analytical sections:
1. Role of energy for individual fleet segments
2. Break-even analysis
3. Factors determining energy efficiency
4. Economic potential for technological improvement
5. Scenarios for future outlook
These sections are followed by a list of recent studies in relation to fuel costs
in fisheries.
Role of energy for individual fleet
segments
This section presents an overview of the average situation in the years
2004-2006. A three-year average was selected to present a more ‘structural’ picture
and avoid coincidental fluctuations of one single year. Furthermore, consistent
economic data is available. Data on 2007 will only be available by the end of 2008
or beginning 2009. The tables show the technical parameters for the whole segment
as well as averages per vessel. Graphics show the development of each segment for
the past 10 years (depending on availability). Finally, a figure is included showing
the development of the fuel price since 2000.
Break-even analysis
Break-even analysis shows situations where revenues are equal to costs,
or net profit is equal to zero. Such situation may be achieved by changing one of
the main indicators, in our case price of fuel, fuel costs and catch per unit of
effort, which is a measure of productivity). A simple model was constructed for
this purpose, which also accounts for subsequently possible changes in crew remuneration.
If a segment realized on average profit, the break-even fuel price will be higher
than the actual price of 2004-2006. On the other hand, if the segment was making
a loss, the fuel price would have to fall to a lower level in order to eliminate
that loss. Most importantly, the calculated break-even price can be compared to
the present fuel price (in 2007-2008) to assess whether the segment can be expected
to be making a profit or a loss, assuming that all other things remain equal (ceteris
paribus assumption). Change in fuel price will often lead to a different remuneration
of the crew, as that is related to fuel costs. The break-even fuel costs generate
in principle same results as the break-even fuel price. Evidently change in fuel
costs can be also achieved / caused by a change in fuel use, i.e. in energy efficiency
or level of effort. Finally, break-even performance can be achieved by a change
in productivity, i.e. catch per unit of effort (either in physical or in financial
term). This does not affect the fuel consumption nor fuel costs. This calculation
is relevant mainly for the later stages of the analysis when the feasibility and
constraints of technological adaptations will be analysed. E.g. adaptations of gear
to reduce fuel consumption may also affect the productivity (cpue). Comparing the
present productivity with the break-even productivity shows the margin available,
or the constraints imposed. This is again particularly relevant segments which already
faced a loss in the base line period 2004-2006.
Factors determining energy efficiency
Fuel efficiency can be defined as: Litres fuel / kg of fish and/or Fuel
costs as % of value of landings. Determining factors can be: type of gear, vessel
size (GT), engine size (kW) and possibly vessel age, engine age, assuming that age
and efficiency are related. At this moment these are only hypotheses. In order to
test these hypotheses, scatter diagrams are presented in this section to show whether
a statistical relation can be expected at all. Further statistical analysis of this
aspect will be carried out in the second phase of the project.
Economic potential for technological
improvement
The section on economic potential for technological change presents preliminary
calculations on maximum possible investments in hull or engine and on trade off
between fuel savings and productivity. Introducing technical adaptations to reduce
fuel consumption should lead to annual lower costs. However, part of these savings
may be off-set by a decrease in productivity. The maximum allowable decrease of
cpue is shown in the column ‘Trade-off with CUE’. However, if such decrease of CUE
would occur, there would be no funds available to finance the required investments.
Assuming that the productivity would remain at the original level, despite the implemented
technical adaptations, the potential savings on fuel costs could be used for investments
in the required equipment. The level of such investments depends on the savings,
the interest rate and the duration of the depreciation of the capital goods.
The
calculation presents two examples – maximum investment in hull (which would be depreciated
over 40 years) and maximum investment in engine (depreciation period 10 years).
In the later stages of the project it will be assessed whether these amounts would
be sufficient to make the required investments. The calculated amounts can be interpreted
as a value of loan which would be repaid over the given period from the savings
on fuel costs.
Scenarios for future outlook
The price of fuel may rise or fall in the future, which is unpredictable.
This section presents a scenario analysis of the consequences of changes of the
fuel prices of -15%, +10% and +25% on term of main economic indicators – gross value
added, crew share (remuneration of labour) and net profit (remuneration of capital).
The scenarios show how economically viable the segments will be should such changes
occur and should the assumed fuel price remain structurally at that level. These
scenarios are also relevant for the subsequent phase of the project. They show to
which extent the segment will be resilient to fuel price changes after the implementation
of some proposed technological adaptations. |
|