Ensuring tax subsidies for environmental enhancements
Case study overview
Clients also come to us for advice, guidance and action when they are concerned over their potential tax subsidy position.
One of our corporate clients told us that they were struggling to previously bunker the correct specification of Marine Urea and believed their SCR provider had made the specifications too strict.
Their vessel had called into a European port whilst being deployed on oil exploration work and received an SCR system from a Korean engine provider. Whilst the vessel contractually obligated to use Marine Urea®, they nevertheless wanted to ensure that they benefited from the environmental subsidies available as a result.
However, the engine manufacturer’s stance was such that the ship should not take on board Marine Urea®. This provided our client with a compliance issue – it would result in a breach of contract and not receiving the tax subsidies from running on environmentally-friendly technology (the SCR System).
ECOUREA was commissioned to resolve the situation.
We liaised with both the engine manufacturer and the SCR provider. We secured and analysed the SCR catalyst information and the design substrates. Our technical team determined the SCR system’s tolerance thresholds in relation to different types and grade of 40% Marine Urea.
Working alongside our sub-contract marine insurer, we investigated the tax subsidy position further. We established that by means of developing an insurance policy and warranty for the ship, we would be able to cover the receipt of the Marine Urea and make sure the vessel stayed compliant throughout its oil exploration contract – thus realising the tax subsidies it was due.
ECOUREA further followed the matter up with the engine manufacturer to help it alter and improve its product specification in line with industry best practice.