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Finnlines said on Wednesday that its new initiative, the Energy Efficiency and Emission Reduction Investment Programme (EEERI), is expected to improve efficiency and lower bunker costs as the company looks to continue to optimize its capital expenditure (capex).

The development comes as Finnlines' EUR 100 million Environmental Technology Investment Programme (ETI) - which has included the installation of exhaust gas scrubbers, investments in propulsion and reblading, and silicone anti-fouling - comes to an end this month.

In a statement, Emanuele Grimaldi, president and CEO, said: "We have completed successfully our EUR 1 billion Capex Programme in 2006-2016, targeted towards the fleet renewal, and our EUR 100 million Environmental Investment Programme will be completed in May. Today, we have a safe and reliable fleet which is modern and environmentally very sustainable. The superb result improvement during these past four years has brought Finnlines Group's financial and operational performance to an all-time high and is based on those past investments and, also on our ability to quickly respond to the changes in the market.

Looking towards the future, Grimaldi remarked: "Right after we have completed these major capex programmes, we are already looking beyond the horizon and at the growth opportunities. Therefore, we have started a new capex programme, the Energy Efficiency and Emission Reduction Investment Programme, where we will lengthen our existing ro-ro vessels. This investment programme will provide us with increased capacity and increased cargo flexibility in order to serve our customers even better and meet their growing demand for top quality cargo service."

As previously reported by Bunker Index, Finnlines launched the second phase of its ETI programme in 2015, which covered scrubber orders for its remaining ro-ro vessels and a further three of its ro-pax vessels. Moreover, additional energy efficiency investment was initiated by extending the propulsion upgrading programme. The second of the three ro-pax vessels to be rebladed and equipped with scrubbers, MS Finnfellow, started her scrubber system commissioning in February 2017. The third and last ro-pax vessel to be rebladed and equipped with scrubbers, MS Finneagle, started her retrofit at the end of March 2017, and is due to be ready and commissioned in the second quarter 2017.

The installation of scrubbers helped Finnlines control rising fuel prices last year via the use of cheaper heavy fuel oil (HFO). The ferry operator saw its bunker expenses fall by $21.21 million, or 28.1 percent, to $54.15 million in 2016 despite recording a 2.9 percent rise in consumption to 310,662 tonnes.

With Finnlines' new EEERI initiative, the objective is to drive profitable growth by increasing vessel capacity and improving efficiency by utilizing bigger transport units.

"This investment is expected to provide greater efficiency and better fuel economy," the Finnish firm said on Wednesday.

On March 31, Finnlines signed an agreement with Remontowa S.A. shipyard in Poland to lengthen four of its Breeze series vessels, with an option of two additional vessels. The close to 30 percent capacity increase is expected to considerably reduce the energy consumption per transported unit compared to the original vessel.

Results

In its results for the first quarter, released on May 17, Finnlines posted a net result of EUR 11.2 million - up $2.9 million, or 34.9 percent, on last year's figure of $8.3 million.

Revenue for the period increased by EUR 15.2 million, or 14.9 percent, to EUR 120.9 million.

"The Finnlines Group's first three months have proved, again, to be very strong," CEO Grimaldi said.