ROI & Savings — Cruise & Marine

A generator is a capital purchase that replaces a recurring cost, and at sea that recurring cost carries freight, agency handling, stowage and a logistics chain tied to port calls. This page builds the case the way a vessel operator’s finance team will want to see it — per ship, then multiplied across the fleet.

A real fleet analysis

We have a worked example rather than a hypothetical one. An EcoloxTech E-300 fleetwide savings analysis prepared for Norwegian Cruise Line looked at what onsite generation replaces per vessel and across the fleet. The full deployment story — what it replaced, what it cost and the trade an operator makes in exchange — is in the Norwegian Cruise Line case study.

The method behind those numbers, and the general model, is on ROI and savings. What makes the vessel case unusual is not the arithmetic — it is that the consumable being replaced carries a logistics tail that shoreside buyers do not pay.

What to count per ship

What to count with a generator

• One-off: the system, installation (usually drydock or scheduled works), feed-water treatment, holding tank, pumps, distribution to galleys and housekeeping lockers, commissioning and crew training.
• Ongoing: food-grade salt, water, electricity, replacement filters, service parts, and test strips or photometer reagents.

Two lines are specific to ships. Distribution is harder than ashore — runs are long, vertical and through fire zones — and it is the item most often under-estimated. And installation is scheduled around the vessel’s docking plan, which means the project timeline is set by the yard period rather than by procurement.

The model

Three numbers per ship: A, the annual cost today that the generator replaces, including freight, handling and labour; B, the annual running cost with the generator; C, the one-off cost. Annual saving is A − B, payback is C ÷ (A − B), and the fleet figure is that saving multiplied by hulls, adjusted for class differences.

Two cautions on the fleet multiplication. Sister ships are rarely identical after a decade of refits, so survey a representative hull per class rather than assuming. And a fleet-wide programme is delivered over several docking cycles, so the cash-flow model should be staged rather than presented as a single switch-on.

Stowage and logistics, valued properly

On a ship, space is revenue. A chemical store is managed, segregated, ventilated space that cannot hold provisions, stores or anything that earns. Releasing it has a real value that a shoreside model would treat as soft — and unlike ashore, the ship cannot simply build more.

The logistics tail is equally real: bunkering schedules tied to port calls and agents, price variation between ports, customs and hazardous-goods paperwork, and the risk that a missed call leaves the ship short. Generating aboard removes the tail rather than shortening it.

Outbreak avoidance, honestly stated

The number that usually ends the discussion is not the chemical saving; it is the cost of one reportable outbreak. A voyage that crosses the 3% threshold brings investigation and response, itinerary and operational disruption, terminal cleaning, guest compensation and a public score.

We will not claim that onsite generation prevents outbreaks, and nobody honest should. What it does is remove one specific failure mode — the enhanced cleaning protocol being limited by what is in the store on day nine of a fourteen-day itinerary. Put a conservative figure on how often supply has constrained your response in the last two years, and carry it in the business case as a separate, clearly-labelled line rather than folding it into the savings.

The fleet multiplier that is not money

Standardisation is worth more on ships than almost anywhere else, because crews rotate between hulls and inspections are unannounced. One set of procedures, one log format, one training package and one set point regime across sister ships means a housekeeper transferring hulls already knows the programme, and an inspector finds the same answers on every vessel in the class. That is hard to price and easy to feel.

Building the business case

1. Twelve months of ship’s account by product, across all ports, for a representative hull per class.
2. Agency and freight charges per delivery, separated from product cost.
3. Consumption on a clean voyage versus an event voyage.
4. Stowage area currently committed, and what it would otherwise hold.
5. Crew time on receiving, stock control and dilution, per port call.
6. Space, power, water and drainage available, and the docking plan.
7. Distribution route to galleys, buffets and housekeeping lockers.
8. Protocols and products that must stay as they are.

The free sanitation audit assembles this into a written model and sizes the system, and says so when a generator is not the right answer for a particular hull.

Three other shapes

Not every operator is a large cruise line with its own docking plan. Three other patterns come up regularly, and the case looks different in each.

The single expedition or small cruise vessel. Perhaps 150 guests, remote itineraries and resupply measured in weeks. The chemical saving alone may be modest, but the endurance argument is at its strongest here: the ship cannot restock mid-itinerary at any price. Size for the longest leg and the escalated protocol, and expect the case to rest on self-sufficiency rather than on cost.

The ferry operator. Short routes, frequent port calls, very high passenger turnover and short turnarounds. Resupply is easy, so endurance is not the argument; speed, stowage on a vessel with little of it, and the sheer frequency of turnaround cleaning are. Run the model on turnaround volume rather than on voyage length.

The mixed fleet. Several classes, different itineraries, some under VSP and some not. Here the honest answer is usually partial: the long-itinerary and high-complement hulls justify systems first, and the group benefit comes from standardising procedures and training across all of them. Modelling every hull identically is the commonest error in a fleet business case.

Where the saving shows up

Finance teams reasonably ask which line moves. Chemical spend falls on the ship’s account. Agency and freight charges fall with it, often by more than expected, since each delivery carried handling as well as product. Salt, water, electricity and service appear as new, smaller lines, with salt usually the smallest surprise of the three. Crew labour does not fall as headcount; it shows up as hours returned to cleaning rounds that were being compressed at the end of a voyage. Stowage is a soft saving until the space is needed, at which point it is very real. Outbreak-related costs are the hardest to attribute and the largest when they land, which is why they belong as a separate labelled line rather than folded into the savings.

Frequently asked questions