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Verifying Compliance with Ballast Water Discharge Regulations
155
primarily with the cost savings of not using or maintaining a BWTS that has already been
installed. However, there may also be other significant economic benefits associated with
not using a BWTS, even if it has been installed. For example, if verification of compliance
involves only onboard inspections of the BWTS, there may be benefits in having a pristine
or slightly used BWTS that will easily pass inspection rather than a heavily used BWTS
that may be fouled or degraded and more likely to fail inspection and result in penalties or
delays.
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Cost of Noncompliance
The expected costs of not complying with ballast water regulations will depend on the level
and effectiveness of enforcement. Based on conventional deterrence models, these costs
can be measured by examining an enforcement chain that includes: (1) the probability of a
ballast water discharge violation being detected, (2) the probability of a detected violation
resulting in a citation, (3) the probability of a citation being successfully prosecuted, and
(4) the size of the expected penalty.
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Equation 1 presents an overview of a “deterrence model” that can be used to assess and
compare alternatives for enforcing ballast water regulations based on these four factors.
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Information is currently lacking to completely characterize and compare potential enforce-
ment systems for ballast water regulations on the basis of all of the parameters included in
Equation 1. However, it is not too early to begin comparing the measurement, reporting,
and verification (MRV) systems that are under consideration that will determine the value
of one critical parameter in Equation 1: (
a
), the probability that ballast water that does not
meet standards will be detected. This single parameter is important for two reasons. First,
it has an enormous influence on the expected cost of noncompliance and, therefore, has
a significant effect on compliance rates. Second, it is, by itself, a useful measure of the
overall confidence that can be placed in the verification program in particular and in the
effectiveness of ballast water regulations in general.
Equation 1: Economic deterrence model applied to ballast water regulations[0]
Noncompliance with U.S. ballast water regulations involves discharging ballast water into
U.S. waters that does not meet U.S. discharge standards. Assessing enforcement deterrence
in this case involves comparing the expected benefits and expected costs of noncompliance
under various enforcement regimes, where
Expected Cost
=
C
=
a
×
b
×
c
×
d
×
e
where
a
=
probability that a discharge violation will be detected
b
=
probability of a detection resulting in a citation
c
=
probability of a cited violation being prosecuted and resulting in a penalty
d
=
average assessed or schedule - based penalty for a violation
e
=
average “final settlement” amount expressed as the % of the average “assessed
or schedule-based penalty” the shipowner or ship operator expects to pay.
Expected Benefits
=
B
=
cost savings of not properly installing, operating, and maintaining
a certified BWTS.
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