Friday, December 14, 2012

California’s Southernmost Port,
San Diego Turns 50

By Mark Edward Nero

A sometimes overlooked aspect of the Port of San Diego is also one of the reasons it has been able to sustain itself: the San Diego Bay is somewhat more diverse in usage and operation than that of the two mega ports to the north. The Port of San Diego doesn’t just have two container terminals; its jurisdiction also encompasses a three-berth cruise ship terminal and 18 public parks. The port also plays a role in military logistics and works with the US military on occasion.

The San Diego Port Authority is also relatively unique in that the port is governed by representatives from five different cities. Its seven-member Board of Port Commissioners is made up of three commissioners that are appointed by the San Diego City Council and one appointed by the city councils of the neighboring cities of Chula Vista, Coronado, Imperial Beach and National City.

And with the Port of San Diego on the verge of launching its 50th anniversary celebration this month, the facility’s CEO boasts that the facility will not only survive but thrive in the coming year and well beyond.

“The Port of San Diego has been on an aggressive campaign to grow our maritime business,” port president and CEO Wayne Darbeau told Pacific Maritime Magazine. “We’ve been doing that nationally by looking for business throughout the United States and abroad. You should look for more and more of that to occur as we continue to grow our business.”

In preparation for that growth, the port’s Board of Port Commissioners in June approved $6.2 million in capital improvement projects throughout the five Port of San Diego member cities, including pier modernization, redesign of a cruise ship terminal baggage area, aesthetic improvements and a new boat-cleaning station.

The port already has additional major development efforts underway, Darbeau said, particularly the Chula Vista Bayfront Master Plan, which would create a 556-acre waterfront development; and the and North Embarcadero Visionary Plan, which consists primarily of a set of public infrastructure improvements that would join San Diego’s downtown and bay as part of a waterfront beautification project.

The port’s stated goal with the Chula Vista project is to transform the currently underused industrial waterfront property in the city into a world-class resort and conference destination, complemented by a mix of residential and retail, as well as more than 240 acres of parks and nature preserve.

The plan received California Coastal Commission approval in August, and port officials have been conducting outreach to potential developers and investors.

“That will be an almost $1.2 billion project,” Darbeau said. “That’s a great project for the port, a great project for the city of Chula Vista.”The first phase of the North Embarcadero Visionary Plan includes a 105-foot wide esplanade, plazas, shade pavilions and seating areas. A groundbreaking for the $28.6 million, 1.2-mile project was held in January.

“Phase one is being constructed right now,” Darbeau said.

The Unified Port of San Diego was founded Dec. 18, 1962 by the California State Legislature and since then, it has grown to become California’s fourth busiest seaport, after those in Los Angeles, Long Beach and Oakland, and rests in the top third of all US ports, according to the US Bureau of Container Statistics. Its two cargo terminals – the Tenth Avenue Marine Terminal in San Diego and National City Marine Terminal – import more than three million metric tons of cargo annually.

The National City Marine Terminal (NCMT) is a 125-acre, seven-berth facility operated by Pasha Automotive, which processes several hundred thousand cars annually, including Honda, Acura, Isuzu, Volkswagen, Nissan and Mitsubishi vehicles. NCMT, which has a maximum channel depth of 35 feet, is capable of handling over half a million vehicles annually, according to the port. Lumber and other large project cargo is also handled through the terminal.

The Tenth Avenue Marine Terminal is a 96-acre multi-purpose eight-berth facility with a maximum channel depth of 43 feet. Inbound cargo includes refrigerated commodities, fertilizer, cement, break-bulk commodities and forest products. The terminal features a million square-feet of warehouse and transit sheds as well as a 300,000 square foot cold storage facility.

Its principal inbound cargoes are perishables and refrigerated commodities, fertilizer, cement, break-bulk commodities and forest products, like newsprint. Primary export cargoes include refrigerated cargo, breakbulk and bulk commodities. Terminal tenant Dole Fresh Fruit imports about 185 million bananas through the terminal monthly; the port receives about 95,000 TEUs of Dole fruit annually.

As one example of the Port of San Diego's preparation for the future, the Tenth Avenue terminal is being prepared for the use of shoreside power at its terminals. Terminal electrification is a project the port has become invested in over the past two years.

“We first implemented it on our cruise ship terminal back in November 2010,” Joel Valenzuela, the port’s maritime operations director said of shoreside power, explaining that the port launched the effort in order to stay in front of upcoming California Air Resources Board emissions regulations that take effect in January 2014. Under the new regulations, three types of vessels will be required to use shoreside power when docked: cruise ships, container ships and refrigerated cargo ships – either refrigerated containers or refrigerated break bulk.

“They use a lot of power when they’re docked, either because the cruise passengers need electricity or to keep the perishable products fresh,” Valenzuela explained.

The regulations will apply to fleets that visit California ports and meet or exceed a minimum visit threshold: 25 annual visits to a port for container-ship and refrigerated-cargo ship fleets and five annual visits to a port for passenger-ship fleets. By Jan. 1, 2014, ships that fall under the regulations must plug into shoreside power at least 50 percent of the time while at California ports. The percentage gradually increases under the Air Resources Board rules to the point where by 2020, fleet operators will be required to reduce at-berth emissions from their vessels’ auxiliary engines at California ports at least 80 percent of the time.

A study conducted less than six months after shoreside power was installed at the port’s cruise terminal found that 22 tons of pollutants and 448 tons of greenhouse gases were reduced between when the shore power system went online in November 2010 and April 16, 2011.

The results showed the approximate emission reductions from 22 cruise ship connections for the Holland America ship Oosterdam while using the shore power system. Since then, more vessels have begun plugging in while at dock. In January 2012, port tenant Flagship Cruises & Events began transitioning its 11-vessel fleet to shore power, a $2.5 million project.

“Not all the cruise ships that come have been retrofitted, but those that have been retrofitted are able to access to shore power system,” Valenzuela said. Slated next for electrification is the Tenth Avenue Marine Terminal, whose primary tenant, Dole Fresh Fruit, signed an unprecedented 24.5-year lease in August. Under the terms of the agreement, the port and Dole have agreed to work together on infrastructure improvements. The port has committed to spending about $7 million to upgrade the land-side shore power infrastructure; Dole has agreed to pay for the vessel-side improvements.

One of the challenges facing the port during its 50th anniversary is sustaining business at its cruise terminal at the B Street Pier. The facility, which is home to three cruise ship berths, peaked at 255 vessel calls with more than 921,300 passengers in 2008 before gradually falling each year since, mainly due to decreasing interest in travel to Mexico because of the country’s drug cartel wars and resulting violence.

By 2013, the number of vessel calls is expected to drop under 100, according to port data, which would be the fewest since the late 1990s.

But Darbeau said he’s confident that all areas of port operations can thrive in the coming year and eventually become more competitive with the much larger competing ports to the north, thus essentially becoming the little economic engine that could.

“We’re going to build a Pacific gateway on this side of California, south of Los Angeles and Long Beach,” he predicted. “We’re going to build a Pacific gateway from San Diego and our region and be very, very important to global trade and the region’s economic vitality and job creation and a good standard of living.”

“The future is very good for the port as we go forward,” Darbeau said, adding that the next 50 yeras would be even better than the first 50.