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Configuration flag CFGEnableFuelNeutralCOA enables the fixing of a Benchmark Estimate into a Fuel-Neutral Cargo COA.

A Fuel-Neutral Cargo COA can be used by owners and charterers who want to see more granular fuel costs in their contracts, and therefore be more transparent about their profit margins. In a Fuel-Neutral COA, all bunker prices are transferred to the charterer. Fuel costs are estimated for each fuel type and shows them as Extra Freight Terms in the contract, to give the charterer a clearer picture of the costs in the voyage. These estimated costs are the rate components for each fuel type. If bunker prices change, these rate components are adjusted accordingly using Unpriced Components.

Creating a Fuel-Neutral Cargo COA

Fuel-Neutral Cargo COAs must be created from Benchmark Estimates.

To create a Fuel-Neutral Cargo COA, do the following:

Enable Configuration Flags

Enable configuration flag CFGEnableFuelNeutralCOA. When enabled:
- The following fields appear in the Voyage Estimate Cargoes grid:
  - Fixed Percentage: The percentage of base freight rate or lumpsum that is not subject to CPI adjustment.
  - Base CPI: Base Consumer Price Index value used by the Estimate.
- A new menu option, Auto Calculate Fuel/Variable Base Freight appears on the Voyage Estimate menu and is selected by default for any new Benchmark Estimate. This option must be selected to create Fuel-Neutral Cargo COAs.
- Two columns are added to the Fuel/Lube Types form: ExtFrtTerm(F) and ExtFrtTerm(L). Using these columns, you can link Extra Freight Terms with their corresponding fuel types. An Extra Freight Term cannot be linked to more than one Fuel Type.
- Two fields are added to the Cargo COA: Reference Ballast Port and Reference Reposition Port. These fields are populated from the Voyage Estimate when the Fuel-Neutral COA is created.
Enable configuration flags for the freight-based Extra Freight Term:
- If using a Variable Rate component, enable CFGVariableBaseRateComponent and specify the value of the flag as the corresponding code of a Rate type Extra Freight Term from the Extra Freight Terms form.
- If using a Variable Lumpsum component, enable CFGVariableBaseLumpsumComponent and specify the value as the corresponding code of a Lumpsum type Extra Freight Term from the Extra Freight Terms form.

Set Up Extra Freight Terms

On the Extra Freight Terms form, create lines for each Fuel Type you will use in the voyage.
1. Create one line per Fuel Type for lumpsum and for rate.
2. Create a line for freight-based variable lumpsum and variable rate.
On the Fuel/Lube Types form, link these Extra Freight Terms via the Code of their corresponding Fuel Types in the ExtFrtTerm(F) and ExtFrtTerm(L) columns.

Create the Estimate

Create a Benchmark Voyage Estimate. The Estimate must have only one Cargo.
On the Benchmark Estimate toolbar, click and then click Fix Fuel Neutral Cargo COA.
A COA is created based on information entered in the Benchmark Estimate.
- Extra Freight Terms for freight and bunker costs are populated on the COA Pricing tab.
- Unpriced Components are created for each Extra Freight Term. To view and edit them, click .
  - One Unpriced Component is created per Fuel Type to account for bunker price changes.
  - One Unpriced Component for variable base freight escalation is created for the Variable Base Component Extra Freight Term.

Breakdown of Freight Calculation

If the COA Freight Type is F, the Freight Rate is broken down into the following components:

There are two components to the calculation of the freight:
- Base Freight can be broken down into two parts:
  - Fixed Base Freight: The Frt Rate specified in the Voyage Estimate Cargoes grid.
  - Variable Base Freight: The Fixed Base Freight (The Frt Rate on the Voyage Estimate Cargoes grid) * [(100 - Fixed %) / Fixed %]. For example, if you enter a Frt Rate of 25 and a fixed percentage of 25, the resulting Variable portion of the Base Freight would be 25 * [(100 - 25) / 25] = 75. The Variable Base Freight will appear as an Extra Freight Term defined by configuration flag CFGVariableBaseRateComponent.
- Fuel Component: The Fuel Component of each Fuel Type = Estimated cost of the fuel type / Cargo CP Quantity. The Fuel Component of each Fuel Type is an Extra Freight Term as specified on the Fuel/Lube Types form.

If Freight Type is L, Freight Lumpsum is broken down into the following components:

There are two components to the calculation of the freight:
- Base Freight can be broken down into two parts:
  - Fixed Base Freight: The Lumpsum amount specified in the Voyage Estimate Cargoes grid.
  - Variable Base Freight: The Fixed Base Freight (The Lumpsum amount on the Voyage Estimate Cargoes grid) * [(100 - Fixed %) / Fixed %]. For example, if you enter a Lumpsum of 25000 and a fixed percentage of 25, the resulting Variable portion of the Base Freight would be 25 * [(100 - 25) / 25000] = 75000. The Variable Base Freight will appear as an Extra Freight Term defined by configuration flag CFGVariableBaseLumpsumComponent.
- Fuel Component: The Fuel Component of each Fuel Type = Estimated cost of the fuel type (the value in the Bunker Expenses field in the Voyage Estimate P&L Summary). The Fuel Component of each Fuel Type is an Extra Freight Term as specified on the Fuel/Lube Types form.

Related Configuration Flags

CFGEnableFuelNeutralCOA	Enables the Fuel-Neutral COA functionality.
CFGVariableBaseRateComponent	Extra Freight Term of type Rate.
CFGVariableBaseLumpsumComponent	Extra Freight Term of type Lumpsum.

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