Costa, Europe’s Number One Cruise Line, is dedicated to supporting and implementing environmental protection programs that ensure sustainable tourism.

The Italian company employs an Environmental Management System developed in accordance with requirements of UNI EN ISO 14001/2004. This system was introduced to Costa’s pre-existing setting already oriented towards environmental protection, the prevention of marine pollution and the development of sustainable tourism. The pre-existing Safety Management System (SMS), which Costa introduced back in 1996, and the Environmental Compliance Plan (ECP), introduced in 2002, were both previously used to manage and control environmental aspects related to the operation of the fleet.

Costa is the only cruise fleet flying the Italian flag and therefore is the only line whose cruise ships are subject to more restrictive environmental, safety and social accountability regulations. Costa Cruises not only operates in accordance with the prevailing laws but also, where possible, seeks to preempt legislation, setting higher standards for itself and more ambitious objectives by means of internal procedures that go beyond the scope of mandatory requirements of local, national and international regulations.

The commitment to safeguarding the environment and to corporate social responsibility in general is reflected in Costa Cruises’ Sustainability Report (available online at www.costacruises.com), a purely voluntary form of reporting designed to provide comprehensive and transparent information on the effects of corporate activity on the environment and the community. The Sustainability Report has its roots in the application of the “B.E.S.T. 4” (Business Excellence Sustainable Task), an integrated management system that encompasses four types of voluntary certification of corporate compliance with the highest standards in the areas of quality (UNI EN ISO 9001, issued in 2000), environment (UNI EN ISO 14001, 2004), safety (OHSAS 18001, 1999) and social accountability (SA 8000, 2001), guaranteeing the measurement of company performance and continuous improvement. Costa obtained the B.E.S.T. 4 from RINA (the Italian Shipping Register) in 2004, becoming the first company in the world to do so.

The following are key components of Costa Cruises’ environmental excellence:
· Green Star notation assigned by RINA, certifying that all of Costa’s ships are operated in an environmentally responsible manner and help protect the air and sea in areas where they sail.
· 100% sorting for recycling of shipboard solid waste.
· A policy that places a ban on the overboard discharge of any solid waste (except food waste).
· Special waste is never discharged overboard.
· Approximately 400 m3 of aluminum and 2100 m3 of glass from Costa’s ships were sent for recycling in 2007.
· Most of the water used on the ships in the Costa fleet is produced directly on board using desalination plants.
· Discharge at sea of sewage and gray water is only at a distance greater than 12 miles from the nearest land, instead of the 4-mile limit stipulated in international regulations.
· Double bilge (oily water) separator.
· Fail-safe “white box” system enabling a further check of the oil content of effluent waste.
· Sampling and analysis of engine and diesel generator emissions.
· Sampling and analysis of incinerator emissions.
· Monitoring of electromagnetic emission levels (guest and crew areas).
· Adoption across the fleet of the Ballast Water Management Plan (compulsory only in the U.S. and Brazil).
· Regular audits carried out by independent organizations.
In addition, numerous energy and fuel-saving measures have been introduced or are being piloted on board:
· Use of ecological silicone-based coatings for the ship’s hull. These anti-fouling coatings enhance hydrodynamic performance and reduce the growth of microorganisms on the hull surface without any toxic effects.
· An awareness campaign aimed at guests and crew, designed to rationalize the consumption of electricity and water on board.
· Use of low power consumption LED light bulbs.
· Enlargement of reverse osmosis desalination plants to produce potable water on board;
· Installation of an automatic lighting control system designed to adjust the ship’s external lighting in accordance with the current sunlight intensity
· An economizer enabling the recycling of hot water produced by the engines for heating in the cabins and public areas.
· Optimization of the air conditioning system in the public areas: the airflow adjusts automatically in accordance with the presence of people in the room and the outside temperature
· Installation in the cabins of light switches operated by magnetic stripe cards.

Costa Cruises’ environmental commitment goes beyond its ships. Sorting of waste for recycling is carried out in all the Company’s Italian offices as well as in the Savona Palacrociere, the cruise terminal managed by Costa. In April 2008, the company officially commenced construction on the innovative “Palazzo Costa” project, an architectural plan to extend and redevelop the company’s headquarters in Genoa. The new offices will be a perfect blend of creativity, innovation and respect for the environment, with certain features that will be at the cutting edge of Italian architecture. For example, it will be one of the country’s first buildings with zero C02 emissions on site.

Shipboard Waste Management

Effective shipboard waste management is one of Costa Cruises’ top environmental priorities and an area in which it has concentrated substantial efforts. In 2007 the company achieved a 10% reduction in the amount of garbage (type of waste similar to urban solid waste) per person landed each day. The objective for 2008 is a further 10% reduction.

Sorting for recycling is applied to 100% of solid waste on board Costa’s ships. Garbage collection is optimized using two main methods:

· Food processing equipment, in particular an automatic system of transportation, pulping and collection of food waste.
· Special suitably labeled receptacles for the manual separate collection of other categories of garbage (e.g. plastic, paper, metal, aluminum, glass, ceramics).
· Once collected, the garbage is treated separately on board for each category, using incinerators, compactors for plastic and metal waste, and glass crushers.
· Costa Cruises’ policy places a ban on the overboard discharge of any solid waste except food waste.

In addition to garbage, there is also “special waste” (e.g. used batteries, neon lamps, photo developing fluid, etc.), which does not fall into any of the six waste categories defined in MARPOL (International Convention for the Prevention of Pollution by Ships), but is managed in compliance with Italian law (Legislative Decree no. 152 of April 3, 2006). The special waste generated on board Costa’s ships is handled using procedures and technologies allowing adequate collection, storage and subsequent disposal ashore. Costa Cruises never allows overboard discharge of special waste in any circumstances.

Arrangements for aluminum and glass recycling are made on board the liners in the Costa fleet. Approximately 400 m3 of aluminum and 2100 m3 of glass were sent for recycling in 2007. In recognition of its commitment to recycling, Costa Cruises won the CIAL (National Consortium for the Recovery and Recycling of Aluminum) “Comune Riciclone” award in 2007. The aluminum recycling program, which began in the Port of Savona, will soon be extended to other ports, both in Italy and abroad: Civitavecchia, Tianjin (China) and St. Lucia. Contractors have been chosen for the recycling of cooking oil and lead batteries in some Italian ports and in Hong Kong This activity will also be starting in the near future.

In the last few years a number of measures have been introduced to reduce the volume of waste generated. These include the use of plates and cups made of biodegradable material, the use of wooden cutlery, olive picks and cocktail stirrers instead of plastic products; sauce dispensers and jam/honey bowls have replaced sachets and plastic packaging in the buffets and in cabin bathrooms, liquid soap and shampoo dispensers have replaced throw-away plastic bottles. Steps have been taken on some ships to change systems and installations so that HCFC R22 can be replaced by more eco-friendly refrigerants.

Water Discharge Management

The international MARPOL Convention prescribes that bilge water (the bilge is the area of the ship located on the bottom of the hull where wastewater and oily waste collect together with other residues from systems and equipment in machinery spaces) must be treated in order to reduce the concentration of oil before it can be discharged overboard. On Costa’s ships, the control system for the concentration of oil in effluent water only permits overboard discharge if the oil content is less than 15 ppm; this is guaranteed by continuous monitoring. In the context of going beyond the scope of mandatory requirements, Costa Cruises has installed on all ships a fail-safe “white box” system, enabling a further check of the oil content of effluent water with a flow control device and constant recorder reading of all relevant information.

MARPOL regulations state that treated sewage (intended to mean flush water from toilets and waste iswater from medical sinks) may only be discharged at sea at a distance greater than four miles from the nearest land while the distance for untreated sewage must exceed 12 miles. Costa Cruises’ own internal regulations are stricter: sewage is only discharged at sea at a distance greater than 12 miles from the nearest land and while the ship is traveling at a speed not less than 6 knots and only after being treated by what is referred to as a Marine Sanitation Device (MSD), which is installed on all ships in the fleet.

“Gray water” – namely, drainage from bathrooms (wash basins and showers), galley (dishwashers and sinks) and laundry – may also only be discharged at sea further than 12 miles from the nearest land, which is a distance greater than that specified in the relevant international legislation.

Water Consumption

Water used on ships in the Costa fleet is only partly supplied from external sources; the majority is obtained directly on board using desalination plants for the production of potable water. The 2007 edition of Costa’s Sustainability Report documents the considerable progress that has been made in this area with an increase in the proportion of water produced directly on board from 55% in 2005 to 73% in 2007. Also, water meters have been installed fleet wide in order to improve the monitoring of water consumption on board. Finally, faucet aerators have been fitted in all the cabins of the ships in order to reduce water wastage when taps are turned on.

Management of Energy and Fuel Consumption

An important environmental aspect on which Costa Cruises is working is the greenhouse gas emissions generated by ships, mainly due to the use of fuel on board both for propulsion and for the production of electricity. One of the company’s objectives for 2008 has been to carry out a feasibility study for the reduction of fuel consumption and energy demand across the fleet. At present, a campaign of sampling and analysis is being carried out on board Costa’s liners with measurement of engine and diesel generator emissions, and monitoring of levels of electromagnetic emissions from the generation of electrical power.

In regards to the main and auxiliary engines and the boilers, all of the ships have a computerized Planned Maintenance System (PMS) aimed at optimizing the operation of machinery.

Environmental Awards and Recognition

Throughout its sixty-year history, Costa has always paid a great deal of attention to economic, cultural, social and environmental issues, constantly striving in pursuit of the right balance between development and conservation. This is highlighted by the many achievements and widespread recognition it has attained in the environmental field.

In 2005, Costa Cruises became the first company in the world to receive the “Green Star” notation across its entire fleet from RINA. This prestigious notation certifies that all of Costa’s vessels comply with environmental standards for the prevention of pollution of the marine environment and is actually more strict than the prevailing provisions of the international MARPOL Convention.

Further confirmation comes in the form of the partnership established in 2005 with the World Wildlife Federation (WWF), the world’s largest independent conservation organization, which Costa is supporting in the efforts to safeguard three of the most precious and endangered marine ecoregions on the planet – the Mediterranean Sea, the region of the Greater Antilles, and the Northesast coast of Brazil, as well as the Lampedusa turtle rescue unit.

In 2007, Costa Cruises endorsed the very first version of the voluntary “Venice Blue Flag” agreement designed to safeguard the environment and heritage of Venice. The initiative, which is promulgated by the local Municipality, Harbor Master’s Office and Port Authority, is designed to reduce air emissions. Under the terms of this major environmental undertaking, Costa Cruises, along with the other signatories to the agreement, adopts standards for all its ships calling in Venice that are stricter than the environmental compliance provisions currently in force.

For three editions in a row since 2005, the Swiss branch of the tour operator Kuoni has bestowed on Costa Cruises the Green Planet Award, which is the highest seal of eco-approval in the travel and tourism sector, for the exemplary ecological management and performance of its ships, aimed at minimizing their environmental impact.

Confirming its role as a major player in the field of environmental compliance, in 2007 Costa also entered an agreement with CIAL for the separate disposal and recycling of aluminum packaging on board its liners, a first for Italian shipping.

Elsewhere, in 2005 Costa launched a project of collaboration with the Joint Research Centre of the European Commission for monitoring climate change in the Mediterranean.

Last but not least, on April 22 this year Costa Cruises participated in “International Earth Day”, through the promotion SEED (Steiner Evergreen Earth Drive) launched by Steiner Leisure, Costa’s partner in the management of its shipboard spas. For every guest who experienced a treatment that day at one of the wellness centers on board the 12 Costa liners, Steiner Leisure planted a tree (donation of $1) in support of the “Arbor Day Foundation,” which is the world’s largest tree-planting organization.