Banks, ESG tensions and environmental regulatory developments
Just days after the inconclusive IMO MEPC 76 meetings, decarbonization considerations were incorporated into many discussions throughout the first day of the event. “Ultimately, it will be the regulations that will set the timetable for the industry as a whole,” commented Hamish Norton, president of Star Bulk Carriers.
A pillar of the New York maritime calendar, Marine Money is largely virtual this year. In line with reopens and removals of many Covid restrictions in the United States, it included scaled-down in-person events for local sponsors.
There have been some insightful views on how developments towards ESG might impact the financing of shipping. Norton said, “Debt capital markets will be more inclined to promote sustainability than equity capital markets… to the extent that you get more lenders and debt providers looking at sustainability, it can lead to more sustainability. the sector to use less debt and more equity. “
Norton also identified another theme bubbling beneath the surface over several sessions – the tension between the sustainability concerns of capital providers and the timing of regulatory developments, suggesting that while these concerns are mounting faster than the regulatory environment, ” this could lead maritime assets to move out of state-owned enterprises into private enterprises. ”He was quick to add that he hoped that didn’t happen.
Panel member Jerry Kalogiratos, CEO of Capital Product Partners, took a different take on this tension, speaking of industry-wide experimentation with new fuels and technologies, saying: regulation to be more global… and accelerate the solutions we need to have better visibility on our investments. If this means a carbon tax that will finance research and development, the needs had to be met yesterday. “
Hugo De Stoop, CEO of Euronav, spoke of the consequences of MEPC 76: “I think we will see regional regulation resurface… because they no longer trust IMO as a central regulator. After highlighting the European Union’s plans to tax carbon emissions from shipping, he said, “But that won’t be the only one … it looks like the United States and even the Chinese are interested in a such program.
Panel member Anthony Gurnee, CEO of tanker owner Ardmore Shipping, reflecting on IMO developments, said: “I think this will result in a more fragmented and, quite frankly, chaotic approach on the regulatory side. “
De Stoop summed up the concerns succinctly, saying: “Whether or not the shipment is included in the [emissions trading] patterns don’t really depend on us, and that’s the problem. We no longer have control of our destiny.
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