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Climate and Sustainable Finance - Is the tide turning towards greener shipping
13 February 2020Dalibor GogicRahul Kapoor
Undoubtedly, IMO 2020 implementation will be in focus for the
shipping industry this year. The fuel specification change is one
of the most profound changes that the shipping industry has been
faced with for quite some time. The majority of the shipping market
has been quite upbeat about the consequences of IMO 2020, as fleet
supply contraction influenced by scrubber retrofitting in some
shipping markets, potential removal of fleets with high compliance
cost and potential intensification of slow steaming due to
anticipated high cost of VLSFO, is expected to further tighten
fleet supply.
We should also bear in mind that IMO 2020 is only one of the
environmental issues that shipping is facing, and that curbing CO2
footprint is one of those long-term items that will stay on the
agenda for the time being. Cost of compliance for the fleets is
likely to only increase in the next decade or so, with already a
high burden of compliance cost for the upcoming years, bearing in
mind fleets have to comply both to the new fuel specification rules
but also the ballast water treatment convention as well.
