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less than one in two ships comply with the annual efficiency ratio (AER)
- less than 50% of the sample was in compliance in 2020, with containerships the worst offenders
Less than one in two ships comply with the annual efficiency ratio created by the Poseidon Principles says an article on Splash247.
Annual efficiency ratio calculations
UK consultants Maritime Strategies International (MSI) has added annual efficiency ratio (AER) calculations used in the Poseidon Principles to its Horizon platform showing that as of last year less than one in two ships was in compliance with the matrices developed by the green ship financing initiative.
Less than 50% of the sample was in compliance in 2020, with containerships the worst offenders, analysis by MSI shows.
Trajectory
The trajectory is moving quickly and will have an enormous impact on the ability of banks to meet their portfolio alignment goals unless action is taken swiftly. In the same dry bulk example, whilst around 50% of the ships between 30,000 and 40,000 dwt had AER values in 2020 below the trajectory, all else being equal this share would drop to just 22% in 2025.
“The ramifications of these findings are potentially far-reaching, skewing the provision of finance in favor of some vessel types, knocking on to decisions in the S&P markets, around newbuilding finance and shipyard preference for vessel contracts,” commented Will Fray, a director, at MSI. “A key plank of the principles is that they will adapt over time but the MSI analysis demonstrates this need is pressing.”
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Source: Splash247
