Green Shipping: $1.9tn Investment Opportunity?

Credit: CHUTTERSNAP/Unsplash

If shipping-related emissions were a nation, they would be the sixth largest. From a flood of new regulations to the advantages of cleaner fuels and possibly a comeback for wind-powered freight, we have examined the dangers and prospects, as reported by Schroders.

New developments 

The shipping industry is facing new developments such as mandatory energy efficiency and carbon intensity assessments by the International Maritime Organization (IMO) and being included in the European Emissions Trading System (EU ETS) from 2024. The IMO is expected to adopt a more ambitious climate target in 2023. This presents both risks and potential investment opportunities for a decarbonizing shipping industry.

Why should investors care about green shipping?

The international shipping industry accounts for a significant portion of global greenhouse gas emissions and needs to decarbonize to reach a 1.5°C scenario. In a business-as-usual scenario, maritime trade volumes are expected to triple by 2050, leading to financial penalties, higher carbon taxes, and reduced consumer demand for companies that do not reduce emissions. However, there are investment opportunities in new innovations, and up to $1.9tn in investment is needed to meet the IMO’s current 2050 emission targets.


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Source: Schroders


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