Climate Bonds publishes draft shipping criteria

Climate Bonds publishes draft shipping criteria

The Climate Bonds Initiative has published the draft Shipping Criteria, a new science-based assessment process on the low carbon and climate resilient credentials of ships.

The Criteria has been developed by a Technical Working Group (TWG) and overseen by an Industry Working Group (IWG) and has now been opened for public consultation period till 26th June 2020.

Development of the Shipping Criteria began in early 2019 and expands the reach of Climate Bonds Criteria into a major new sector. The Shipping Criteria will form part of the Climate Bonds Standard and provide a succinct set of decision rules for determining when shipping projects and assets are compatible with a low carbon, climate resilient economy, and are eligible for certification under the Climate Bonds Standard.

The draft criteria highlights:

  • No dedicated fossil fuel carrying vessels (No LNG Tankers, No Crude Carriers).
  • Zero emissions ships are automatically eligible, along with infrastructure that is dedicated to refuelling or recharging these ships.
  • Ships that are not zero-emissions must comply with the declining emissions intensity threshold (using AER or EEOI as a metric)
  • The declining emissions intensity starts at the median 2012 AER or EEOI for each size and class of ship and declines to zero by 2050. A ship must remain underneath this threshold throughout the life of the bond AND provide evidence that it can technically remain under the threshold over its entire operating life.
  • Jack up rigs that are dedicated to installing renewable energy infrastructure are eligible, provided that they are also zero-emissions.

More information can be found at the following links:

Brochure – Summary of the Shipping Criteria

Criteria Document – Full details of the Shipping Criteria

Background Paper – Summary of discussions and rationale for Criteria

Feedback Form – For comments and views

The public consultation period will run for two months and ends on June 26th, 2020. Once public consultation is complete, the feedback will be reviewed, and a final proposal will be presented to the Climate Bonds Standard Board for approval.

Once the Criteria have received Board approval, issuers of green bonds, loans (and other debt instruments eligible under Climate Bonds Standard Version 3.0) financing ships and shipping retrofit programmes will be able to seek Climate Bonds Certification.