Sustainability is on the agenda at Infrastructure Investor’s Global Summit in Berlin this week. Day one featured a dedicated ESG forum, and panels throughout the week will be tackling topics of importance to New Private Markets readers. Charles Avery is on the ground and will be bringing more coverage as the conference progresses, but for now here are a few key quotes from day one:

“We’re applying a shadow price of carbon now to all of these kinds of projects and that means… about €60 per ton per carbon ton today and rising to about €300 per ton by 2030. If the [cost benefit analysis] still comes out positive after applying that shadow price of carbon to that very fossil fuel intensive infrastructure, it can go forward. But there are things that won’t go forward because that’s a very high bar.” Matthew Jordan-Tank, director for sustainable infrastructure policy and project preparation at EBRD, explains the institution’s approach to carbon pricing.

“What we have seen in the last year is that, when we finance a deal, there are some KPI metrics and if those KPIs are met, you could have a margin increase for instance. That’s something that is not at all popular inside my organisation because we wanted to say: well, no, your decarbonisation strategy should be your base case and it should not be an upside case.” François Lejeune, infrastructure finance manager at AG Insurance, discusses sustainability-linked financing.

“I think there’s still going be some hiccups in this industry honestly… it’s just simply by the nature of what we’re trying to do, the sheer number of data points we’re looking at in sustainability; just there’s always gonna be reliability… issues until we get that ironed out.” Cathy Granneman, member relations manager at GRESB, comments on greenwashing.

“Whether it’s aviation, whether it’s transport, whether it’s water or data centres, all of our customers have set huge net-zero targets and, candidly, the vast majority don’t know how they’re going to achieve those.” Adam Petrie, infrastructure partner at Apollo, comments on the demand for sustainability improvements among the customer base of infrastructure assets.

“In Europe, there appears to be a bit of an attitude that is ‘oh, you poor Americans suffering with your red states and your ESG, sorry about that’. But let me tell you: they’re coming for you as well. The forces at work that have seized on ESG as a failed terminology (I know that’s a bit provocative for some of you) are the same forces that are going to use the political chaos in Europe, it’s no different than the United States, to seize on SFDR and basically claim that it is a standard that does not support stakeholders because we’re here to make people money.” Bill Green, managing partner at Climate Adaptive Infrastructure, gives his opinion on the ESG backlash.