BMO creates energy transition group for moves to hydrogen fuel and renewablesJune 11, 2021
The group in the capital markets division is meant to advise companies changing to greener energy.
The Bank of Montreal (BMO) has announced its intentions to form an investment-banking group for advising companies seeking to use hydrogen fuel and other renewable energy sources.
The energy transition group (ETG) will be a component of the capital markets division at BMO.
The purpose of the ETG is to help companies to spot opportunities to use technologies and programs that will help them to reduce their carbon footprint and meet their climate change targets. This has arrived at a time in which large companies and banks have been struggling to keep up with the challenge of adopting hydrogen fuels and other sources of renewable energy that provide alternatives to fossil fuels.
BMO vice chair of investment and corporate banking Aaron Engen stated that many of BMO’s clients have already taken the steps to establish their own energy transition groups. Those clients have been increasing their sustainability efforts.
Hydrogen fuel and other alternatives are becoming more widely available but still require a transition plan.
“Our clients have been increasingly, and with more momentum, thinking about the energy transition broadly in terms of how the economy consumes and produces energy, and what role our clients play in that,” said Engen in an interview as quoted by the Financial Post.
The new ETG will be led jointly by Engen and Jonathan Hackett, the BMO sustainable finance managing director. It will bring together BMO Capital Markets’ industry teams in power utilities and infrastructure, energy, industrials, metals and mining, and food and retail.
Hydrogen fuel, renewable power, and electric vehicle fleets will be among the areas in which the group will be advising companies across sectors. It also intends to introduce them to businesses that can provide them with additional assistance in meeting their climate objectives while developing the necessary strategies for financing those transitions.
“If you look at renewable power, the financial sophistication of the way we finance solar and wind has progressed,” said Hackett. “The question is how do we bring those sorts of tools into other industries. It’s easy enough to say to just do a carbon purchase agreement and you’ll be able to finance it, but instead to take the real work underpinning those tools and building the way that we can leverage them in new spaces — it’s one place that we see a real opportunity to help catalyze areas that don’t have the maturity.”