The Greater London Authority’s (GLA) green financing framework has received an “excellent” Second-Party Opinion by Sustainable Fitch.
In June, the authority launched its framework, which supports the GLA’s future issuances of green bonds and other green instruments to fund an internally managed facility called the Green Finance Fund (GFF). This will lend up to £500m to projects by the GLA Group and public sector partners, such as local authorities, across London.
The aim of the GFF is to help Greater London achieve its target of reaching net zero by 2030, a goal set by the Mayor of London, Sadiq Khan.
According to Sustainable Fitch, which is the environmental, social and governance rating division of the financial information service Fitch Group, the GLA’s green financing framework aligns to the four core pillars of the the International Capital Market Association (ICMA) Green Bond Principles and the Loan Market Association Green Loan Principles.
This is due to the framework containing three of the ICMA Green Bond Principles in its project categories, which are renewable energy, energy efficiency and clean transportation.
The Second- Party Opinion also confirmed the framework’s alignment to environmental credentials through the use of proceeds to fund projects within these three categories.
Hence, Sustainable Fitch has assigned a qualification of “excellent” to the GLA’s green financing framework.
According to the GFF, projects funded under the renewable energy category will help decarbonise and increase the flexibility of London’s energy system, with investments dedicated to the generation, transmission, distribution and storage of energy.
Projects funded under energy efficiency will target improving existing buildings, whilst those under the clean transportation category will help to reduce emissions, both greenhouse gases and pollutants, of vehicles or the transport system.
Sustainable Fitch added in its Second-Party Opinion: “We consider the use of proceeds to contribute clear environmental benefit within the selected eligible categories.”
—————
FREE weekly newsletters
Subscribe to Room151 Newsletters
Follow us on LinkedIn
Follow us here
Monthly Online Treasury Briefing
Sign up here with a .gov.uk email address
Room151 Webinars
Visit the Room151 channel
