Project Details
Project
Australian Government Green Bond Framework Second-Party Opinion (2023)
Client
Australian Government
Project Type
Green Bond/Loan
Industry Group
Sovereign
Use of Proceeds
Renewable energy; Energy efficiency; Clean transport; Green buildings; Climate change adaptation; Natural resources/land use management; Conservation; Water/waste water management; Pollution prevention and control;
Location
Australia
Evaluation Date
Dec 2023
Evaluation Summary
Sustainalytics is of the opinion that the Australian Government Green Bond Framework is credible and impactful and aligns with the four core components of the Green Bond Principles 2021. This assessment is based on the following:
USE OF PROCEEDS
The eligible categories for the use of proceeds – Renewable Energy, Energy Efficiency, Clean Transportation, Green Buildings, Climate Change, Environmentally Sustainable Management of Living Natural Resources and Land Use, Biodiversity Conservation, Sustainable Water and Wastewater Management, Circular Economy, and Pollution Prevention and Control – are aligned with those recognized by the Green Bond Principles. Sustainalytics considers that investments in the eligible categories will lead to positive environmental impacts and advance the UN Sustainable Development Goals, specifically SDGs 6, 7, 9, 11, 12, 14, 13 and 15.
PROJECT EVALUATION AND SELECTION
The Green Bond Committee, which comprises senior representatives from relevant government departments will be responsible for the project evaluation and selection process, supported by the Australian Treasury. Australia has comprehensive laws, and control procedures in place to mitigate environmental and social risks associated with the eligible green expenditures under the Australian Government Green Bond Framework. Sustainalytics considers the project evaluation and selection process to be in line with market practice.
MANAGEMENT OF PROCEEDS
The Australian Treasury will be responsible for the management of proceeds using a dedicated tracking process. The Australian Treasury aims to fully allocate net proceeds within two years of issuance. Pending full allocation, unallocated proceeds will be managed according to the Australian Office of Financial Management’s liquidity management practices. This is in line with market practice.
REPORTING
The Australian Government commits to publicly report on the allocation of proceeds and corresponding impact as part of a dedicated report published on the Australian Office of Financial Management’s website on an annual basis until full allocation. The allocation report will commence at most 18 months after issuance and include information on the total amount of proceeds allocated to eligible projects, the balance of unallocated proceeds, share of financing versus refinancing, the percentage extent of co-financing and information on any material risks. In addition, the Australian Government commits to report on relevant impact metrics. This is in line with market practice.