Project Details
Project
E.ON Green Bond Framework Second Party Opinion (2021)
Client
E.ON SE
Project Type
Green Bond/Loan; EU Taxonomy Assessment;
Industry Group
Utilities
Use of Proceeds
Renewable energy; Clean transport; Energy efficiency;
Location
Germany
Evaluation Date
Dec 2021
Evaluation Summary
Alignment with the Green Bond Principles 2021
Sustainalytics is of the opinion that E.ON’s 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 –Electricity Networks, Renewable Energy, Energy Efficiency, Clean Transportation – are aligned with those recognized by the Green Bond Principles 2021. Sustainalytics considers that financing of assets in the eligible categories will lead to positive environmental impacts by supporting the uptake of clean energy in Europe and advancing the UN Sustainable Development Goals, specifically SDGs 7, 9 and 11.
PROJECT EVALUATION / SELECTION
E.ON’s Green Bond Committee, composed of representatives from Sustainability, Energy Networks, Customer Solutions and Group Finance, as well as additional subject matter experts as needed, will evaluate and select projects to be included in the Eligible Green Portfolio. Projects selected for the Portfolio will comply with all of E.ON’s internal policies and guidelines related to environmental and social risk management. Sustainalytics considers the project selection process to be aligned with market practice.
MANAGEMENT OF PROCEEDS
E.ON will manage proceeds using a portfolio approach, in which it will strive to maintain a level of allocation that matches or exceeds the balance of net proceeds of outstanding bonds. Pending full allocation, proceeds will be held in its treasury liquidity portfolio in cash, cash equivalents, money market funds, or equivalent. E.ON expects to immediately allocate all proceeds of its upcoming issuance. This is aligned with market practice.
REPORTING
E.ON intends to report on allocation and impact on an annual basis throughout the tenor of the bond. The allocation reporting will include the total amount of assets and capital expenditures in the Green Project Portfolio, the amount of proceeds used for new and/or existing projects, and the balance of the unallocated proceeds. In addition, E.ON is committed to impact reporting using quantitative metrics, to be made available as part of the Company’s green bond report. Sustainalytics views E.ON’s allocation and impact reporting as aligned with market practice.
Alignment with the EU Taxonomy
Sustainalytics has assessed E.ON’s Green Bond Framework for alignment with the EU Taxonomy, and is of the opinion that, of the Framework’s 12 eligibility criteria (across four use of proceeds categories), which map to 12 EU activities, all 12 align with the applicable Technical Screening Criteria (“TSC”) in the EU Taxonomy, and all 12 are aligned with the Do No Significant Harm Criteria. No categories were determined to be not aligned. Sustainalytics is also of the opinion that the activities and projects to be financed under the Framework will be carried out in alignment with the EU Taxonomy’s Minimum Safeguards.