Project Details
Project
Fortum Green Finance Framework Second-Party Opinion (2024)
Client
Fortum Oyj
Project Type
Green Bond/Loan
Industry Group
Utilities
Use of Proceeds
Renewable energy; Energy efficiency;
Location
Finland
Evaluation Date
Jan 2024
Evaluation Summary
USE OF PROCEEDS
The eligible categories for the use of proceeds – Renewable Energy, Energy Efficiency and Nuclear Power Generation – are aligned with those recognized by the Green Bond Principles and the Green Loan Principles. Sustainalytics considers that investments in the eligible categories will lead to positive environmental impacts and advance the UN Sustainable Development Goals, specifically SDG 7.
PROJECT EVALUATION AND SELECTION
Fortum has established the Green Finance Committee which will be responsible for the project evaluation and selection process. Fortum has processes in place to identify and mitigate common environmental and social risks potentially associated with the eligible projects. Sustainalytics considers the project selection process in line with market practice.
MANAGEMENT OF PROCEEDS
Fortum’s Treasury department will be responsible for the management and allocation of net proceeds under the Framework. The Company will track the proceeds using a green register through a portfolio approach. Fortum intends to allocate the net proceeds within 24 months of issuance. Pending full allocation, proceeds will be placed in a liquidity reserve. This is in line with market practice.
REPORTING
Fortum will report annually on the allocation of net proceeds and corresponding impact in a green finance report, which will be published on its website until full allocation. In addition, Fortum intends to report on relevant impact metrics. Sustainalytics views Fortum’s allocation and impact reporting as aligned with market practice.