Second-Party Opinion Download

Evaluation Summary

Sustainalytics is of the opinion that the Landsvirkjun Green Finance Framework is credible and impactful and aligned with the four core components of the Green Bond Principles 2021 and the Green Loan Principles 2023. This assessment is based on the following:

USE OF PROCEEDS

The eligible category for the use of proceeds – Renewable Energy – is aligned with those recognized by the Green Bond Principles and the Green Loan Principles. Sustainalytics considers that the eligible category will lead to positive environmental impacts and advance the UN Sustainable Development Goals, specifically SDGs 7 and 9.

PROJECT EVALUATION AND SELECTION

Landsvirkjun’s Green Finance Committee will be responsible for evaluating and selecting projects in line with the Framework’s eligibility criteria. Landsvirkjun has internal processes to address environmental and social risks associated with the eligible projects. Sustainalytics considers the project selection process to be in line with market practice.

MANAGEMENT OF PROCEEDS

Landsvirkjun’s Treasury department will oversee the management of proceeds and will track their allocation using an internal tracking system through a portfolio approach. Landsvirkjun intends to fully allocate the proceeds within 24 months from issuance. Pending full allocation, Landsvirkjun will temporarily invest the unallocated proceeds in its Treasury liquidity portfolio as cash and cash equivalents. This is in line with market practice.

REPORTING

Landsvirkjun will report on the allocation of proceeds and corresponding impact on its website on an annual basis until maturity of the outstanding instruments. Allocation reporting will include a list of outstanding green financing instruments, the allocated amounts to eligible projects, a list of eligible projects financed and the amount of unallocated proceeds. Sustainalytics views Landsvirkjun’s allocation and impact reporting as aligned with market practice.