Second-Party Opinion Download

Sustainalytics is of the opinion that the Transport for London (TfL) Green Bond Framework 2020 is credible and impactful and aligns with the four core components of the Green Bond Principles 2018. This assessment is based on the following:

USE OF PROCEEDS

The eligible categories for the use of proceeds (i) Clean Transportation, (ii) Pollution prevention and control, and (iii) Renewable energy are aligned with those recognized by the Green Bond Principles 2018. Sustainalytics considers that the eligible categories will lead to positive environmental impacts and advance the UN Sustainable Development Goals, specifically SDG 3, 9, 7 and 11.

PROJECT EVALUATION/SELECTION

Transport for London’s internal process for evaluating and selecting projects is managed by the “working group”, which is led by the Group Financial Accounting (“Accounting”) department, with support from Corporate Finance, TfL’s Safety, Health and Environment and City Planning teams. On an annual basis, the working group will review the aggregate pool of green expenditures for alignment with eligibility criteria listed in the Framework. The Issuer intends to fully allocate proceeds within 24 months after the issuance date of each Green Bond. Sustainalytics considers the project selection process in line with market practice

MANAGEMENT OF PROCEEDS

Transport for London’s processes for management of proceeds is handled by the working group. Transport for London intends to allocate an amount equal to the net process to its general cash pool and track so that this cash is linked to its expenditure in the Eligible Green Project Categories. Pending full allocation, the balance of unallocated proceeds will be invested in cash or short-term, liquid money market instruments in accordance with TfL’s Treasury Management Strategy & Policies. This process is aligned with market practice.

REPORTING

Transport for London intends to report on allocation of proceeds on its website on an annual basis until full allocation. TfL will report on total amount allocated to Eligible Green Projects, the year of investment/disbursement and the balance of unallocated proceeds. In addition, TfL is committed to reporting on relevant environmental impact metrics. Sustainalytics views Transport for London’s allocation and impact reporting plans to be aligned with market practice.