LGFA Undertakes First Climate Action Loans
LGFA launched its Climate Action Loan Lending Programme for council and council-controlled organisations (CCO) members on 1st December 2022, and is now pleased to announce that our inaugural loans have been made.
Auckland Council, Dunedin City Treasury Limited and Hutt City Council have become the first council and CCO borrowers to draw down under the programme.
To compliment the Green, Social and/or Sustainability Lending programme (GSS Loans) launched in October 2021, LGFA has widened its sustainable finance options for borrowers and offering them the opportunity to apply for Climate Action Loans (CALs). CALs align to LGFA’s aim of displaying leadership to the sector on sustainable lending and encouraging its council and CCO members to make progress on sustainability issues.
CALs are target (or incentive) based lending structures designed to incentivise borrowers to act on climate change and reduce greenhouse gas emissions. A CAL rewards a borrower through a margin discount if that borrower has adopted an Emission Reduction Plan (ERP) which sets out specific Emissions Reduction Targets (ERT). Both the ERP and ERT relate to a borrower’s operational greenhouse gas emissions at council or CCO level. CALs are targeted to all borrowers, including those who may not have eligible projects to access GSS loans.
As at 17th April 2023, NZ$355.7 million of CALs Loans have been approved by LGFA.
If you have any questions, please contact Nick Howell (Head of Sustainability) on +64 21 227 3738.