Energy

Electricity Transmission, Distribution and Storage Systems

Formerly Electrical Grids and Storage

Powering the Transition to a Low-Carbon Future

The decarbonisation of the global energy system hinges on two critical components:

Decarbonising power generation.
Ensuring the efficient transmission distribution, and storage of low-carbon electricity to high-emission sectors such as transport, buildings and industry.

This transformation requires substantial investment in electricity transmission and distribution systems capable of integrating renewable energy, supporting electrification and strengthening energy system resilience.

Addressing Greenhouse Gas (GHG) Emissions

The energy sector is the largest source of GHG emissions globally. To limit global warming to 1.5°C, the energy system must undergo rapid decarbonisation.

Decarbonising electricity generation reduces power sector emissions.
Electrifying transport, buildings and industry depends on access to reliable, low-carbon electricity.
Modern electricity grids are essential to connect renewable generation and deliver clean power where it is needed.

Purpose of the Criteria

The Electricity Transmission, Distribution and Storage Criteria set science-based requirements for investments in electricity networks that support the transition to a low-carbon economy.

These Criteria:

Align with the Paris Agreement's goal of limiting global warming to 1.5°C.
Support investment in electricity transmission and distribution infrastructure.
Provide clear, science-based guidance for identifying eligible green grid investments.

The existing Criteria are aligned with the EU Taxonomy and many national sustainable finance taxonomies, using science-based emissions thresholds to assess electricity systems. The updated Criteria build on this approach by introducing an additional forward-looking eligibility pathway, enabling more countries with credible electricity sector decarbonisation plans to access green finance while maintaining the scientific integrity of the Climate Bonds Standard.

This expansion is particularly relevant for countries across Africa, Latin America and the Caribbean, and Asia that require significant investment in electricity networks to support their energy transition.

Why Electricity Transmission, Distribution and Storage Matter

Electricity transmission, distribution and storage systems are fundamental to decarbonisation.

They:

Deliver renewable electricity to consumers.
Enable the electrification of transport, buildings and industry.
Support the integration of distributed renewable energy resources.
Increase the flexibility and resilience of electricity systems.
Reduces curtailment of renewable energy that are waiting for transmission and distribution infrastructure
Modern electricity networks have evolved beyond connecting large, centralised power plants. Today's systems increasingly integrate geographically dispersed renewable generation, distributed energy resources and microgrids.

Updated Scope

The updated Criteria better reflect the changing role of modern electricity systems and now cover two activities:

Electricity transmission,distribution and storage via the main grid.
Electricity transmission, distribution, and storage via microgrids.

The Criteria also identify five decarbonisation measures that support emissions reductions through investments in electricity networks.

System-level measures:

Reinforcement, expansion and modernisation of existing transmission, distribution and storage systems.
Interconnection of existing transmission,distribution and storage systems.

Project-level measures:

Connecting low-carbon electricity generation to transmission and distribution networks.
Reducing renewable energy curtailment.
Connecting isolated regions currently powered by diesel or oil generators to the electricity grid.

Do No Significant Harm (DNSH)

While electricity transmission and distribution systems are essential for enabling decarbonisation, the infrastructure itself may have environmental impacts.

To address these risks, the updated Criteria introduce Do No Significant Harm (DNSH) requirements to help minimise adverse environmental impacts while supporting climate mitigation objectives.

For projects focused on climate resilience, Climate Bonds is also developing the Climate Bonds Resilience Taxonomy, which includes resilience-related criteria for electricity transmission and distribution systems.

Public Consultation now open

Climate Bonds invites stakeholders across the finance, the energy sector and policy communities to provide feedback on the proposed updates.

Your input will help ensure the Criteria remain robust, practical and aligned with the latest science and market developments, supporting the growth of credible, investable waste sector solutions.

Submit your feedback and take part in the consultation:

Consultation open until: 22 September 2026

Submit your feedback here.

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Technical Working Group

Working group

Elisabeth Cremona

Senior Energy Analyst

Ember

Adrián Mate

Environmental Coordinator

GINGR (Global Initiative for Nature, Grids and Renewables) / Renewables Grid Initiative (RGI)

José Miguel Acosta

Energy Advisor

J+ Consultoría, Bogotá

Juan Carlos Belza

Comisión de Integración Energética Regional (CIER)

Kae Takase

Senior Manager, Climate Change

Renewable Energy Institute (REI), Japan

Lucia Fuselli

Founder, Climate Strategies

Green Grids Initiative (GGI)

Ryan Snowden

Policy Analyst

Green Grids Initiative

Steve Pye

Professor of Energy Systems, Deputy Director, UCL Energy Institute

UCL / Climate Compatible Growth Programme

William Blyth

Director; Associate Fellow

Oxford Energy Associates; Chatham House

Financial Working Group

Working group

Max Thomas

ESG Solutions

HSBC

Randolph Brazier

Global Head, Clean Power Systems (Global Sustainability)

HSBC

Resources

Public Consultation is now open

We welcome feedback from investors, issuers, utilities, policymakers, verifiers, industry representatives, civil society organisations and other interested stakeholders to expand access to Climate Bonds Certification for credible electricity grid investments.

Submit your feedback here.

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Certification

To see the whole list of Electricity Transmission, Distribution and Storage Systems (formerly Electrical Grids and Storage) Climate Bonds, visit our Database of Certified Bonds

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