What is Programmatic Certification?
Climate Bonds Programmatic Certification is a streamlined process for obtaining Climate Bonds Certification. It involves the verification of a large pool of eligible assets in anticipation of a multiple green bond issuance programme.
The designated asset pool is verified and repeat Certified issuance can be made at the Issuer’s discretion. The independent Verifier provides annual verification to ensure that the bonds and the overall programme continue to meet the requirements of the Climate Bonds Standard.
Who should adopt Programmatic Certification?
Large or repeat bond Issuers with established debt capital raising programmes and capability. These may be banks, insurers, public or private utilities, listed corporates or listed/unlisted infrastructure debt managers.
It is particularly useful for Issuers with a large portfolio of assets who are looking to follow international best practice in green debt issuance and demonstrate to investors their commitment to low carbon investment in line with the goals of the Paris Climate Agreement.
Is Programmatic Certification different from Basic Certification?
The Basic Certification process involves both pre-issuance and post-issuance verification on each individual issuance to receive Certification.
Programmatic Certification requires pre-issuance and post-issuance Verification for the first bond issued under the programme and subsequently requires annual Verification for the duration of the programme.
Programmatic removes the pre-issuance step on individual bonds ensuring a smoother internal process while maintaining the integrity of the Certification process.
Does the Issuer have to have a minimum number of future planned issuances to be part of Programmatic Certification?
As a guideline, though this is not a requirement, it is expected that the Issuer will plan to issue bonds at least once a year. If the Issuer plans to issue less frequently, it is more suited for the Issuer to use the Basic Certification route for individual bond issuances.
Can the Issuer change the asset pool after it received the initial Certification?
Yes, the asset pool may change over time.
The Issuer can add or subtract projects and assets from the portfolio. Whether the portfolio changes or not, each bond and the pool of projects and assets will be reviewed by the Verifier annually, to see if it meets the Climate Bonds Standard.
What are the Costs of Programmatic Certification?
Climate Bonds Programmatic Certification costs are the same as basic Certification costs, which is 1/10th of a basis point of the size of the bond. For example, the Certification Fee for each issuance of a $100 million bond under Programmatic Certification is $1000.
The Certification Fee is invoiced for each individual bond issuance under the programme.
Does the Issuer have to have a minimum size of bond issue to be part of Programmatic Certification?
There is no minimum. An example is New York State Housing Finance Agency (HFA) that has issued 10 bonds of multiple denominations; all lower than benchmark size.
Who Uses the Programmatic Approach?
To date, 10 Issuers have adopted Programmatic Certification with SNCF Réseau, Westpac, San Francisco Public Utilities Commission (SFPUC), Société du Grand Paris, National Australia Bank (NAB) and New York Metropolitan Transportation Authority (MTA) together issuing bonds to the value of USD15 billion. See table below for the current list of Programmatic Issuers. Also, know more about each Issuer in Programmatic Case Studies.
How can you find out more?
Please contact directly:
Head of Certification
Climate Bonds Initiative
Australia: +61 402 298 569
Climate Bonds Initiative