Münchener Hypothekenbank eG has just issued an “ESG-labelled” covered bond (or Pfandbriefe, as covered bonds are called in Germany) for refinancing of housing cooperatives. Oekom Research provided a second opinion on the “social” benefits – you can find it on our web site.
Lots of people have argues that energy efficiency and other "green" improvements should improve the value of a house, at least commensurate with the investment, but survey data on the ground has been hard to come by.
The newsletter “Asset-Backed Alert” carried a story on Friday suggesting that the US is about to see a revival of PACE (Property Assessed Clean Energy) municipal bonds, securitizing clean-energy loans to households.
The PACE (Property Assessed Clean Energy) program, strongly pushed by the US Department of Energy as the ideal financing model for residential solar panels and energy efficiency, is in trouble. It may have implications for the UK's PAYS scheme. The bonds are candidates to be called climate bonds.
The formal coalition agreement between the UK Conservative and Liberal-Democrats, released today, lists two key initiatives that have been part of Climate Bonds Initiative proposals:
- The creation of a green investment bank.- The provision of home energy improvement paid for by the savings from lower energy bills.
Also in the agreement is the provision of a floor price for carbon, something investors have been calling for.
All three are important and necessary changes relevant to governments everywhere.
