Project Details
Project
K-water Green Bond Second-Party Opinion
Client
K-water
Project Type
Green Bond/Loan
Industry Group
-
Use of Proceeds
-
Location
South Korea
Evaluation Date
Mar 2018
Evaluation Summary
Sustainalytics is of the opinion that the K-water Green Bond Framework is credible and impactful and aligns with the four pillars of the Green Bond Principles 2017.
USE OF PROCEEDS
The eligible categories for the use of proceeds (i.e. Climate Change Adaptation, Sustainable Water Supply, Renewable Energy and Water Management) are recognized by the Green Bond Principles as project categories with positive environmental benefits.
PROJECT EVALUATION/SELECTION
K-water’s project evaluation and selection process is executed through a multi-level committee chaired by the Vice-President of K-water. The projects are reviewed by a dedicated ‘Investment and Funding Review Committee’. Sustainalytics views this process as in line with market best practices.
MANAGEMENT OF PROCEEDS
K-water’s processes for management of proceeds is in line with market practices. K-water’s treasury team will track the green bond proceeds internally, with the lookback period for the allocation of net proceeds being 2 full years prior to the bond issuance year. Pending the full allocation, the balance will be earmarked and held in temporary investments in accordance with standard treasury management.
REPORTING
K-water commits to issuing integrated allocation and impact reporting annually. The allocation reporting will include relevant transaction data such as the allocation of proceeds to eligible projects, while the impact reporting will comprise metrics for each of the ‘Eligible Green Categories’ (e.g. flood control capacity (in billion m3 ), number and length of waterways, installed capacity in MW, annual GHG emissions avoided, annual renewable energy production (in MWh), decrease of pollution concentration, etc.).