Project Details
Project
Neutral Capital Finance PLC Green Bond Framework Second-Party Opinion (2021)
Client
Neutral Fuels LLC
Project Type
Green Bond/Loan
Industry Group
-
Use of Proceeds
-
Location
U.K.
Evaluation Date
May 2021
Evaluation Summary
Sustainalytics is of the opinion that the Neutral Capital Finance PLC Green Bond Framework is credible and impactful and aligns to the four core components of the Green Bond Principles 2018. This assessment is based on the following:
USE OF PROCEEDS
The eligible categories for the use of proceeds –Eco-efficient and/or Circular Economy Adapted Products, Production Technologies and Processes, and Clean Transportation – are aligned with those recognized by the Green Bond Principles 2018. Sustainalytics considers that the investments in eligible categories will lead to positive environmental impacts and advance the UN Sustainable Development Goals (“SDGs”), specifically SDGs 7, 9 and 12.
PROJECT EVALUATION / SELECTION
The Neutral Fuels LLC (‘Neutral Fuels”) investment team will be responsible for the approval of eligible projects under the Framework. The investment decision will involve at least one of Neutral Fuels’ Chief Executive Officer, Chief Financial Officer or Chief Operating Officer (“COO”). The company has articulated a clear process for evaluating projects, and where necessary, may rely on third-party sustainability experts. Sustainalytics considers the project selection process to be in line with market practice.
MANAGEMENT OF PROCEEDS
Neutral Fuels’ Finance Department, supported by its COO, will be responsible for the allocation of bond proceeds per the criteria defined in the Framework. The company intends to fully allocate all proceeds within 36 months from the issuance. Pending allocation, proceeds may be held in cash or cash equivalents or invested in money market funds. This is in line with market practice.
REPORTING
Neutral Fuels intends to report on the allocation of proceeds on its website annually until full allocation. The allocation reporting is expected to include project-level details on the allocation of proceeds, proportion of financed and refinanced projects, and the balance to unallocated proceeds. In addition, Neutral Fuels also intends to report on quantitative impact metrics, including avoided emissions, and annual waste diverted from waste stream. Sustainalytics views the allocation and impact reporting as aligned with market practice.