Contributing to Australia’s energy transition

Discover how Australia’s first Commonwealth Government Green Bond is helping support the nation’s transition to a low-carbon economy.

• Backing Australia’s low-carbon transition
• Funding renewables, transport and climate resilience
• Find out more about Pendal’s Responsible Investing capabilities 

Regnan Credit Impact Trust and Pendal Sustainable Australian Fixed Interest Fund invested in the first Australian Commonwealth Government Green Bond.

Green bonds are meant to finance solutions for climate change and environmental challenges, but not all bonds are equal.

We’ve seen quite a few green-labelled bonds that are simply doing business as usual.

For governments, this is a particular risk, with green bonds made up of already-completed projects that they were going to work on anyway, such as public transport or other infrastructure projects.

We invested in this bond because half the proceeds will go towards existing commitments and half will go towards new commitments.

In our view, this is quite reasonable and is better than some other green bonds from governments.

The list of projects financed through the bond includes some that will help with the transition to a low-carbon economy – with the focus on renewable energy, clean transport, climate change adaptation, and a circular economy.

Electricity generation is the biggest source of emissions in Australia, so upgrading the grid to allow greater renewable energy connectivity will be essential in reducing emissions.

Electrification using renewable energy will significantly reduce emissions.

The green bond includes investments in modernising the electricity grid and developing new transmission infrastructure through concessional financing.

This bond also funds projects that relate to this – from community batteries and electric vehicle charging infrastructure to loans for energy-saving home upgrades.

Prior to issuing, the government announced funding to progress leadership on climate action in government operations, which includes financing to support all Commonwealth entities in publicly reporting on their climate risks, opportunities and management.

This bond is consistent with recent government action to respond to climate change as well as engage in environmental repair through this bond.

Find out about

Pendal Sustainable
Australian Fixed Interest Fund

George Bishay, Head of Credit and Sustainable Strategies

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