Berlin

ELIGIBLE COMMERCIAL &RESIDENTIAL BUILDINGSGERMANY
Low Carbon Buildings Criteria
under the Climate Bonds Standard
What are the Low Carbon
Buildings Criteria?
They are the technicalstandards that buildings(or a portfolio of buildings)
must satisfy to be eligible as nominated useof proceeds in a Certified Climate Bond. Anybond being certified must also meet thereporting and transparency requirements ofthe overarching Climate Bonds Standard.
This brochure outlines the Buildings Criteria
for all buildings in Germany. For full details
on the methodology and requirements, seethe detailed Criteria document.
When is a German building eligible forcertification?

• It has or will undergo an upgrade or
retrofit which reduces its emissions
intensity by 30-50% (depending on thetenor of the bond).
What do the low carbon emissions
trajectories or proxy represent?
They represent rapid decarbonisation
trajectories aligned with the goals of theParis Agreement to limit global warming to
no more than 2 degrees above pre-industrial
levels, and ideally no more than 1.5 degrees.
Trajectories are expressed as an emission
intensity metric: kg CO e/m2 while proxies
2are expressed using a range of building codes
and rating scheme including build year or post
occupancy performance rating and standards.

Where can issuers go to find more
information to check compliance?
The trajectory & proxy(s) for Germany
are illustrated in the boxs below. Moreinformation about compliance for Germany
can be found on the Low Carbon Building’s
page.
Want more information?

It is eligible for certification if it meets thefollowing Climate Bonds requirements:

How have trajectories and proxies been
established?

• It meets the low carbon emissions
trajectory OR approved proxyTrajectories have been established by taking
the emissions intensity of the top 15% ofbuildings in that city and drawing a linear

German Residential
Proxypathway down to zero carbon in 2050. They
are location specific to reflect a number offactors which vary significantly by region.
Proxies use differing techniques to measure
the correlation between an established codeot rating scheme and it ability to produce
emissions reductions in-line with the Criteria& rapid decarbonisation.

Contact Cory.Nestor@ClimateBonds.net
regarding the Low Carbon Building Criteria;
Contact Matteo.Bigoni@ClimateBonds.net
regarding portfolio/asset certification.

Figure 1 . Low carbon residential proxy requirements for Germany

Residential buildings are eligible forcertification if the asset meets theapproved market proxy
The proxy diagram (Figure 1) showsthe established low carbon buildings
trajectory for residential buildings inGermany. Any building is eligible if itmeets the this pre-approved market proxy.

EPC
“A”

OREPC
“B”

For example, for a 10-year bond issued in2018, the assets included in the issuancemust achieve an EPC rating of “B” orabove.
This proxy was established using datafrom the Energieausweis datebase
provided by Germany Energy Agency.

Low Carbon Building Criteria: GermanyNote: Residential buildings must demonstrate compliance with the German EPC rating
system, Energieausweis (EPC), achieving a rating of “A” OR “B”.​​1

Commercial buildings are eligible forcertification if the asset‘s emissions
intensity lies below the establishedtrajectory
The trajectory chart (Figure 1) showsthe established low carbon buildings
trajectory for commercial buildings inBerlin. Any commercial building is eligible
if it meets the emissions intensity target
for the mid-point of their bond.
For example, for a 10-year bond issued in2018, the emissions intensity at the timeof issuance for a building in Berlin must be
at or below 56.23kg/ CO2e.

German Commerical
Proxy

Figure 1. Low carbon trajectory for Berlin
66.64
56.23Emissions Intensity (kg CO2 e/ m2)

German Commercial
Trajectory

45.81

20 yr
35.40

2018

2023

Commercial buildings are eligible forcertification if the asset meets theapproved market proxy

10 yr

2028

2033

The proxy diagram (Figure 1) showsthe established low carbon buildings
trajectory for commercial buildings inGermany. Any building is eligible if itmeets the this pre-approved market proxy.

30 yr

For example, for a 10-year bond issued in2018, the assets included in the issuancemust be a part of an existing MBS pool
undergoing refinancing, be built after
2008, and hold an EPC rating.

2050

This proxy was established using datafrom the German building code andGerman Energy Agency.

Note: Examples have been included for three different bond tenors, 10 yr, 20 yr, and 30 yrshowing how the desired tenor of the issuer effects the emissions intensity target of the bond.

BuiltAfter2008

HasEPC

Existing

RatingRefinance
Pool

Note: Commercial buildings must demonstrate compliance with all three of the above
criteria to qualify for certification under the proxy route, otherwise, issuers must
demonstrate compliance with the German low-carbon trajectory (above).

How is a market proxyestablished?

How is an emissions
performance trajectory
established?

Steps for developing a proxy

Steps for developing a trajectory
Each trajectory uses the same approach,making global reporting more harmonised,allowing issuers and investors to compare
across markets. The following steps
highlight the fundamentals.

Figure 1 . Low carbon commercial proxy requirements for Germany

Each proxy uses the a similar approach,making global reporting more harmonised,allowing issuers and investors to compare
across markets. The following steps
highlight the fundamentals.
Trajectories are established for specificbuilding types (offices, hotels, shopping
centers) on a city/region or country
basis where data is available.

Trajectories are used to derive
emissions performance targets thatbond issuers must achieve to gain
Climate Bond Certification.

Proxies are established for specificbuilding types (offices, hotels, shoppingcenters) on a city basis where data isavailable.

15%

Proxies are used to derive currently
best available building code or rating
scheme that bond issuers must achieve
to gain Climate Bond Certification.

Country

15%

ProxyPDF

CO2CO20 CO2
The start of the trajectory is the top
15% most emission efficient buildings
in a city given as the carbon intensity
metric kg CO2/m2.

Trajectories are linear and aim forzero emissions in 2050. This means
emissions performance targets forbond issuers become more demanding
over time.

Proxies are representative of the top
15% most emission efficient buildings
in a particular market.

The Climate Bonds CO2 Target
Calculator automatically calculates
the emissions performance targets for
an issuer based on city, building type,bond issuance year and bond term.

Proxies are placeholders until more data
becomes available. This means proxies
expire or are reassessed on an ongoingbasis.

An issuer can find a list of available
proxies for residential here andcommercial here.

Disclaimer: The information contained in this communication does not constitute investment advice in any form and the Climate Bonds Initiative is not an investment adviser. Any reference to a nancialorganisation or investment product is for information purposes only. Links to external websites are for information purposes only. The Climate Bonds Initiative accepts no responsibility for content on
external websites. The Climate Bonds Initiative is not endorsing, recommending or advising on the merits or otherwise of any investment or investment product and no information within this communication should be taken as such, nor should any information in this communication be relied upon in making any investment decision. A decision to invest in anything is solely yours. The Climate Bonds
Initiative accepts no liability of any kind, for any investment an individual or organisation makes, nor for any investment made by third parties on behalf of an individual or organisation, based in whole orin part on any information contained within this, or any other Climate Bonds Initiative public communication. © Climate Bonds Initiative June 2018.

Low Carbon Building Criteria: Germany

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