Solar Sector Criteria
The Solar Sector Eligibility Criteriaof the Climate Bonds Standard &Certification Scheme
Updated: April 2023

Note:

These Criteria can be used to certify Use-of-Proceeds Instruments, Sustainability-Linked
Debt Instruments, Assets and Entities per the Climate Bonds Standard v4.0

Revision

Date

Summary of Changes

Rev 2.3

13 April 2023

Revisions to enable Entity Certification and SLD
Certification in line with release of CBS v4.0

Rev. 2.2

May 2022

Taxonomy updates

Rev. 2.1

November 2021

Taxonomy updates

Rev. 1.0

July 2014

First publication of original Criteria

Climate Bonds Initiative - Solar Sector Criteria Document
Updated: April 2023

Definitions
Applicant: The term or name for any potential bond issuer, or non-financial corporate entity that might seek certification under theCement Criteria.
Certified Entity: The entity or part thereof which is being certified under the Climate Bonds Standard. Currently, Entity Certification
is limited to non-financial Entities or segregated segments thereof, for which the Climate Bonds Initiative has Climate Bonds
Standard Sector Criteria for Entity Certification.
Climate Bonds Initiative (Climate Bonds): An investor focused not-for-profit organisation, promoting large-scale investments thatwill deliver a global low carbon and climate resilient economy. Climate Bonds seeks to develop mechanisms to better alignthe interests of investors, industry and government to catalyse investments at a speed and scale sufficient to avoid dangerous
climate change.
Climate Bonds Standard (CBS): A screening tool for investors and governments that allows them to identify green bonds theproceeds of which are being used to deliver climate change solutions. This may be through climate mitigation impact and/orclimate adaptation or resilience. The CBS is made up of two parts: the parent standard (CBS v3.0) and a suite of sector specificeligibility Criteria. The parent standard covers the certification process and pre- and post-issuance requirements for all
certified bonds, regardless of the nature of the capital projects. The Sector Criteria detail specific requirements for assets
identified as falling under that specific sector. The latest version of the CBS is published on the Climate Bonds website.
Climate Bonds Standard Board (CBSB): A board of independent members that collectively represents $34 trillion of assets undermanagement. The CBSB is responsible for approving (i) Revisions to the CBS, including the adoption of additional sector
Criteria, (ii) Approved verifiers, and (iii) Applications for Certification of a bond under the CBS. The CBSB is constituted,appointed, and supported in line with the governance arrangements and processes as published on the Climate Bonds website.
Climate Bond Certification: allows the applicant to use the Climate Bond Certification Mark in relation to that bond. Climate Bond
Certification is provided once the independent CBSB is satisfied the bond conforms with the CBS.
Critical interdependencies: The asset or activity’s boundaries and interdependencies with surrounding infrastructure systems.
Interdependencies are specific to local context but are often connected to wider systems through complex relationships that
depend on factors ‘outside the asset fence’ that could cause cascading failures or contribute to collateral system benefits.
Green Bond: A green bond is a bond of which the proceeds are allocated to environmental projects or expenditures. The term
generally refers to bonds that have been marketed as green. In theory, green bonds proceeds could be used for a wide varietyof environmental projects or expenditures, but in practice they have mostly been earmarked for climate change projects.
Industry Working Group (IWG): A group of key organisations that are potential applicants, verifiers and investors convened by
Climate Bonds. The IWG provides feedback on the draft sector Criteria developed by the TWG before they are released for
public consultation.
Investment Period: The interval between the bond’s issuance and its maturity date. Otherwise known as the bond tenor.
Parent Company/Group: A company is considered a parent company of another entity (a subsidiary) if it exercises control over thesubsidiary. The terms “control” and “subsidiary” have the meaning assigned to them under International Financial ReportingStandard 10 (IFRS 10). A Parent Group consists of the Parent Company and all the companies that the Parent Company
exercises control over. Where the Applicant does not belong to a group of companies, the term Parent Company applies tothe Applicant.
Sustainability-Linked Debt (SLD): Any debt instrument for which the financial and structural characteristics can vary depending onwhether the issuer achieves predefined Sustainability/ ESG objectives. Such objectives are measured through predefined KPIs
and assessed against predefined performance targets. Proceeds of SLD are intended to be used for general purposes.
Technical Working Group (TWG): A group of key experts from academia, international agencies, industry and NGOs convened by
Climate Bonds. The TWG develops the Sector Criteria - detailed technical criteria for the eligibility of projects and assets aswell as guidance on the tracking of eligibility status during the term of the bond. Their draft recommendations are refined
through engagement with finance industry experts in convened Industry Working Groups (see below) and through publicconsultation. Final approval of Sector Criteria is given by the CBSB.
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Climate Bonds Initiative - Solar Sector Criteria Document
Updated: April 2023

Table of ContentsDefinitions

2

1

4Introduction
1.1

The Climate Bonds Standard

4

1.2

Environmental scope of the Solar Criteria

4

1.3

What can be certified under the Solar Criteria

4

1.4

Documents supporting these Criteria

4

1.5

Revisions to these Criteria

42

Solar assets and activities eligible under these Criteria53

Solar assets and activities not eligible under these Criteria

5

List of Tables
Table 1: Eligible solar facilities

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Climate Bonds Initiative - Solar Sector Criteria Document
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1 Introduction
1.1 The Climate Bonds Standard
Investor demand for climate bonds is strong and is expected to increase in line with the delivery of quality products into the market.
However, investor concerns about the credibility of green labelling are also growing. Standards, assurance & Certification will beessential to improve confidence and transparency, which in turn will enable further strong growth in the market.
Today, the Climate Bonds Standard and Certification Scheme is an easy-to-use screening tool that provides a clear signal to investors
and intermediaries on the climate integrity of Certified Climate Bonds. Proposals are currently under consultation to also expand
certification to entities with climate integrity.
A key part of the Standard is a suite of sector-specific eligibility Criteria. Each sector-specific Criteria sets climate change benchmarks
for that sector that are used to screen debt instruments, assets and/ or entities, so that only those that have climate integrity, either
through their contribution to climate mitigation, and/or to adaptation and resilience to climate change, will be certified.
These sector-specific Criteria are determined through a multi-stakeholder engagement process, including TWG and IWG, convened
and managed by Climate Bonds, and are subject to public consultation. Finally, they are reviewed and approved by the ClimateBonds Standard Board (CBSB).
The second key part of the Climate Bonds Standard (CBS) is the overarching Climate Bonds Standard v4.0. This documents thecross-sectoral criteria all certified instruments/ assets/ entities must meet, in addition to meeting the sector specific Criteria.

1.2 Environmental scope of the Solar Criteria
Currently, the Solar Sector Criteria address climate change mitigation only.

1.3 What can be certified under the Solar Criteria
Use-of-Proceeds1 instruments, Sustainability-Linked Debt Instruments, Assets and Entities relating to solar activities can be Certified
using these Solar Criteria. However, see Sections 2 and 3 below for the specific Solar assets and related activities in scope / not in
scope respectively and any eligibility criteria for those assets and activities.
See also the Climate Bonds Standard v4.0 for any cross sectoral requirements for Use-of-Proceeds, Sustainability-Linked Debt, Assetor Entity Certification. These cross sectoral requirements must be met in addition to the solar-specific requirements described inthis document.

1.4 Documents supporting these Criteria
Information to support applicants and verifiers is available as follows:•••

Solar Background paper that details why these criteria were chosen.
The Climate Bonds Standard v4.0 contains the cross-sectoral requirements of the overarching CBS.
The Climate Bonds Standard v4.0 Entity and Sustainability-Linked Debt Checklist documents: provides further informationon the cross-sectoral requirements for Entity and Sustainability-Linked Debt Certification respectively.

For more information on Climate Bonds and the Climate Bonds Standard and Certification Scheme, see www.climatebonds.net.

1.5 Revisions to these Criteria
These Criteria will be reviewed on a regular basis, at which point the TWG will take stock of the deals that are printed in the earlystages and any developments in improved methodologies and data that can increase the climate integrity of future deals. As a1Use-of-Proceeds (UoP) is used as shorthand throughout this document for a variety of targeted finance instruments, including green loans, repos, and asset-backed
securities. Annex 1 of the Climate Bonds Standard v4.0 details the full list of instruments that can be certified.
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Climate Bonds Initiative - Solar Sector Criteria Document
Updated: April 2023

result, the Criteria are likely to be refined over time, as more information becomes available. Certification will not be withdrawn
retroactively from bonds certified under earlier versions of the Criteria.

2 Solar assets and activities eligible under these Criteria
Proceeds related to the establishment, acquisition, expansion, and/ or ongoing management of the solar energy or thermalgeneration facilities listed in Table 1 are eligible for Use-of-Proceeds Certification.
Solar energy or thermal generation facilities listed in Table 1 are eligible for Asset Certification.
Entities whose economic activities are solar energy generation or solar thermal generation related, driven by the assets listed inTable 1 are eligible for Entity Certification. This Certification is Level 1: “Aligned”.2
Sustainability-Linked Debt linked to solar energy generation or solar thermal generation related activities driven by the assets listed
in Table 1 are eligible for Sustainability-Linked Debt Certification. This Certification is Level 1: “Aligned”.3
Table 1: Eligible solar facilities
Facilities•Onshore solar electricity generation facilities•

Wholly dedicated transmission infrastructure, grid connections and other supportinginfrastructure for onshore solar electricity generation facilities including inverters,
transformers, energy storage systems and control systems.

•Onshore solar thermal facilities such as solar hot water systems.

•Onshore solar heat/cool and power cogeneration facilities.

•Dedicated operational production, manufacturing or distribution facilities for keycomponents, such as solar panels, inverters etc.

NOTE:

Eligibility Criteria

A minimum of 85% ofelectricity generated
from solar energy
resources

Automaticallyeligible

Current proposals would allow for the certification of only part of a company or group of companies, or SLD that
relates to only part of a company or group of companies. See the Climate Bonds Standard v4.0 parts C and D
respectively for full details. This flexibility enables the certification of the part of a company or group of companies
relating to steel production, separate from the certification of other activities of the company or group ofcompanies of which it forms a part.

3 Solar assets and activities not eligible under these Criteria
The following offshore assets and activities are NOT eligible for Certification under these Solar Criteria as they are instead addressedunder the Marine Renewable Energy Criteria:•••

Offshore solar electricity generation facilities
Wholly dedicated transmission infrastructure and other supporting infrastructure for offshore solar electricity generation
facilities including inverters, transformers, energy storage systems and control systems.
Offshore solar thermal facilities such as solar hot water systems.

2 Entity and SLD certification under the Climate Bonds Standard recognizes two levels of Certification. Level 1 is known as “Aligned” and representsalignment with 1.5 degree pathways at the time of Certification, Level 2 as “Transitioning” and represents transitioning to align with 1.5 degree
pathways by 2030 at the latest. See Parts C and D of the Climate Bonds Standard v4.0 for further information on these two levels.
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