Green Bonds are bonds of which the proceeds will be allocated to green, or climate-related, expenditures and investments.
On 21 May 2019, the State of the Netherlands was the first country with a triple-A rating to issue a green bond (DSL). By issuing the Green Bond, the Netherlands aims to further enhance and support the establishment of a robust green capital market.
€ 5.98 billion was issued in the new 20-year green DSL 2040. In the coming years the bond will be tapped to a benchmark size of approximately € 10 bn, as is regular practice for longer-dated DSLs.
The proceeds of the Green Bond will be allocated to green, or climate-related expenditures and investments undertaken by the government. These categories include renewable energy (SDE-arrangement), energy efficiency (STEP-arrangement), clean transportation (expenditures and investments in rail infrastructure) and climate change adaptation (Deltafund). Eligible green expenditures include expenditures from the entire budget year preceding the issuance, the budget year of issuance and future budget years. DSTA intends to allocate at least 50% of the proceeds of the issued Green Bond to expenditures in the budget year of issuance or future budget years. The DSTA will report on the allocation of the proceeds and on the impact.
As is common practice with a Green Bond, an independent expert, in this case Sustainalytics, has assessed the Dutch Green Bond. Sustainalytics has concluded that the Green Bond Framework, underlying this Green Bond, is credible, meaningful and in line with the core elements of the Green Bond Principles from the International Capital Market Association (ICMA). In addition, the green bond has been certified by the Climate Bonds Initiative and meets specific climate criteria.
Please refer to the one-pager on the 20-year green DDA for more details about the DDA results