LMA Guidance On Green Loans

Introduction

Green Loans are becoming increasingly common in loan markets, enabling borrowers to promote environmental sustainability and also providing a number of ancillary benefits for businesses; including enhanced reputation and credibility; access to socially conscious investors seeking investments with a positive environmental, social, and corporate governance focus; and increased attractiveness to skilled employees whom increasingly value environmental considerations.

In the real estate lending market, "green" finance is playing an increasingly important role in light of the net-zero emissions targets by 2050 set by the EU for Member States. These targets are set to be incorporated into Irish law by the Climate Action and Low Carbon Development (Amendment) Bill 2020. As buildings account for approximately 40% of energy consumption and 36% of CO2 emissions in the EU, significant emissions reductions will need to be achieved in respect of buildings in order