Legal notice: Integrity and personal information. This information is important, so read carefully before proceeding. By continuing to use the website, you accept certain conditions.

Our model

Process to facilitate project inflow while maintaining high-quality project evaluation and impact reporting

Kommuninvest’s Green Bonds framework adheres to the guidelines set out by the Green Bond Principles.

Use of proceeds
Kommuninvest’s Green Bonds finance investment projects undertaken by our member municipalities and county councils/regions. Eligible projects must promote the transition to a low-carbon and climate-resilient society and be:

(a) mitigation of climate change, including investments in low-carbon and clean technologies

(b) adaptation to climate change, including investments in climate-resilient growth, or

(c) projects related to environmental management in other areas than climate change (max. 30 percent of issued volume).

Process for project evaluation and selection framework
Investment projects identified and verified by the environmental functions in Kommuninvest’s member municipalities/county councils, and selected by their treasury departments, may be eligible for Green Loan financing from Kommuninvest. Eligible projects are screened and initially approved by Kommuninvest’s Lending department, and, on a quarterly basis, reviewed and finally approved by consensus vote in the Kommuninvest Green Bonds Environmental Committee.
The Committee is an advisory board consisting of representatives from the environmental function of two or more member municipalities and county councils/regions, environmental experts from other relevant public sector organisations or academia/non-governmental organization, and from Kommuninvest’s management and lending group. Read more about the Committee here.
Eligible projects are Swedish local government investment projects in the fields of

  • Renewable energy
  • Energy efficiency in energy systems
  • Green buildings and energy efficiency
  • Clean transportation
  • Waste management
  • Water and wastewater management
  • Adaptation measures in buildings, infrastructure and sensitive surroundings
  • Environmental management.

Management of proceeds
The Green Bond proceeds are earmarked for financing of climate mitigation or adaptation projects or other environmental sustainability purposes. Our model is based on green lending preceding green funding. Kommuninvest aims for the volume of aggregated Green Bond Proceeds not to exceed total disbursements to Eligible Loans. Independent assurance is performed by Kommuninvest’s auditors.

New loans & refinancing
While we allow for both new financing and refinancing in the Green Loans portfolio, our aim is for the majority of the Green Bonds proceeds to finance new projects (planned, on-going or completed a maximum of nine months before the time of issuance). The actual distribution between new financing and refinancing will be available to investors in the annual investor report.

External review
Kommuninvest engages external input to provide investors and other interested parties with independent assurance on its Green Bonds Framework.

Consultant review (Second opinion)

The Framework has a second party opinion from Cicero, the Oslo-based climate and environmental research institute. The second opinion is available for download below.


Kommuninvest has engaged its external auditor to verify that the portfolio of Eligible Loans, against which Green Bonds are issued, does exist. The report was undertaken in accordance with ISRS4400, “Engagements to Perform Agreed-Upon Procedures Regarding Financial Information”. The report and the list of Eligible Loans that were part of the review are available for download below.

Kommuninvest annually publishes an impact report to investors, including project descriptions and expected impact for all projects with a minimum of SEK 25 million in Green Loan financing, project case studies and a summary of Kommuninvest’s Green Bond development. The first impact report was published in March 2017.

Kommuninvest encourages and promotes the use of impact analysis (ex-ante) and impact reporting (ex-post) to the largest extent possible and requires the use of it for projects encompassing fossil energy to a non-negligible extent (see below).

We base our impact reporting on industry-developed guidelines, including the Green Bonds Harmonized Framework for Impact Reporting, published in December 2015 by an informal working group of eleven international financial institutions including the European Investment Bank and the World Bank.

Fossil energy content
We take a long-term view on climate change, and does not approve investment projects that lead to a lock-in of fossil energy-based infrastructure. However, there is a possibility that some of the investments projects financed through Green Loans include elements of fossil energy, in spite of the project’s overall effect being a decreased use of fossil energy and decreased emissions of greenhouse gases.

This is because, in some cases, a fossil energy component cannot be completely avoided. One example is biofuelled power plants, which may require a certain amount of fossil energy to operate efficiently. Projects for energy-efficient buildings cannot always address the fact that there are elements of fossil energy in the national or local energy mix. Hybrid fuels and vehicles for public transport are other examples.

How we view fossil energy components in the transition to a sustainable society, and what we tolerate as part of the Green Bonds Framework, is outlined in a document available for download below.