Financing low-carbon buildings and energy efficiency in the green bond market

This briefing by the Climate Bonds Initiative examines the use of green bonds to finance low-carbon buildings and energy efficiency globally, with a specific focus on opportunities for Japan. It details the role of various issuers, including property companies, banks, and governments, and highlights the significance of the green securitisation market.

• The buildings sector is a critical target for decarbonisation as it is responsible for approximately 28% of global energy-related CO2 emissions.
• As of the end of November 2018, USD 126 billion had been allocated to low-carbon buildings assets and projects within the green bond market. Financial corporates, specifically property lenders and mortgage banks, contributed USD 24.2 billion of this total.
• Green securitisations, including asset-backed securities (ABS) and mortgage-backed securities (MBS), are major components of the market. ABS issuance specifically allocated to buildings reached USD 40 billion. In the US, Fannie Mae has issued USD 47 billion to refinance mortgages for buildings with green certifications or those achieving at least 25% reductions in water or energy consumption.
• Property companies have raised USD 15.5 billion across 16 countries for green buildings and upgrades. Sweden and France are leading issuers, while Singapore and Hong Kong showed strong issuance volumes in 2018.
• Public sector entities have allocated USD 11.8 billion to buildings, focusing on infrastructure such as hospitals, schools, and universities. In the US, local governments and agency issuers have allocated over USD 5 billion to buildings.
• In Japan, the green bond market totaled USD 9.2 billion by the end of November 2018, with approximately one-third (around USD 3 billion) allocated to low-carbon buildings. The Development Bank of Japan is the largest sector issuer, allocating nearly USD 2.2 billion across four green bonds for buildings with a DBJ Green Building Certification of 3 stars or higher.
• The Tokyo Metropolitan Government has used green bonds for both low-carbon buildings and climate adaptation. It allocated USD 36 million to smart energy and urban development, and approximately 30% of its proceeds to adaptation projects, including coastal protection and tsunami facilities.

APA

Climate Bonds Initiative (2019). Financing low-carbon buildings and energy efficiency in the green bond market. https://www.climatebonds.net/files/documents/publications/cbi_gb_lcb_briefing_31012019.pdf

Chicago

Climate Bonds Initiative. Financing low-carbon buildings and energy efficiency in the green bond market. 2019. https://www.climatebonds.net/files/documents/publications/cbi_gb_lcb_briefing_31012019.pdf.

Wikipedia

{{cite report |author=Climate Bonds Initiative |title=Financing low-carbon buildings and energy efficiency in the green bond market |date=January 2019 |url=https://www.climatebonds.net/files/documents/publications/cbi_gb_lcb_briefing_31012019.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatebondsinitiative2019financing, author = {{Climate Bonds Initiative}}, title = {{Financing low-carbon buildings and energy efficiency in the green bond market}}, institution = {Climate Bonds Initiative}, year = {2019}, month = jan, url = {https://www.climatebonds.net/files/documents/publications/cbi_gb_lcb_briefing_31012019.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }