Electrical Utilities Criteria

The Electrical Utilities Criteria (March 2024) by the Climate Bonds Initiative establish a technical framework for certifying electrical utilities and their debt instruments. To achieve certification, entities must align their emission intensity with a transition pathway targeting net-zero by 2040, commit to no fossil fuel expansion after January 1, 2023, and phase out fossil fuel trading by 2030-2040. The criteria set strict thresholds for hydrogen carbon intensity, biomass emissions, and CCS capture rates (90%), while requiring methane leakage controls for gas plants and comprehensive climate adaptation and resilience risk assessments.

• The Electrical Utilities Criteria provide a framework for certifying entities and debt instruments based on their alignment with a 1.5-degree Celsius warming limit, requiring a transition to net-zero emissions by 2040.
• Entity certification is divided into two tiers: 'Aligned' (Level 1), where the entity meets sector-specific transition pathways at the time of certification, and 'Transitioning' (Level 2), where the entity must align with these pathways by December 30, 2030.
• The emission intensity transition pathway for the power sector sets specific gCO2/kWh thresholds for different years: 460 in 2025, 186 in 2030, 48 in 2035, 3 in 2040, and 0 by 2045 and 2050.
• To be eligible for certification, parent companies must commit to zero future expansion of fossil fuel activities (exploration, extraction, transport, and refining) after January 1, 2023, and phase out fossil fuel trading by 2040 at the latest.
• The criteria define specific phase-out dates for fossil fuel trading based on economy type: advanced economies must phase out coal and oil trading by 2030 and fossil gas by 2040, while emerging economies have until 2040 for all three.
• Eligible mitigation measures for fossil fuel power plants include Carbon Capture and Storage (CCS) and Carbon Capture Utilisation and Storage (CCUS) with a required capture rate of 90%, or 100% cofiring with low-carbon synthetic fuels or solid biomass.
• Hydrogen used in the sector must meet carbon intensity thresholds that decrease over time: 3.0 kgCO2e/kgH2 in 2023, 1.5 kgCO2e/kgH2 in 2030, 0.7 kgCO2e/kgH2 in 2040, and 0 kgCO2e/kgH2 by 2050.
• Biomass used as fuel must not exceed GHG emissions of 5.5 gCO2e/MJ for embedded emissions in production and transport, and must be sourced from allowed materials such as woody energy crops and agricultural residues.
• For fossil gas plants, the criteria require the implementation of measures to limit methane leakages, including detection and reparation programs following EU Taxonomy regulation.
• Adaptation and Resilience certification requires entities to conduct risk assessments that identify climate risks and implement management plans to ensure the entity is robust and fit-for-purpose.

APA

Climate Bonds Initiative (2024). Electrical Utilities Criteria. https://www.climatebonds.net/files/drupal-files/files/cbs-electrical-utility-criteria-v1_0.pdf

Chicago

Climate Bonds Initiative. Electrical Utilities Criteria. 2024. https://www.climatebonds.net/files/drupal-files/files/cbs-electrical-utility-criteria-v1_0.pdf.

Wikipedia

{{cite report |author=Climate Bonds Initiative |title=Electrical Utilities Criteria |date=March 2024 |url=https://www.climatebonds.net/files/drupal-files/files/cbs-electrical-utility-criteria-v1_0.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatebondsinitiative2024electrical, author = {{Climate Bonds Initiative}}, title = {{Electrical Utilities Criteria}}, institution = {Climate Bonds Initiative}, year = {2024}, month = mar, url = {https://www.climatebonds.net/files/drupal-files/files/cbs-electrical-utility-criteria-v1_0.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }