Buildings Criteria - Background Paper

The Buildings Criteria - Background Paper provides the technical rationale and methodology for the Climate Bonds Standard's eligibility criteria for low-carbon buildings. It establishes a framework to align building investments with a 1.5-degree Celsius warming scenario by focusing on emissions intensity trajectories, the electrification of heating and cooling, and the mandatory reporting of Whole Life Carbon Assessments (WLCA) for new constructions to address embodied carbon.

• The Buildings Criteria aim to ensure that assets in Certified Climate Bonds align with emissions trajectories compatible with net zero carbon emissions by 2050 to support the 1.5-degree Paris Agreement goal.
• The standard prioritizes emissions intensity (kgCO2e/m2) over energy use intensity (EUI) because EUI does not account for the emission intensity of the underlying fuel source or the benefits of fuel switching to decarbonized grids.
• Low-carbon trajectories are established on a city-by-city basis to account for local variations in climate, grid mix, building characteristics, and occupancy patterns, preventing buildings in high-energy-demand locations from being unfairly penalized.
• The starting point for a city's emissions trajectory is based on the performance of the top 15% of the relevant market, balancing the need for high standards with the necessity of providing certification opportunities for existing best performers.
• For markets lacking sufficient operational data, the Climate Bonds Initiative allows the use of market-accepted proxies (such as LEED or BREEAM) or a 'significant improvement' pathway, defined as a 30-50% reduction in emissions intensity depending on the bond term.
• New buildings must be delivered without the use of fossil fuels and include electric mobility infrastructure to be considered 'net-zero ready,' ensuring they do not lock in carbon-intensive plant or require future redundant investments.
• The criteria explicitly discourage the use of hydrogen as a primary pathway for building decarbonization, citing that direct electrification is more efficient and that hydrogen infrastructure is largely non-existent compared to electrical grids.
• Whole Life Carbon Assessment (WLCA) reporting is mandatory for new buildings built on or after 2025 to capture embodied carbon from material extraction, manufacturing, and construction, which accounts for 13% of global carbon emissions annually.
• The scope of the WLCA for new buildings focuses on 'cradle to site,' specifically requiring the assessment of Module A (product and construction), Module C (end of life/demolition), and Module D (recovery benefits).
• The criteria focus on 'base building' emissions (core and shell) under the landlord's control, excluding tenant-controlled energy use such as office equipment and internal lighting, as these are outside the issuer's financial or management control.

APA

Climate Bonds Initiative (2023). Buildings Criteria - Background Paper. https://www.climatebonds.net/files/drupal-files/files/sector-criteria-buildings-background-document-v2-1-Dec2023.pdf

Chicago

Climate Bonds Initiative. Buildings Criteria - Background Paper. 2023. https://www.climatebonds.net/files/drupal-files/files/sector-criteria-buildings-background-document-v2-1-Dec2023.pdf.

Wikipedia

{{cite report |author=Climate Bonds Initiative |title=Buildings Criteria - Background Paper |date=September 2023 |url=https://www.climatebonds.net/files/drupal-files/files/sector-criteria-buildings-background-document-v2-1-Dec2023.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatebondsinitiative2023buildings, author = {{Climate Bonds Initiative}}, title = {{Buildings Criteria - Background Paper}}, institution = {Climate Bonds Initiative}, year = {2023}, month = sep, url = {https://www.climatebonds.net/files/drupal-files/files/sector-criteria-buildings-background-document-v2-1-Dec2023.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }