Low Carbon Building Criteria – Frequently Asked Questions

This FAQ document provides guidance on the Low Carbon Building Criteria under the Climate Bonds Standard v4.0. It details the eligibility of residential, commercial, and built environment assets for green bond certification, outlining the pathways to achieve net-zero by 2050 and the specific requirements for new buildings, including the prohibition of fossil fuels and mandatory Whole Life Carbon Assessments.

• The Low Carbon Building Criteria establish two primary pathways for buildings to achieve net-zero by 2050, both aligned with the 1.5°C scenario and the Paris Agreement: an Absolute Performance Improvement Pathway (using quantitative thresholds or qualitative proxies) and a Relative Performance Improvement Pathway (requiring retrofit improvements against a pre-retrofit baseline).
• Updated criteria as of December 2023 introduce strict requirements for new buildings, which include a total shift to all-electric systems—meaning no fossil fuels may be used for cooking, hot water, heating, or on-site electricity generation—and the provision of electric mobility infrastructure in on-site parking.
• New buildings are now required to perform and report on a Whole Life Carbon Assessment (WLCA) following RICS Guidance and GHG Protocol Scope 3 recommendations. The scope of this assessment includes Modules A (A0-A5), B (B6-B8 where applicable), C (C1-C4 for demolished properties), and Module D for buildings constructed after 2025.
• The criteria utilize 'trajectories' (emission intensity metrics in kg CO2e/m2) as the primary measure for cities where they are available. In cities without a trajectory, 'proxies' based on building codes or rating schemes are used as a temporary measure until a trajectory is developed.
• While some third-party certifications are mentioned, they are not automatically eligible. BREEAM is noted as not being well correlated with carbon emissions, whereas LEED Gold is considered eligible if combined with a 30% improvement on ASHRAE 90.1.
• The updated Low-Carbon Building criteria are aligned with the EU Taxonomy Annex 1 Mitigation requirements for substantial contribution, and a supporting guide for Do No Significant Harm (DNSH) criteria has been created for investors.
• Under Climate Bonds Standard V4.0, Sustainability-Linked Bonds (SLBs) and non-financial corporate entities can be certified, but this eligibility is currently limited to commercial properties.

APA

Climate Bonds Initiative (2023). Low Carbon Building Criteria – Frequently Asked Questions. https://www.climatebonds.net/files/drupal-files/files/sector-criteria-buildings-faqs-v2_0-dec2023.pdf

Chicago

Climate Bonds Initiative. Low Carbon Building Criteria – Frequently Asked Questions. 2023. https://www.climatebonds.net/files/drupal-files/files/sector-criteria-buildings-faqs-v2_0-dec2023.pdf.

Wikipedia

{{cite report |author=Climate Bonds Initiative |title=Low Carbon Building Criteria – Frequently Asked Questions |date=December 2023 |url=https://www.climatebonds.net/files/drupal-files/files/sector-criteria-buildings-faqs-v2_0-dec2023.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatebondsinitiative2023low, author = {{Climate Bonds Initiative}}, title = {{Low Carbon Building Criteria – Frequently Asked Questions}}, institution = {Climate Bonds Initiative}, year = {2023}, month = dec, url = {https://www.climatebonds.net/files/drupal-files/files/sector-criteria-buildings-faqs-v2_0-dec2023.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }