Hydropower Criteria Development of Eligibility Criteria for the Climate Bonds Standard & Certification Scheme Background Paper

The document establishes a two-component eligibility framework for hydropower certification: a Mitigation Component and an Adaptation & Resilience (A&R) Component. The Mitigation Component uses a 'predictive screen' based on power density to identify low-risk assets, while others must undergo a GHG assessment using the G-res tool or on-site studies to meet emissions intensity thresholds of 100g CO2e/kWh (pre-2020) or 50g CO2e/kWh (post-2020). The A&R Component requires assets to be assessed via the ESG Gap Analysis Tool, with strict limits on the number of 'significant gaps' allowed and a requirement for an Environmental and Social Action Plan (ESAP) to close those gaps within 24 months. Additionally, the criteria mandate Free, Prior and Informed Consent (FPIC) for indigenous peoples and public disclosure of compliance data.

• Hydropower assets must satisfy two primary requirements for certification: a Climate Change Mitigation Component and a Climate Change Adaptation and Resilience Component.
• The Mitigation Component employs a 'predictive screen' based on power density to exempt low-risk facilities from full GHG assessments. The proposed thresholds are 5 W/m2 for facilities subject to a 100 gCO2e/kWh threshold and 10 W/m2 for those subject to a 50 gCO2e/kWh threshold.
• Facilities not passing the predictive screen must meet specific emissions intensity thresholds: 100g CO2e/kWh for those operational before 2020, and 50g CO2e/kWh for those operational during or after 2020.
• The G-res tool, developed by the International Hydropower Association and UNESCO, is the recommended standardized methodology for estimating net GHG emissions, though full on-site assessments are also permitted.
• For multi-purpose reservoirs, GHG emissions are allocated based on the 'operating regime' approach, which assigns emissions according to the hierarchy of services (Primary 80%, Secondary 15%, Tertiary 5%).
• Pumped storage facilities must meet additional criteria to ensure they are GHG-beneficial, such as being built in conjunction with intermittent renewables or contributing to a grid with at least 20% intermittent renewable penetration.
• The A&R Component requires assessment using the ESG Gap Analysis Tool. To pass, a facility must have no more than 10 significant gaps in total and no more than 2 significant gaps per topic.
• Certification requires that Free, Prior and Informed Consent (FPIC) of Indigenous Peoples be achieved in accordance with the UN Declaration on the Rights of Indigenous Peoples.
• Issuers must publicly disclose compliance information, including power density, GHG assessments, the accredited assessor's ESG gap analysis report, and FPIC status.

APA

Climate Bonds Initiative (2021). Hydropower Criteria Development of Eligibility Criteria for the Climate Bonds Standard & Certification Scheme Background Paper. https://www.climatebonds.net/files/drupal-files/files/Hydro-Background-Paper-Mar%202021-release3%281%29.pdf

Chicago

Climate Bonds Initiative. Hydropower Criteria Development of Eligibility Criteria for the Climate Bonds Standard & Certification Scheme Background Paper. 2021. https://www.climatebonds.net/files/drupal-files/files/Hydro-Background-Paper-Mar%202021-release3%281%29.pdf.

Wikipedia

{{cite report |author=Climate Bonds Initiative |title=Hydropower Criteria Development of Eligibility Criteria for the Climate Bonds Standard & Certification Scheme Background Paper |date=March 2021 |url=https://www.climatebonds.net/files/drupal-files/files/Hydro-Background-Paper-Mar%202021-release3%281%29.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatebondsinitiative2021hydropower, author = {{Climate Bonds Initiative}}, title = {{Hydropower Criteria Development of Eligibility Criteria for the Climate Bonds Standard \& Certification Scheme Background Paper}}, institution = {Climate Bonds Initiative}, year = {2021}, month = mar, url = {https://www.climatebonds.net/files/drupal-files/files/Hydro-Background-Paper-Mar%202021-release3%281%29.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }