Water Climate Bond Standard
New Standard Will Help Address $1 Trillion Supply and Demand Gap for Financing Water-Related Infrastructure
A new standard for climate-resilient water bonds provides investors with verifiable science-based criteria for evaluating water-related bonds.
Developed in consultation with global water experts, the standard is part of a broader Climate Bonds Standard certification scheme designed by the Climate Bonds Initiative to provide clear, sector-specific eligibility criteria for water related green bonds.
The standard, or “Water Climate Bonds Criteria,” will certify water investments that have:
- Carried out climate vulnerability assessments considering past, present and future climate risks and;
- Have relevant climate adaptation and/or mitigation plans
The standard criteria was developed by a consortium including the Climate Bonds Initiative, Alliance for Global Water Adaptation (AGWA), Ceres, CDP and the World Resources Institute. Dozens of global water experts were also involved in the process, which was led by a Technical Working Group convened by the consortium.
How the New Standard Helps Address a Critical Financing Gap
The American Water Works Association estimates that there is a $1 trillion supply and demand gap for financing water-related projects and infrastructure over the next 25 years. And there is a big need to ensure that these investments are sustainable and climate ready.
The standard will help investors deploy their capital more rapidly towards water infrastructure while raising awareness from the issuer market – whether corporations or municipalities – that sustainable and climate resilient projects are sought by the investment community.