mainstreaming Transparent Assessment of Energy efficiency in Environmental social governance ratingS
Improving access to long-term finance for Energy Efficiency (EE) projects is key to achieve the EU2030 targets and aligning the COVID-19 recovery to the European Green Deal. However, the lack of standardized disclosure of EE investments limits firms’ access to EE financing. Further, poor understanding of EE information in ESG ratings increases the risk of greenwashing, thus preventing a smooth development of the sustainable finance market. TranspArEEnS addresses these barriers by mainstreaming a quali-quantitative framework for standardized collection and analysis of firms’ EE and ESG information and the development of a standardized EE-ESG rating.
This serves as an EE-ESG filter to inform investment and financial policy decisions with regard to portfolios’ alignment to sustainability. A unique added value of this project is to cover non-listed Small and Medium Enterprises, meeting an important market need. TranspArEEnS’ EE-ESG rating will be tested in pilot case studies and capacity building sessions with leading representatives of the financial industry and supervisors. TranspArEEnS’ EE-ESG rating will be tested in pilot case studies and capacity building sessions with leading representatives of the financial industry and supervisors.
This allows to understand barriers and opportunities for its operationalization in:
- credit risk assessment;
- development of long-term EE-financing via securitization (covered bonds, European Secured Notes);
- introduction of EE-ESG considerations into monetary policies and prudential regulations.
By enhancing standardized disclosure of EE investing, TranspArEEnS will decrease uncertainty in the EE and ESG market, thus promoting the scaling up of new EE financing and investment opportunities in the EU. Moreover, it will help to mitigate the risk of greenwashing thus improving financial stability.
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Objectives of the Project
- TranspArEEnS aims to enhance standardized disclosure of EE and ESG information at firm level, to foster access to long term financing (e.g. via securitization) and better risk assessment, while taming the risk of greenwashing.
- The EE-ESG rating developed will be best positioned to make a key contribution to enhance disclosure of firms’ alignment to EU 2030 objectives, the EU Taxonomy and ESG benchmarks, focusing on EE investments.
- TranspArEEnS builds on and complements the outputs of three previous related EU-funded projects:
- the Energy efficient Mortgages Action Plan (EeMAP);
- the Energy efficiency Data Protocol and Portal (EeDaPP);
- the Energy efficient Mortgage Market Implementation Plan (EeMMIP), including a unique added value, i.e. to cover SMEs.
Last update: 01/07/2021