A1.6bn Climate Bonds Certified Green Loan secured for Vector Metering acquisition

• World’s first Use of Proceeds instrument under the new Climate Bonds Standard v4.0
• Largest Climate Bonds Certified green bank loan under the Climate Bonds’ Electrical Grids and Storage eligibility criteria
• Green loan proceeds to fund QIC’s 50 per cent interest in Vector Metering and Vector Metering’s ongoing electricity smart metering rollout across Australia and New Zealand

 

QIC Infrastructure, on behalf of its managed funds and clients (QIC), together with Vector Limited (Vector), are pleased to announce the successful financial close of a A$1.6bn green loan for the smart metering business - Vector Metering.¹ The loan comprises green term loans to fund QIC’s 50 per cent interest in Vector Metering in addition to green capex facilities² to fund the business’ ongoing electricity smart metering expansion across Australia and New Zealand.

This is the first Use of Proceeds Certification globally under the new Climate Bonds Standard Version 4.0 (CBS v4.0)³ and is the largest Climate Bonds Certified green bank loan aligned with the Climate Bonds’ Electrical Grids and Storage eligibility criteria.⁴

This green loan was issued under Vector Metering’s Green Financing Framework, which was developed in line with the February 2023 update to the Green Loan Principles (the Principles).⁵ Vector Metering obtained a Verification Report and an assurance opinion from DNV Australia, a Climate Bonds’ Approved Verifier, confirming that the Green Instrument was issued in alignment with the Principles and CBS v4.0.

MUFG Bank Ltd, National Australia Bank Limited, Westpac Banking Corporation and Westpac New Zealand acted as joint sustainability coordinators on the transaction.

Ross Israel, Head of Global Infrastructure, QIC said it was pleasing this acquisition could be funded by green financing.

"Smart meters have a critical role to play in the decarbonisation of electricity supply in both Australia and New Zealand. Their role is rapidly evolving from data processing for timely billing purposes, to being an enabler for electricity networks to manage an ever-increasing volume and volatility of electricity supply due to the broader energy transition and increasing penetration of renewable generation,” Mr Israel said.

“This investment, together with the green financing instrument we have secured, is another demonstration of QIC Infrastructure’s commitment to supporting the transition to a low-carbon economy,” he said.

Sean Kidney, CEO, Climate Bonds Initiative congratulated QIC and Vector on Vector Metering being the first to achieve certification under the newly launched Climate Bonds Standard and Certification scheme.

“By ensuring Vector Metering’s financing meets the rigorous requirements of Climate Bonds Standard Version 4.0, QIC and Vector have demonstrated their dedication to global best practice in climate finance. This milestone underscores the importance of transparent and credible certification in mobilising capital for climate-aligned investments and demonstrates a real economy example of transition of energy systems,” Mr Kidney said.

Certification under CBS v4.0 demonstrates Vector Metering’s significant commitment to the increasing use of electricity smart metering, which is critical technology in the move towards energy efficiency and longer-term emissions reductions in the energy systems. This green loan attracted extensive interest including participation across a significant lending syndicate composed of eleven major domestic and international lenders.

JP Morgan acted as financial advisor on the transaction, with Herbert Smith Freehills and Russell McVeagh acting as borrower’s counsel and Corrs Chambers Westgarth and Bell Gully acting as lenders’ counsel.