The Policy & Practice of Climate Change & Water

the Netherlands

Conservation Finance Takes Off as the Netherlands Issues One of the Largest Green Bonds Ever

Conservation Finance Takes Off as the Netherlands Issues One of the Largest Green Bonds Ever
by James Anderson 1, Todd Gartner 1, Alex Mauroner 2, and John Matthews 2
1 World Resources Institute (WRI)
2 Alliance for Global Water Adaptation (AGWA)
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The conservation finance market hit a new high-water mark in recent weeks as the Dutch government issued one of the largest green bonds ever: 5.98 billion euros (roughly $6.8 billion). This bond for low-carbon development and sustainable water management will finance, among other things, natural infrastructure solutions in the Netherlands that are crucial for protecting one of the world's lowest-lying countries from floods and sea-level rise.

The enthusiasm for the bond also signals a bigger trend: the shift in conservation finance from a niche market to a mainstream, large-scale investment strategy.
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Netherlands Invests €5.98 billion in Ecosystems to Cope with Climate Change Impacts

Netherlands Invests €5.98 billion in Ecosystems to Cope with Climate Change Impacts


LONDON (27 May 2019) — Global investors have enthusiastically embraced a national Netherlands 5.98 billion euro green bond designed to fund projects to cope with current and future climate change impacts and an advanced low-carbon economy. Much of the bond focuses on using coastal and river ecosystems as a safeguard for negative climate impacts such as high flood risk. Investors responded to the bond immediately, oversubscribing the issuance by more than 15.2 billion euros.

This green bond is the first globally to employ resilient nature-based solutions certified using the Water Infrastructure Criteria of the Climate Bonds Standard. A consortium of organizations led by the Climate Bonds Initiative, the Alliance for Global Water Adaptation (AGWA), the World Resources Institute (WRI), CDP, and Ceres launched water resilience bonds criteria in May 2018 to inform investors about the climate risks and solutions embedded in the green bonds market. Globally, the green bonds market reached about 168 billion USD in 2018.

Niels Vlaanderen, Policy Advisor for International Affairs at the Department of Infrastructure and Water Management for the Netherlands, commented: “We realized that we needed new solutions — automatically building flood dykes higher was no longer a sustainable solution. We had to change a system we had worked with for centuries and broaden our goals. We must future-proof our country by incorporating cultural and ecological values into our adaptive decision making.”

According to John Matthews, Executive Director of the Alliance for Global Water Adaptation and lead author of the Water Infrastructure Green Bonds Criteria, “For the past thousand years, the Dutch have reclaimed land from the sea. Today, the sea and their rivers are growing higher in a country where half of the country is already below sea level. With this bond issuance, the national government is signaling to investors the scope of the financing needed to adjust to climate change — and how we must link economies and ecosystems together to secure a joint future in a shifting climate.”

The bond also plays a role in sustainable development according to Henk Ovink, Special Envoy for International Water Affairs, Kingdom of The Netherlands Sherpa to the UN/WB High Level Panel on Water, adding, “This green bond is spot on, aimed at creating added values across the board of the sustainable development goals, leveraging investments for social, cultural, economic and environmental needs and challenges. Using water as leverage to catalyze transformative climate action.”

Justine Leigh-Bell, Deputy CEO at Climate Bonds Initiative (CBI) in London, stated, “Resilience is a powerful new target for investment. The Netherlands has just shown that investors are eager to see policymakers investing in long-term resilience and in working with rather than against nature. Using the Water Infrastructure Criteria rewards issuers and investors together, providing market and citizen confidence for innovative approaches such as nature-based solutions to flood risks.”

Niels Vlaanderen continued, “In Dutch, we say, ‘Als er één schaap over de dam is, volgen er meer,’ or ‘We need only a few to lead.’ Indeed, this bond is the beginning of a very promising area where we expect large funding requirements in the near future. We have proven that the Netherlands can shift strategies to prepare for a changing climate. With our room for the river projects, we have shown that we can combine flood protection and social values through nature-based solutions.”

The benefits of this bond are not limited to at-risk communities and ecosystems. The Netherlands’ Minister of Finance, Wopke Hoekstra, stated, “Our aim is to give an extra boost to the Dutch green capital market through the issuance of the Green Bond.”

The green bond finances low-carbon projects (renewable energy, energy efficiency, clean transportation). Perhaps the most innovative aspects of the bond, however, are projects designed to help the Netherlands adjust to climate change adaptation through sustainable water management, particularly the use of nature-based solutions and green infrastructure approaches for reducing increasing flood risks in coastal and low-lying areas.


Background
Link to the criteria: https://www.climatebonds.net/standard/water
Link to more detail on the bond itself: http://bit.ly/dutch-bond
Green Bonds State of the Market report: https://www.climatebonds.net/resources/reports/green-bonds-state-market-2018
Link to additional coverage: https://www.reuters.com/article/us-netherlands-bonds-green/the-netherlands-becomes-first-triple-a-rated-sovereign-to-launch-green-bond-idUSKCN1SR16W

Media contacts - For additional information about the issuance or the various organizations involved, please contact:
AGWA - Alex Mauroner (amauroner@alliance4water.org), John Matthews (johoma@alliance4water.org)
Dutch State Treasury Agency - sbr@minfin.nl
Niels Vlaanderen, Policy Advisor for International Affairs, Department of Infrastructure and Water Management (niels.Vlaanderen@minienw.nl)
CBI - Justine Leigh-Bell (justine@climatebonds.net), press enquiries Andrew Whiley (andrew.whiley@climatebonds.net)
WRI - Todd Gartner (todd.Gartner@wri.org)

Images
https://pixabay.com/photos/the-windmills-kinderdijk-river-555944/
https://pixabay.com/photos/landscape-river-nature-water-3565856/
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The Geography of Future Water Challenges

The Geography of Future Water Challenges
A new report from the Netherlands Environmental Assessment Agency provides "a global overview of development scenarios and pathways forward, within the context of the water-related challenges up to 2050." The Geography of Future Water Challenges uses infographics as well as a narrative storyboard to describe what the world would look like if development continues along business-as-usual trajectories, particularly in the context of water issues. The report highlights the need for an integrated approach to limiting climate- and water-related risks at a global scale. Read More...
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Job Opening: Lead Hydrologist at Deltares

From Deltares:
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Are you looking for a position in an international environment for addressing the hydrological challenges of our customers? We have an interesting vacancy available!

LEAD HYDROLOGIST

The unit Inland Water Systems has over 175 employees, divided into the following six departments: Operational Water Management and Early Warning, Catchment and Urban Hydrology, Flood Risk Management, River Dynamics and Inland Shipping, Fresh Water Ecology and Water Quality and Water and Delta Management.

The Department of Catchment and Urban Hydrology is involved in a wide range of projects. In the Netherlands we work for Rijkswaterstaat and the Water Boards. Internationally, we are active in projects for the World Bank Group and the Asian Development Bank, e.g. in South East Asia, South-America and Africa. Furthermore, we participate in H2020 projects for the European Union.

We develop new approaches and tools for hydrology at different levels: from the global and river basin scale to the level of districts and roads.

In the interaction with the other units / departments of Deltares we create our added value in projects focussing on integrated water management, forecasting and multi-hazard impact assessment.

The Department currently consists of 25 hydrologists, one third with a PhD. A research and development and a customer-oriented attitude are important to us. The Department is located in Delft, the Netherlands.
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US-Netherlands Connection’s Professional Program (USNC Pro)

Florida Earth Foundation invites you to a professional program focusing on water infrastructure, governance and adaptation. During this five day program, participants will visit the world’s most advanced water infrastructure and management sites and connect with the engineers, administrators and operators responsible. The Dutch have been working on water challenges for more than 1,000 years, and Recently the focus has shifted to climate adaptation and resilience. Explore this shifting mindset, network with other professionals interested in water, and foster solutions that can be brought back and applied.

Each year Florida Earth takes a group of professionals in the water field or interested in learning more about water governance, policy and management techniques. The group visits the Maeslant Barrier, the largest moving structure in the world; Kinderdijk, famous for its windmills; Futureland, the land-creation project; and numerous ancient cities filled with incredible architecture. Read More...
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