Reporting 2016

Management of Proceeds

Reporting as of 31 December 2016:

As one of the world's largest financiers of renewable energy, KfW endeavours to make an active contribution to climate protection through its capital market activities. Amounts equal to the net proceeds from the issuances are invested in projects under KfW's programme "Renewable Energies - Standard".

"An Investment in 'Green Bonds - Made by KfW' enables investors to directly combine measurable climate protection effects with their investment."

Dr Günther Bräunig
Member of the Executive Board of KfW Group

In 2016, KfW issued four green bonds: its first public green bond denominated in SEK ( XS1351716896) with a total issuance volume of SEK 1 billion was already issued in the first quarter of 2016. In the second quarter, KfW issued a EUR green bond ( XS1414146669) with a total volume of EUR 1 billion and a maturity of eight years. This marks KfW's first green bond with a maturity in the excess of five years. Two further deals followed in November, when KfW tapped its GBP green bond initially issued in 2015, maturing in 2020, by GBP 250mn (XS1268337844) and issued a 5y USD 1.5bn green bond ( US500769HD99). The net proceeds from the green bonds amount to an equivalent of EUR 2.8 billion. Proceeds in foreign currency are converted into Euro at the ECB's exchange rate on the pricing date of the respective issuance.

In the same period, KfW received requests for disbursements under the loan programme “Renewable Energies – Standard” in an amount of EUR 4.2 billion.

An amount equal to the net proceeds from KfW’s green bonds issued in 2016 was fully invested in projects under the loan programme “Renewable Energies – Standard” as of 31 December 2016. Thus, approximately 66% of the total disbursements under the programme in 2016 were refinanced through green bonds.

99% of all requests for disbursements were related to projects for the use of wind energy (86%) and solar energy (13%). 1% accounted for hydropower, biogas/biomass systems as well as other projects.

While the projects financed were located principally in Germany, 21% of all requests for disbursements were related to projects located outside Germany - in France, Denmark, the United Kingdom, Finland, the Netherlands, Croatia, Japan, Ireland, Austria, and Canada.

Requests for disbursements by type of use

Reporting on individual issuances 2016

KfW Green Bond 0.500% SEK 2016/2021
Nominal value	SEK 1,000,000,000
Net proceeds	EUR 106,741,874
thereof invested in KfW’s programme "Renewable Energies - Standard"	EUR 106,741,874
	Fully allocated

KfW Green Bond 0.050% EUR 2016/2024
Nominal value	EUR 1,000,000,000
Net proceeds	EUR 994,500,000
thereof invested in KfW’s programme "Renewable Energies - Standard"	EUR 994,500,000
	Fully allocated

KfW Green Bond 1.625% GBP 2015/2020 Tap
Nominal value	GBP 250,000,000
Net proceeds	EUR 296,134,274
thereof invested in KfW’s programme "Renewable Energies - Standard"	EUR 296,134,274
	Fully allocated

KfW Green Bond 2.000% USD 2016/2021
Nominal value	USD 1,500,000,000
Net proceeds	EUR 1,407,516,248
thereof invested in KfW’s programme "Renewable Energies - Standard"	EUR 1,407,516,248
	Fully allocated

The independent Centre for Solar Energy and Hydrogen Research Baden-Württemberg (ZSW) has assessed the environmental and social impact of KfW’s loan programme “Renewable Energies – Standard” in Germany in recent years. On this basis, KfW estimates the environmental and social impact of its green bonds as follows:

On the basis of the estimated environmental and social impact, KfW’s green bond issuances in 2016 contribute to the prevention of approximately 2,243,914 tons of greenhouse gas (GHG) emissions per annum. This corresponds roughly to GHG-reducing effects of a forest larger than New York City, London, Tokyo and Berlin together.

Furthermore, KfW estimates that the proceeds of the green bonds will create and/or secure an estimated 61,000 jobs and reduce energy imports to Germany and/or costs associated with fossil fuel in an estimated amount of approximately EUR 193 million per annum. In addition, the green bonds contribute to the reduction of external costs – for example, by avoiding environmental and health damage – by approximately EUR 263 million per annum.

	Environmental impact of this bond (estimated)	Social impact of this bond (estimated)
KfW Green Bond 0.500% SEK 2016/2021	GHG reduction of 85,393 t p.a. (CO2 equivalent)	Savings of approx. EUR 7mn p.a. for energy imports and/or fossil fuel costs Creation or securing of more than 2,300 jobs Savings of approx.. EUR 10mn p.a. in external costs (e.g. by avoiding environmental and health damage)
KfW Green Bond 0.050% EUR 2016/2024	GHG reduction of 795,600 t p.a. (CO2 equivalent)	Savings of approx. EUR 68mn p.a. for energy imports and/or fossil fuel costs Creation or securing of more than 21,800 jobs Savings of approx.. EUR 93mn p.a. in external costs (e.g. by avoiding environmental and health damage)
KfW Green Bond 1.625% GBP 2015/2020 Tap	GHG reduction of 236,907 t p.a. (CO2 equivalent)	Savings of approx. EUR 20mn p.a. for energy imports and/or fossil fuel costs Creation or securing of more than 6,500 jobs Savings of approx.. EUR 27mn p.a. in external costs (e.g. by avoiding environmental and health damage)
KfW Green Bond 2.000% USD 2016/2021	GHG reduction of 1,126,013 t p.a. (CO2 equivalent)	Savings of approx. EUR 97mn p.a. for energy imports and/or fossil fuel costs Creation or securing of more than 30,000 jobs Savings of approx.. EUR 132mn p.a. in external costs (e.g. by avoiding environmental and health damage)

This estimated environmental and social impact is based on third-party evaluation data for recent years and for projects located in Germany. Once ZSW has completed its evaluation of KfW’s loan programme "Renewable Energies - Standard" for the year 2016, which can take up to two years, KfW will separately announce the actual environmental and social impact of the green bond issuance listed above.

The Estimates are based on programme impact 2010-2014 in Germany - numbers evaluated by ZSW - and internal calculations; Current and future impact might be different, especially for projects outside of Germany.

Each investment of EUR 1 million thus results in a reduction of 800 t p.a. in greenhouse gas emissions, saves EUR 69,000 p.a. in energy import costs from fossil fuels, creates and/or secures 22 jobs per year and saves external costs otherwise incurred annually amounting to EUR 94,000, e.g. through the avoidance of environmental and health damage.