Contact is committed to a sustainable energy future and wants to take a leading role in supporting the transition to a low carbon economy for the benefit of our environment and communities.
To continue to support this transition, we have developed a Sustainable Finance Framework. This ties the financial impacts of our loan programme to our sustainability ambitions and creates an opportunity for lenders and investors to invest in certified Green Debt Instruments and recognise the value of our low carbon renewable generation assets.
We’ve invested in building our renewable, flexible and reliable generation portfolio which has helped us to reduce our greenhouse gas emissions from generation by over 50% since 2018 and are targeting net zero Scope 1 and 2 emissions by 2035.
Through our commissioning of Tauhara and Te Huka 3 geothermal power stations, and the expected closure of our gas fired Taranaki Combined Cycle plant we are supporting a just transition away from fossil fuels to help meet the anticipated demand for reliable renewable electricity. Our gas fired Te Rapa plant has been closed as of June 2023.
Sustainable finance plays a key role in demonstrating to investors we are committed to our goals in a credible, transparent and material manner. To continue to support this transition, we have developed a Sustainable Finance Framework. This ties the financial impacts of our debt programme to our sustainability ambitions and creates an opportunity for lenders and investors to invest in Green or Sustainability-Linked Debt Instruments and recognise the value of our low carbon renewable generation assets.
Today, all of Contact’s Debt is either Green labelled or Sustainability-Linked. This demonstrates finance’s commitment to Contact’s decarbonisation journey through the use of proceeds against a green asset pool or sustainability performance targets influencing our cost of funds.
Our Framework is based on ICMA’s Green/Sustainability-Linked Bond Principles (GBP/SLLBP), APLMAs Green/Sustainability-Linked Loan Principles (GLP/SLLP) and the Climate Bonds Standard V4.3 (CBS), which are universally accepted as a basis for capital markets issuance of Green/Sustainability-Linked Debt. This can be found here (download PDF).
Contact will use an amount equal to the net proceeds from the Green Debt Instruments to finance or refinance environmental assets and/or activities that are Green Assets per the eligibility criteria set out in the framework including existing and future renewable generation assets.
Contact’s Green Borrowing Programme has been structured to include a dedicated pool of eligible geothermal and hydropower assets under both the CBS and GBP/GLP, as well as a separate pool of hydropower assets solely aligned to the GBP/GLP.
Contact is committed to ensuring that the Green Debt under its Framework is always at least 1.0 times covered by the value of its Green Assets (the “Green Ratio”), 2.02x as at 30 June 2025.
Contact has appointed DNV to provide a Second Party Opinion on the Sustainable Finance Framework, to confirm alignment with the CBS, GBP and GLP which may be found here (download PDF).
The previous version of the Framework (download PDF) received independent assurance from EY.(download PDF).
Contact’s Sustainable Finance Framework has been refreshed to remain market leading. Investors have the opportunity to invest in select CBI certified Green Debt Instruments issued by a New Zealand company.
This is a progressive approach to green finance and will better support Contact’s past and future renewable energy generation initiatives whilst also providing investors and lenders with an opportunity to access a broad range of certified green debt instruments.
"Contact Energy continues to lead market best practice in green finance, offering investors a robust opportunity to support and benefit from New Zealand's renewable energy initiatives. By issuing Certified Climate Bonds, Contact Energy not only reaffirms its commitment to sustainability but also paves the way for substantial progress in the global transition towards clean energy."
- Sean Kidney, Founder and CEO Climate Bonds Initiative.
Since the Climate Bonds Initiative Hydropower criteria were finalised, Contact sought to include its Hydro Assets in its Green Asset pool.
In October 2023, international experts were brought on-site to undertake the Hydropower Sustainability Assessment and assess Contact’s ESG performance across 12 topics, benchmarking our hydro schemes against good international practice as a requirement of CBI certification.
Verification of the report against the criteria was also undertaken and we have since achieved integration of the Clyde and Roxburgh Hydro Assets into the Green Asset pool. Getting our hydro schemes certified has freed up an extra $1.7 billion for future CBI certified green borrowing.
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