Group 2

UmweltBank: Favourable loans for green projects


31 July 2023

For over 20 years, UmweltBank, in Germany, has been using its customers’ money exclusively to finance environmentally friendly and social projects, mainly in the field of renewable energies and ecological and social housing.

UmweltBank is proud of only offering products and doing business that visibly promotes the goal of a world worth living in. In order to guarantee this, UmweltBank has developed far-reaching positive and exclusion criteria. These provide the framework for all activities of the bank, including credit approvals.

The credit conditions for green loans are based on the premise: “The better the environmental rating, the more favourable the loan.” The goal is to create affordable, ecological housing and energy-efficient commercial properties.

UmweltBank is committed to all 17 United Nations Sustainable Development Goals (SDGs) but is focused on its core business to goals 7 (Affordable and Clean Energy), 11 (Sustainable Cities and Communities) and 13 (Climate Action). Projects must have a positive SDG influence and must not display significant controversy in one or more social and ecological criteria (exclusion criteria).

Green Social Housing 

In terms of loans for building constructions, every project is reviewed not only for its economic viability but also for ecological and social criteria. The rating system is based on a detailed catalogue of criteria that is divided into two categories: on the one hand, construction criteria such as energy efficiency, resource conservation and climate protection, and on the other hand, social aspects such as co-responsibility, integration into the neighbourhood and mobility.

One example of financing affordable, ecological housing is the project of “City quartier Güterbahnhof” in the German city of Tübingen. 93 out of the 157 flats belong to social housing. These are rent-controlled for 25 years and are priced one-third below the rent index. They are only available to tenants with a housing entitlement certificate.

One-third of the subsidized flats were occupied by unemployed people, another by single parents with children, and the last third by student families. The freely financed flats are also offered at rents below the market level. The construction project meets not only the social but also the ecological requirements of UmweltProjekt AG: all flats require only 40 percent of the energy of a comparable existing building.

100% renewable energy

UmweltBank pursues the vision of “100 percent renewable energy” through financing projects in the field of renewable energy. All financed projects support the transition to a carbon-neutral sustainable economy. UmweltBank’s current largest investment to date in energy projects, regarding the installed capacity, is the “Solar park Schornhof” near the city of Ingolstadt.

It is currently the largest solar park in Bavaria with an installed capacity of 120 MWp, whereof 90 MWp are Power Purchase Agreement-backed. The CO2 savings of the project amount to 82,000 tonnes.

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