KiwiRail has secured a $350 million loan facility to fund the purchase of two new inter-island ferries. The loan is the first in the world to be certified by the Climate Bond Initiative.
The Climate Bond Initiative is a global scheme that uses rigorous scientific criteria to determine whether loans and other debts are consistent with the goals of the Paris Climate Agreement.
To gain the certification, KiwiRail demonstrated a clear path to achieving zero carbon emissions by 2050.
“These ferries are making a 50-year advance in technology. We’re going from ferries which are well over 20 years old, to state-of-the-art, future-proofed ferries which will last 30 years, and carbon emissions reduction has been a big part of the design,” said KiwiRail Group Chief Executive Greg Miller.
The new ferries will achieve a 40% reduction in carbon emissions relative to the current ferries by operating on a combination of diesel, battery power and shoreside electrical power. In addition, they have been designed to allow for an increase in battery use over time, with the idea that they could be run entirely on electricity in the future. The design also allows for the use of alternative low-carbon fuel sources as they become commercially available.
Climate Bonds Initiative CEO Sean Kidney welcomed the loan certification.
“Rapid decarbonisation of transport is vital for emissions reduction, with shipping being a critical part of the sector. This world-first Certification for shipping by KiwiRail and their partners marks the adoption of international best practice for green finance and they are to be congratulated.”
The new ferries are being built by Korean shipyard Hyundai Mipo Dockyard. The first arrives in 2025 and the second in 2026.
