Czech utility group CEZ has negotiated its third sustainability-linked loan connected to ESG rating. The credit line provided by the CaixaBank branch operating in the Polish market amounts to 2.5 billion crowns (approximately 98.6 million euros). As in the case of the two previous credit agreements, if CEZ meets its decarbonisation commitments in the coming years, it will obtain a more favourable interest rate at draw-down, whereas if its ESG parameters deteriorate, its interest rate will jump up. In terms of sustainability, CEZ Group is currently among the top 13 per cent best-rated publicly traded companies in the world.
“Credit lines linked to specific ESG targets, such as reducing emission intensity, are already the standard offered by an increasing number of banks and other financial institutions,” said Martin Novák, Member of the Management Board and head of the Finance Division. “At CEZ, we have implemented a very robust decarbonisation strategy. We are the first Czech company to boast international validation of our climate targets by SBTi. Consequently, we will want to use this type of borrowing with increasing frequency. The line closed with CaixaBank belongs to our portfolio of committed credit backup lines. Reference to ESG rating was chosen with a view to the short timeframe of the credit line.”
The credit parameters of the loan are based on the rating established by a leading international ESG rating agency.
In 2021, CEZ presented its business strategy Clean Energy for Tomorrow based on ESG pillars. Decarbonisation of the energy production portfolio, reduction of greenhouse gas emissions as well as other pollutants and achieving net zero by 2040 are key aspects of the environmental pillar. Last year, CEZ Group reduced its emission intensity by 8 per cent year on year.