The bankers have done their sums. According to Sean Kidney, CEO of the Climate Bonds Initiative, we need to spend $6 trillion a year on climate change action or we will never overcome the challenge.

To most of us this amount of money is simply incomprehensible. Couldn’t we just buy Australia for that amount of money? But to the banks it can be done. You see, the finance markets trade about $60 trillion every year. Shifting this market so that only 10 per cent goes towards climate change action is not such a big challenge to them.

The way to do this is through green bonds. Green bonds finance green infrastructure such as water sustainability, energy efficiency and a host of community resilience projects. It’s basically like getting a loan at a cheaper interest rate than you might get from a bank or other financial institution.

There are superannuation funds, banks and sovereign governments who want to buy these green bonds. They want to invest in sustainability. And it seems the world can’t produce these bonds fast enough. Every time a green bond is put on the market there are far more buyers than there are available bonds.

So if all this money is available, how do I get some?

The challenge is that green bonds have to be a decent size, at least $50 million and preferably up to $500 million. There are not many community scale projects that hit those sorts of numbers. So the thing to do is aggregate projects.

You need to pool a bunch of projects together that add up to a decent amount. These projects can be across councils and communities that together create an attractive package of sustainability and community resilience.

What do you think about getting cheap finance from a superannuation fund for your projects?
How do you think we can aggregate projects into something that is large enough to issue a green bond?

Want to know more: www.climatebonds.net

You can download a presentation on Climate Bonds here.