Accessing funding for high quality BRT just got easier. This year, the Climate Bonds Initiative (CBI) adopted the ITDP BRT Standard as the official criteria for certifying BRT projects as eligible for Climate Bond financing, a move that can help attract new funders to high quality projects. Now, to be eligible for the certification under the Climate Bonds Standards, a BRT project must rank as a Gold, Silver, or Bronze. A certified project lets investors know that the project is both a sound investment and climate friendly, which helps ensure that funding for bus rapid transit is focused on systems that will deliver strong environmental benefits.
Bus rapid transit can take cars off roads and reduce emissions, and it can often do it faster, cheaper and easier than light rail or metro. But to bring these benefits, BRT has to have the right features. High quality design elements, including dedicated lanes and preferential intersection treatment, are necessary to make BRT an effective climate change solution, as well as an efficient transit system. The importance of assuring high quality BRT underpins the BRT Standard, which defines a common understanding of what constitutes high quality BRT.
The Climate Bond Standard Board, which sits above the Low Carbon Transport Technical Working Group, has approved criteria for Climate Bond certification for bus rapid transit projects. The criteria states that “the components of any BRT project meeting Bronze, Silver, or Gold Standard under the ITDP BRT Standard … will be eligible for certification under the Climate Bonds Standards.”
The Climate Bonds Initiative is a non-profit organization focused on mobilizing bond markets to address climate change. By certifying projects, from wind farms to smart transit, CBI assures potential funders that the projects offer “the same returns as other bonds, but with the added benefit that funds are only going to climate change solutions”. This system makes financing for climate friendly projects more available, and assures investors their funds are being used for projects that address climate change.
According to the CBI criteria, “high quality BRT has been shown to be associated with the improvement of bus travel speeds and reliability and the smoothing of traffic flows, leading to greater mode shifting and reduced greenhouse gas (GHG) emissions”.
The ITDP BRT Standard is a design guide and evaluation tool for identifying systems that can deliver the environmental benefits of BRT. In approving the BRT Standard as the criteria for Climate Bond certification, CBI can direct significant investment in the coming years to high quality BRT. According to CBI´s State of the Market Report for 2015, the climate and green bond market has an estimated value of $597.7 billion, and that number is growing.
“Climate Bond financing will help promote the more rapid scale-up of high quality BRT systems worldwide,” said Michael Replogle, ITDP Founder and Board member. “Just as motor vehicle and fuel standards have driven progress in fuel economy and pollution reduction, the BRT Standard linked to Climate Bonds will help ensure that BRT system development and investments in related bonds deliver maximum benefits for passengers, operators, and the environment.”
ITDP has long worked with institutional funders and policy setters, advocating for greater focus and funds to be directed toward low carbon transit projects, including BRT. Organizations including the Global Environment Facility (GEF) and many multilateral development banks have taken similar actions to raise the profile of low carbon transit. At the Rio+20 Summit in June 2012, eight of the world’s largest MDBs pledged to direct $175 billion for more sustainable transit over the next decade, and have continued to make progress toward that goal. By adopting the ITDP BRT Standard as the Climate Bond Criteria, the Climate Bond Initiative helps focus development funding on BRT projects that will deliver strong environmental benefits.