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The amount of Eligible Green Expenditure to be matched by potential Green OAT issuance (OAT 1.75% 25 June 2039) will be €8bn in 2018.
As was announced in the 2018 Indicative State Financing Programme published last month, the Green OAT will be tapped to meet investor demand and ensure a liquid market, within the limits of Eligible Green Expenditure.
There are two sources of Eligible Green Expenditure for 2018:
- The residual amount of Eligible Green Expenditure defined for 2017 that was not matched to Green OAT issuance in 2017 and still complies with the Green OAT framework defined at the time of issuance1. This amount stands at €3bn in 2018;
- New fiscal and tax expenditure in 2018 that complies with the framework defined at the time of issuance. This amount stands at €5bn.
The Green OAT 1.75% 25 June 2039, issued one year ago today, will continue to contribute to the financing programme defined in the 2018 Initial Budget Act, as will the other OAT issues. Outstanding Green OAT debt now stands at €9.7bn.
Furthermore, reports on the allocation of expenditure actually matched by Green OAT issuance in 2017 and the related performance indicators will be published at the end of the first half of 2018, after the 2017 Budget Review Act. This Act is the budget legislation that sets the definitive amounts of central government expenditure and revenue at the end of the fiscal year, along with the resulting fiscal balance.
Framework for Eligible Green Expenditures
In keeping with the commitments that France made in its Energy Transition and Green Growth Act, which implements the Paris Climate Agreement, the proceeds of France's Green OAT will be matched to central government budget expenditure and expenditure under the “Invest for the Future” programme to fight climate change, adapt to climate change, protect biodiversity and fight pollution.
The criteria for selecting Eligible Green Expenditure were defined before the first Green OAT issue. Samples of eligible projects were made public, and provided to investors in a framework document published on 10 January 2017, which can be found on the AFT website.
The projects that represent Eligible Green Expenditure are identified beforehand each year by an interministerial steering committee that works under the aegis of the Prime Minister.
Agence France Trésor (AFT)
+33 1 40 04 15 50
1Fiscal and tax expenditure in a given year that has not be matched to Green OAT issuance in the following year is no longer Eligible Green Expenditure in later years.