Office of Environmental and Energy Coordination

Fairfax County, Virginia

CONTACT INFORMATION: Our office is open to visitors by appointment only. Please call or email from 8:30 a.m. - 5:00 p.m., Monday through Friday.

TTY 711

12000 Government Center Pkwy, Suite 533
Fairfax, VA 22035

John Morrill,
Acting Director

Green Financing On The Rise

The financial sector is now peppered with a variety of “green” financing tools, with total sustainable debt issuance exceeding $1 trillion in 2019. Depending on your objectives and values, certain financial instruments may make more sense for you than others. Read on for a brief survey of the most established and popular sustainable financing vehicles available today.

Green Bonds

Since 2007, green bonds have been issued to finance climate change mitigation, clean energy and other environmentally centered projects and initiatives. As of 2018, the global value of green bonds was upward of $165 billion, more than 100 times greater than their value a decade earlier. In 2015, the Town of Vienna became the first municipality in Virginia to issue a green bond, to help finance the renovation of the Vienna Community Center which earned Leadership in Energy and Environmental Design (LEED) Silver.

In recognition of the growing popularity of these debt instruments, the International Capital Market Association has published Green Bond Principles to guide issuers and investors participating in the green bond market. Examples of projects financed using the proceeds from green bonds include the development of smart grids, soil remediation, support for environmentally sustainable agriculture, installation of infrastructure for clean energy vehicles, green building development, and more.

In addition to green bonds, sustainability bonds are gaining in popularity and are defined by the mixture of environmental and social benefits their proceeds provide.


Tied specifically to the construction and improvement of buildings, Commercial Property Assessed Clean Energy (C-PACE) programs are designed to incentivize energy- and water-saving measures. The Fairfax County C-PACE program is the first in Virginia to also include resiliency, allowing commercial property owners to make improvements to combat risks due to flooding, high winds or extreme temperatures using this innovative financing tool.

With C-PACE, property owners can finance sustainability and resiliency projects within their buildings and sites using long-term private loans with little or no up-front cost. The loans transfer with the property and are repaid via a property tax assessment. This lending model is used in communities across the United States and has fostered the sustainable development of projects of all sizes, including the construction of Audi Field in Washington, DC.

Sustainability-Linked Loans

Also known as ESG-linked (Environmental, Social, Governance) loans, these financial vehicles are tied to the sustainability performance of the borrower. Relatively new to the scene, the terms of these loans are dependent on a borrower’s performance based on a variety of environmental, social and governance metrics defined and evaluated by a third-party validator. In their first full year on the market, sustainability-linked loans saw a 677 percent increase in value, topping out at $36 billion.

Because sustainability-linked loans are not tied to the realization of specific projects like green bonds, some consider them a potential public relations liability, subject to greenwashing accusations. At the end of the day, the objectives of the two are different and sustainability-linked loans are intended to drive borrowers to improve their ESG performance holistically over time. With proper transparency and accountability measures in place, sustainability-linked loans can be an ideal fit for many companies. The Loan Market Association has issued guidance to lenders and borrowers to help clarify the proper issuance and use of these loans.

Are you pursuing sustainability goals and targets within your business? Let us recognize your great work – join the Fairfax County Green Business Partners program today.

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