Hawke's Bay airport

Hawke's Bay Airport has taken an important step in its ambition to become New Zealand's most sustainable airport, by accessing a $23 million sustainably linked loan from ASB. It's allocated under the Reserve Bank's Funding for Lending (FLP) programme, to support projects that meet sustainability or regional infrastructure criteria.

Sustainability at the heart of everything 

As a vital strategic asset for the Hawke's Bay region, the airport has a stated aspiration of being New Zealand's most vibrant and successful regional airport.

Hawke's Bay Airport CEO Rob Stratford says, 'being ASB's first Sustainable Linked Loan partner reflects confidence in our banking partner and our overall vision and strategic plan. The fact is, getting to this point indicates a high degree of rigour and verification as well as confidence in our commitment to sustainable outcomes'. 

Nigel Annett, ASB's executive general manager for Corporate Banking, agrees. 'We're delighted to partner with Hawke's Bay Airport in our first Sustainability Linked Loan to support them as they work towards a more sustainable, resilient 'low carbon' future while also focusing on regional growth.'

The airport demonstrates its commitment with various initiatives, including switching to 100% renewable and CarboNZero-certified electricity, using electric and hybrid vehicles, adding a Bikeport to connect to cycleways, and working with Biodiversity Hawke's Bay to improve wildlife habitats across the region.

The benefit of sustainable loans

Sustainability Linked Loans (SLLs) require the borrower to commit to key environmental, social and, governance (ESG) targets, with borrowing costs adjusted based on their performance against these targets. 

There are three main benefits:

• The loan rates can be lower than other banking products.
• Improving sustainability aligns with the government carbon zero target by 2050.
• It provides an incentive to accelerate what all businesses will need to address eventually and puts in place ESG structures, processes and outcomes that are independently certified. 

Recent awards

The success of Hawke's Bay Airport's vision was recognised at the 2022 NZ Airports , winning the Medium Airport of the Year, Sustainability Initiative and Airport Community Engagement awards. The breadth and depth of the airport's decarbonisation and sustainability plans, biodiversity, and involvement of all stakeholders, including local iwi, was seen as an exemplar in the industry. 

Setting targets 

To remain eligible for the SLL loan, conditions are set to demonstrate the year-on-year reduction in carbon emissions, as well as working with tenants, partners and stakeholders to collect emissions data including electricity usage, waste to landfill and use of fossil fuels.

The airport will be rewarded or penalised with lower or higher borrowing costs, depending on whether it hits its targets.

Rob says the business is working on numerous carbon and waste reduction initiatives, including a pledge to reach net zero emissions by 2030 and progressing the next steps of a major solar farm by the runway. Partnering with ASB to access FLP funds allows the airport to continue its ambitious programme of sustainability work, which is critical to its future success. 'It's vital that Hawke's Bay Airport continues on its drive towards sustainability leadership, a focus that is intrinsic to our businesses success moving forward,' says Stratford.

More than 330 airports worldwide are actively addressing carbon emissions in the Airport Carbon Accreditation programme, including London's Heathrow and Gatwick airports and Amsterdam's Schiphol Airport. It includes six levels: mapping, reduction, optimisation, neutrality, transformation and transition. 

ASBs commitment 

ASB is playing its part in mobilising capital to help grow a greener economy, which aligns to the Climate Change Commission's view on the critical role of New Zealand's financial sector. 'We are committed to working alongside our customers to help them transition to a low emissions economy. Hawke's Bay Airport is showing real leadership in holding themselves to account for ambitious targets', says Nigel.

ASBs own sustainability goals include maintaining Toitu carbon zero certification, to prove action is being taken on climate change. Ambitious science-aligned targets to reduce operational emissions are in line with the Paris Agreement. Recent sustainable finance initiatives include the Rural Sustainability Loan to support farmers' environmental goals, and Back My Build to incentivise new energy-efficient home construction.