As an energy and infrastructure specialist, Kommunalkredit is bridging the needs of sponsors and investors across a wide spectrum of products that includes public finance, financial advisory, corporate finance, acquisition and leverage finance, export finance and project finance. They also deliver asset management via the Fidelio KA Infrastructure Debt Fund platform and equity financing for project developments via the KA Development vehicle.
Global trends driving infrastructure investments include climate change, demography, digitalisation, globalisation versus regionalisation and the increased relevance of communication in agile working and distance learning. The bank is proud to actively contribute to 14 of the UN’s 17 Sustainable Development Goals (SDGs) and to promote the ESG ambitions of the European Union. They are growing and attracting talent, supporting new projects and directly addressing demand from borrowers, developers, operators, the public sector and institutional investors for sustainable and responsible investment opportunities.
“We have a real focus on creating a better world by enabling the development of sustainable infrastructure, combining sustainable and responsible investments with attractive returns”, says Kommunalkredit CEO Bernd Fislage.
2021 was a challenging year with a stop-and-start strategy depending on the pandemic’s impact on the economy, but both the EU Green Deal and the pandemic brought opportunities. A number of extreme weather events highlighted the need for sustainable infrastructure, while the impact of covid put the spotlight on hospitals and other public infrastructure and the paradigm shift in business behaviours drove demand for digital infrastructure. The financial industry has a lot of leverage here, with the multi-faceted layers of stakeholders driving finance towards sustainable and innovative projects that fight climate change and drive the transition to decarbonisation forward.
In times that are very challenging on an economic, political and, above all, humanitarian level, Kommunalkredit has expanded its leading role as a specialist in infrastructure and energy financing as well as public finance with its resilient and sustainable business model. Despite macroeconomic changes, not least as a result of the COVID-19 pandemic, low interest rates and rising inflation, the bank’s strong performance in the 2021 financial year proves once again that the financing and implementation of innovative projects in the areas of hydrogen, green and sustainable energy production and storage, e-mobility, digital communication and data centres as well as social institutions are essential to the community. This is also a testament to the resilience of the European market for infrastructure financing, which achieved a record volume of nearly EUR 300bn despite the considerable impact of the health crisis. Kommunalkredit responded quickly to the varied challenges, especially by focusing more on digitalisation & communication in light of working from home, distance learning and a secure and reliable energy supply. About 80% of the projects implemented in 2021 are related to these areas. With a new business volume in infrastructure and energy financing of EUR 1.9bn (2020: EUR 1.1bn), they have further expanded their position in the European infrastructure market.
They have supported the realisation of 46 infrastructure projects in 2021: from wind power plants in Scandinavia, broadband expansion in the Netherlands, solar photovoltaic parks in Southern Europe, fibre-optic projects in Germany, health infrastructure in the United Kingdom and many more.
However, Kommunalkredit operates not only in Europe and beyond, but also supports pioneering initiatives in the Austrian domestic market. They are investing in the construction of the largest electrolysis plant in Austria jointly with OMV, where up to 1,500 tonnes of green hydrogen will be produced annually from 2023 onwards, thus reducing CO2 emissions by up to 15,000 tonnes annually. Another lighthouse project is their joint venture “PeakSun” with the Upper Austrian energy supplier eww, to finance, assemble and operate photovoltaic rooftop systems on commercial real estate. That joint venture uses a contracting model, which means that people don’t need to buy solar panels for their rooftops, with the company instead financing those and then leasing them to customers on a long-term basis. Customers receive all the electricity generated by the system and can either use it in their own building or feed it into the public power grid. With this model, they are able to deliver energy below the current price without subsidies, which is more attractive than ever simply because of the very high and volatile energy prices we currently face.
Their activities have a clear focus: sustainability in accordance with ESG (Environment, Social, Governance) and SDG (Sustainable Development Goals) criteria. The issue of sustainability is part of our DNA. Sustainable management – i.e. operating responsibly in economic, social and ecological terms – is the basis for their business model. The infrastructure and energy projects they have helped implementing contribute to decarbonisation, national and international climate targets and the European Union’s (EU) Green Deal. They also take their socio-political responsibility and role as a pioneer seriously: Kommunalkredit was the first Austrian financial services provider with EMAS certification, the first Austrian issuer of a social covered bond and the first Austrian bank in the European Clean Hydrogen Alliance. They have also joined the UN Global Compact sustainability initiative in the last year.