E1-3 – Actions and resources in relation to climate change policies
Classification and management logic
Building on the strategies described in E1-2 and the transition plan in accordance with E1-1, Rentenbank implements its climate goals through a structured portfolio of actions. This includes actions in its own operations as well as actions in the promotional and lending business aimed at reducing financed emissions and supporting the transformation of agribusiness.
As a promotional bank, Rentenbank’s promotional business is predominantly indirect: It manages its climate impacts not through individual project decisions, but through the programmatic design of its promotional instruments (promotional purposes, terms, incentives, maturities, eligibility requirements and exclusion criteria). Investments are carried out by ultimate borrowers through the on-lending principle. This means that climate impacts materialise with a time lag and depend on sectoral and operational framework conditions.
Rentenbank reviews its portfolio of actions at least annually as part of its strategy processes and programme planning. Progress towards the goals is tracked using the metrics presented in E1-4 and the emissions accounting in accordance with E1-6.
Actions
The climate-related actions are structured in line with the emission scopes and address the key areas for action:
In banking operations, the focus is on reducing own emissions by improving energy efficiency, decarbonising the heat supply, electrifying the vehicle fleet and ensuring low-emission electricity procurement.
In the promotional and lending business, the product range and the applicable terms are used to incentivise investments that reduce emissions and to promote nature-based solutions. Financing renewable energy and climate-relevant infrastructure, as well as strengthening innovation in agribusiness, significantly expands our contribution to climate change mitigation. In addition to climate change mitigation, the credit portfolio also supports measures that contribute to climate change adaptation and thereby reduce risks.
Actions in banking operations
Rentenbank implements climate change mitigation actions in its banking operations primarily through the levers of electrification, decarbonisation of the heat supply and procurement of renewable electricity. The actions are monitored continuously through annual GHG accounting. The key individual actions, their implementation status and their expected impact on emissions are shown in the table below:
| Decarbonisation lever | Action | Goal & expected effect | Status |
|---|---|---|---|
| Electrification | Electrification of the vehicle fleet | Reduction of direct emissions from fuel consumption | ongoing (target: 40% by 2027) |
| Heat supply | Connection to district heating | Long-term reduction of heat-related emissions | planned |
| Procurement of climate-friendly heat | Use of waste heat and renewable sources | planned | |
| Renewable energy | Purchase of green electricity | Avoidance of market-based Scope 2 emissions | implemented |
Electrification of the vehicle fleet
Rentenbank reduces direct emissions from the vehicle fleet by continuously converting pool and tradespeople’s vehicles to electric or hybrid drives. The goal is to achieve a share of 40% electrically powered vehicles by 2027. This action has a direct effect on Scope 1 emissions from fuel consumption.
Heat supply
As part of the core refurbishment of the main site, the existing gas-based heat supply will be replaced by a connection to district heating. This is expected to significantly reduce heat-related emissions over the long term. The future level of emissions will, however, depend on the decarbonisation of the district heating mix. Until this measure has been implemented, fossil heat consumption in banking operations will be recorded only for the temporary building.
The planned district heating connection at the refurbished main site is also expected to significantly reduce heat-related emissions, as Rentenbank’s heat supplier intends to achieve net climate neutrality by 2040. Achievement of this goal is therefore not entirely within Rentenbank’s sphere of influence.
Renewable energy
Rentenbank sources 100% of its electricity from certified renewable sources. This avoids market-based Scope 2 emissions; location-based emissions are reported separately in accordance with the standard.
Actions to reduce financed emissions
The main climate-related impacts of Rentenbank arise from the financed emissions of its promotional and lending business. As a promotional bank, Rentenbank addresses these matters through the programmatic design of its promotional instruments.
Key actions include interest-based incentives, grants and strategic initiatives that support investment in lower-emission technologies, nature-based solutions, innovation and renewable energy. The measures are aimed at initiating transformation processes in the agricultural, food and rural energy sectors. The objective is to support ultimate borrowers in reducing their GHG emissions over the long term by enabling sound investment decisions.
The table below provides a structured overview of the key actions to reduce financed emissions and assigns them to the respective decarbonisation levers:
| Decarbonisation lever | Action | Goal & expected effect | Status |
|---|---|---|---|
| Incentivising sustainable investments | Preferential terms (currently 20 bp discount on the standard rate) | Promotion of low-emission technologies, energy efficiency and sustainable production methods in primary agricultural production | ongoing |
| “GHG inventory” interest bonus (25 bp) | Incentive to prepare company GHG inventories as a basis for systematic emissions reduction | ongoing | |
| Nature-based Climate Action Programme | Promotion of soil-conserving cultivation, humus formation and carbon storage | limited until 12/2026 | |
| Data basis & emissions control | “GHG inventory” grant | Reduction of transaction costs associated with the introduction of operational GHG accounting | limited until 12/2026 |
| Innovation and transformation | Premium terms (currently 40 bp discount on the basic rates) | Targeted promotion of particularly climate-effective areas of innovation (e.g. agroforestry, paludiculture, agri-PV) | ongoing |
| Promotion of innovation in agribusiness | Development and scaling of lower-emission, resource- efficient and resilient technologies | ongoing | |
| Renewable energy | Financing of the energy transition in rural areas | Expansion of renewable energy, storage solutions and grid integration | ongoing |
| Strategic initiatives | WALD initiative | Mobilisation of private capital for nature-based contributions to climate change mitigation and market mechanisms | ongoing |
Incentivising sustainable investment
In its special promotional loans, Rentenbank uses a system of terms linked to investment purposes in order to promote specifically those investments that contribute to climate change mitigation and resilience.
Preferential terms for sustainability
In the sustainability programme, investments in precision farming, energy efficiency and other sustainable uses or soil-conserving cultivation equipment are incentivised through preferential terms. The measure is aimed at reducing emissions and increasing efficiency in primary agricultural production and is subject to an interest rate discount of currently 20 basis points compared to the base rate.
“GHG inventory” interest bonus
Rentenbank provides an interest rate incentive of 25 basis points compared to the respective programme terms for the preparation of corporate green-house gas accounts. The aim is to provide targeted support to companies that have already embarked on the path to decarbonisation. At the same time, the interest bonus is intended to encourage investing companies to prepare a GHG inventory and thereby engage with the management of their own emissions.
Nature-based Climate Action Programme
The programme promotes nature-based measures, including soil-conserving cultivation, humus formation and carbon storage. Funding is provided in the form of grants from federal funds and supplementary subsidised loans.
Data basis & emissions control
“GHG inventory” grant
A grant provided by Rentenbank supports the preparation of GHG inventories for agricultural businesses in order to reduce the market entry and transac-tion costs associated with GHG accounting. In this way, we seek to encour-age ultimate borrowers to prepare a GHG inventory and identify the reduction potential on their farms. The grant amounts to up to EUR 1,000 and is conditional upon proof of the undertaking’s carbon footprint and a list of measures. It is intended to encourage undertakings to prepare an initial GHG inventory.
Innovation and transformation
Premium terms for “Focus on future fields”
Areas of innovation with a particularly strong climate impact are supported through more favourable terms of up to 45 basis points below the standard rate. Examples include agroforestry, paludiculture, agrivoltaics, and environmentally friendly or automated cultivation methods.
Promotion of innovation in agribusiness
Rentenbank strengthens climate-relevant innovation along the agribusiness value chain through instruments such as research funding, subordinated loans for start-ups and investments in venture capital funds. The aim is to develop and scale resource-efficient, low-emission and resilient solutions.
Financing of the energy transition in rural areas
Rentenbank finances investments in wind, photovoltaic and bioenergy plants, storage technologies, and infrastructure for distribution and grid integration. An interest rate discount is granted for selected storage and distribution projects. The funding thus contributes to the decarbonisation of Germany’s energy supply.
Strategic initiatives
Rentenbank is involved in strategic initiatives aimed at strengthening nature-based contributions to climate mitigation and developing suitable market mechanisms, for example as part of the WALD initiative. The aim is to mobilise private capital to strengthen natural ecosystems and reward ecosystem services that contribute to climate change mitigation. The status of further development, for example through feasibility studies and further conceptual work, is tracked transparently as part of the annual update.
Financial resources
The implementation of individual actions requires differing levels of financial resources. This applies in particular to the promotional business, where actions are implemented primarily through preferential terms and the provision of subsidised loans or grants. The use of financial resources is determined at programme level and reflected through the respective promotional instruments. It does not represent Rentenbank’s own investments or expenses. Accordingly, there is no separate allocation of capital expenditure or operating expenditure.
Results and expected emission reductions
As a general rule, Rentenbank reports the results of its climate change mitigation actions on the basis of emissions trends and the target system. For actions in banking operations, the direction of impact can be identified directly, for example in the case of the electrification of the vehicle fleet, the decarbonisation of the heat supply or the purchase of green electricity.
For the promotional business, however, a granular quantitative allocation of individual promotional instruments to specific emission reductions is only possible to a limited extent. The main reasons for this are the high complexity and biological variability of agricultural emission processes, the heterogeneous starting positions of borrowers at farm level, and the time-lagged effects of investments and nature-based measures.
In addition, the collection of sustainability data is difficult to implement across the board owing to the small average size of farms and the on-lending principle. A first step towards improving data quality has been taken through the grant for the preparation of GHG inventories and the related interest bonus.