EGA adopts 'green finance framework'

EGA has published its Green Finance Framework to support decarbonisation projects and initiatives that contribute to a low-carbon economy. The company also announced that its recent acquisition of the European specialty foundry Leichtmetall was fully financed through EGA’s first green loan facility.

The Green Finance Framework outlines eligibility and governance mechanisms for financing from third-party institutions and funds that prioritise sustainability in their capital allocation, among other sources.

By publishing this framework, EGA advances its sustainability goals by accessing a broader range of funding options for loans and bonds. This can potentially lower borrowing costs and ensure greater transparency.

Citi and ING served as the lead sustainability structuring banks, while First Abu Dhabi Bank (FAB) acted as the sustainability structuring bank to assist EGA in developing the framework.

EGA has publicly committed to achieving net zero greenhouse gas emissions by 2050, aligning with the UAE Net Zero by 2050 strategic initiative.

Global demand for aluminium is expected to grow by 50% to 80% by 2050. Recycled and low-carbon primary aluminium are anticipated to account for about 60% of supply growth between now and 2030, and approximately 70% between 2030 and 2040.

EGA completed the acquisition of Leichtmetall in May. Leichtmetall uses renewable energy to produce up to 30,000 tonnes of aluminium billets annually at its German plant, with secondary aluminium comprising about 80% of the input material.

Abdulnasser Bin Kalban, CEO of EGA, said, “The aluminium EGA produces plays an essential role in the development of a more sustainable society. It is also important how sustainably it is produced. This is both an enormous opportunity and a significant challenge for EGA and our wider industry. Our Green Finance Framework enables us to access a deeper pool of liquidity to finance projects and initiatives that advance our decarbonisation goals. Our use of green financing for our recent acquisition of Leichtmetall is another first for EGA in our sustainability journey.”