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In June 2025, Australia reached a major milestone in the development of its sustainable finance architecture with the release of Version 1 of the Australian Sustainable Finance Taxonomy.
Led by ASFI through a shared Government-industry partnership, and informed by the Sustainable Finance Roadmap, broad-based collaboration and extensive public consultation, the Australian taxonomy established a common capital allocation framework aligned with the objectives of the Paris Agreement and tailored to Australia’s path to net zero.
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Supporting practical market adoption
Successful market uptake of the taxonomy is critical to mobilising private capital into activities that will decarbonise the Australian economy in line with the Government’s 2035 emissions reduction target.
“Australia’s Sustainable Finance Roadmap provides a clear reform pathway to mobilise the private capital necessary to finance the net zero transition. The Sustainable Finance Taxonomy provides a common language for green and transition finance in Australia, supporting the allocation of capital towards activities that enable Australia’s net zero ambitions”
– Australian Government, Australia’s Net Zero Plan (2025)
ASFI’s targeted approach to supporting market uptake has been deliberate. International experience shows that voluntary taxonomies can have limited uptake where there is a lack of ongoing engagement and guidance to bridge development and implementation phases.
For this reason, ASFI has partnered with financial institutions to deliver a world-first taxonomy implementation program comprising two streams; implementation pilots and debt guidance.
Taxonomy Implementation Pilots
ASFI collaborated with 11 financial institutions to test the practical application of the Australian taxonomy across different use cases and asset classes.
“During the [pilot] program, we saw how useful the taxonomy could be in providing a ready-made set of criteria for defining green and transition-related activities that were credible and practical”
– Clean Energy Finance Corporation
Australian Taxonomy Aligned Use-of-proceeds Debt Guidance
ASFI worked with representatives of Australian Treasury, the Australian Office of Financial Management and Australia’s semi-sovereign agencies to develop practical debt guidance covering for issuing use-of-proceeds debt aligned with the Australian taxonomy.
Application of the Australian Taxonomy
One year after its release, the Australian taxonomy is already being applied across labelled debt, capital allocation frameworks and investment decision-making processes, with at least 11 publicly reported uses to date.
The most common publicly disclosed use of the Australian taxonomy has been to define eligible activities within use-of-proceeds debt and capital allocation frameworks.
“Over time, the [Australian] Taxonomy can support the banking sector by providing a clearer and more consistent basis for assessing sustainable finance opportunities. That can improve comparability across the market and reduce the need for each institution to develop separate approaches.”
– ANZ
Through the taxonomy implementation pilots, participating institutions have also applied the taxonomy as a tool to inform investment decisions, assess real asset performance, support stewardship, evaluate portfolio performance, and inform due diligence on environmental and social risks.
“The taxonomy is a valuable tool for investors and governments, private and public sector, policy makers and corporates. When adopted broadly, it will result in a universal language and a shared framework that links different parts of the capital value chain”
– HESTA
Publicly reported uses of the Australian Taxonomy
Publicly reported uses of the Australian taxonomy to date are summarised below.
Victoria Power Networks (VPN)
Taxonomy use:
VPN utilised the Australian taxonomy to identify eligible activities to be financed by proceeds raised from the issuance of its inaugural A$750m green bond in October, 2025.
Taxonomy alignment:
Eligible activities under VPN’s Sustainable Financing Framework are aligned with Australian taxonomy TSC including:
– D7. Storage of Electricity, and
– D10. Transmission and Distribution of electricity
Meridian Energy
Taxonomy use:
Domiciled in New Zealand, Meridian Energy utilised the Australian taxonomy to identify eligible activities to be financed by proceeds raised from its issuance of A$400m fixed rate green medium-term notes.
Taxonomy alignment:
Eligible activities under Meridian Energy’s Green Finance Framework are aligned with Australian taxonomy TSC including:
- D1. Energy Generation from Solar Photovoltaic (PV) and Concentrated Solar Power (CSP)
- D2. Energy Generation from Onshore and Offshore Wind
- D4. Energy Generation from Hydropower
- D10. Transmission and Distribution of Electricity
- D7. Storage of Electricity
Igneo Infrastructure Partners
Taxonomy use:
Igneo Infrastructure Partners utilised the Australian taxonomy to screen assets and inform eligible activities to be financed via a A$185m green tranche credit facility that was established for its Australia New Zealand Diversified Infrastructure Fund.
Taxonomy alignment:
Igneo Infrastructure Partners’ Green Financing Framework is not publicly available. A media release concerning the use of the taxonomy can be found here.
Brighte Capital
Taxonomy use:
Brighte Capital utilised the Australian taxonomy to inform the selection of eligible consumer receivables to be repackaged into an asset-backed security in the form of a A$200m securitised green bond issued by Brighte Green Trust.
Taxonomy alignment:
Eligible activities under Brighte Capital’s Green Financing Framework are aligned with the Australian taxonomy TSC including:
- D1. Energy Generation from Solar Photovoltaic (PV) and Concentrated Solar Power (CSP).
- D2. Energy Generation from Onshore and Offshore Wind Solar energy generation
- D7. Storage of Electricity Energy storage, including batteries Appliances and products, including solar inverters
- I1. Road Passenger Transport
- I14. Low-carbon Road Transport Infrastructure
Treasury Corporation Victoria (TCV)
Taxonomy use:
TCV utilised the Australian taxonomy to identify eligible expenditures that may be financed or refinanced through the issuance of green, social or sustainability bonds under its Sustainable Bond Framework.
Taxonomy alignment:
Eligible expenditures under TCV’s Sustainable Bond Framework are aligned with the Australian taxonomy TSC including:
- D1. Energy Generation from Solar Photovoltaic (PV) and Concentrated Solar Power (CSP)
- D2. Energy Generation from Onshore and Offshore Wind
- D4. Energy Generation from Hydropower
- D6. Energy Generation from Bioenergy
- D7. Storage of Electricity
- D10. Transmission and Distribution of Electricity
- E1. New Construction
- E2. Acquisition and Ownership
- E5. Renovation and Upgrades
- I2. Road Passenger Bus Transport
- I8. Urban and Suburban Passenger Rail Transport
- I14. Low-Carbon Road Transport Infrastructure
Bank Australia
Taxonomy use:
Bank Australia utilised the Australian taxonomy to inform the selection of eligible loans provided by the bank to be funded by proceeds generated by the issuance of wholesale sustainability bonds and retail impact term deposits.
Taxonomy alignment:
Eligible loans under Bank Australia’s Sustainable Funding Framework are aligned with Australian taxonomy TSC including:
– E1. New Construction
– E2. Acquisition and Ownership
– E3. Renovation and Upgrades
– E5. Renovation and Upgrades
– E6. Manufacturing and Supply of Goods
– E7. Supporting Infrastructure
SA Power Networks
Taxonomy use:
SA Power Networks utilised the Australian taxonomy to identify eligible activities to be financed by proceeds raised from the issuance of its A$300 million 5 year Green bond.
Taxonomy alignment:
Eligible activities under SA Power Networks’ Sustainable Financing Framework are aligned with the Australian taxonomy TSC, DNSH and MSS criteria for activities within the Electricity Generation and Supply sector.
Western Australian Treasury Corporation (WATC)
Taxonomy use:
WATC utilised the Australian taxonomy TSC to screen the alignment of eligible expenditures its green bond project pool against.
Taxonomy alignment:
At least 95 per cent of eligible expenditures on climate mitigation projects within WATC’s green bond project pool were aligned with the Australian taxonomy TSC.
Australian Retirement Trust (ART)
Taxonomy use:
ART utilised the Australian taxonomy TSC to set and report a target for climate-related investments as a percentage of total funds under management. ART defines climate-related ‘green’ investments as investment in sectors and activities identified as ‘green’ in the Australian Taxonomy Version 1.
Taxonomy alignment:
ART’s climate-related ‘green’ investments totalled $8.4 billion or 2.9% of total funds under management as of 30 June 2024.
AGL Energy
Taxonomy use:
AGL Energy utilised the Australian taxonomy to identify eligible projects, assets or activities to be financed by proceeds raised by green debt originated under its Green Finance Framework.
Taxonomy alignment:
Eligible activities under AGL’s Green Finance Framework are aligned with the Australian taxonomy TSC including:
– D1. Energy Generation from Solar Photovoltaic (PV) and Concentrated Solar Power (CSP)
– D2. Energy Generation from Onshore and Offshore Wind
– D4. Energy Generation from Hydropower
– D5. Geothermal Energy Generation
– D6. Energy Generation from Bioenergy
– D7. Storage of Electricity
– D11. Transmission and Distribution of Renewable and Low-carbon Gases
– D12. Remote and Micro-grid Systems
– C10. Manufacture of Biogas
– I1. Road Passenger Transport, Motorbikes, Cars and Light Commercial Vehicles
– I14. Low-carbon Road Transport Infrastructure
– I15. Micromobility and Active Transport Infrastructure
– I16. Low-carbon Public Transport Infrastructure
SGSP Australia Assets Pty Ltd (SGSPAA)
Taxonomy use:
SGSPAA utilised the Australian taxonomy to identify eligible projects to be financed by proceeds raised by green debt instruments originated under its Green Finance Framework.
Taxonomy alignment:
Eligible projects under SGSPAA’s Green Finance Framework are aligned with the Australian taxonomy TSC including:
– D10. Transmission and Distribution of Electricity
Insights from the Taxonomy Implementation Pilot Program
The Taxonomy Pilot Implementation Program has supported financial institutions to apply the Australian Sustainable Finance Taxonomy in practice.
The following case studies share early insights from participating organisations after testing the Australian sustainable finance taxonomy across different parts of the financial system.
Intended to support market learning, they do not represent formal certification or endorsement of individual transactions, products or organisations, but provide practical examples of how the taxonomy can be used, what implementation questions are emerging, and where further guidance may be needed.
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