Green in The City - Green Bonds for Clean Air and Climate Change Overview Transport is the number-one source of air pollution in cities, causing serious problems to human health, the economy, climate and the environment. Current approaches to reducing transport emissions have not led to the desired results, leaving city regulators with challenges of protecting the health and wellbeing of their residents. The Air Quality & Transport (AQT) Green Bond provides public authorities and investors with exciting opportunities to capitalize on clean transport projects that monitor, manage and reduce emissions. Returns on investment are maximized through economic benefits of improved public health and economic productivity, climate change mitigation and reduced public expenditure on transport-related externalities. The AQT Bond is particularly suitable for cities wanting to take global leadership on air quality management and climate change mitigation, providing win-win-win solutions that benefits people, the economy, climate and the environment.

1. CITY AIR QUALITY & TRANSPORT GREEN BOND
Published by: Impact Global Emission Solutions (IGES) Limited, 11/2015
Copyright Impact Global Emission Solutions Ltd. 2015 All rights reserved
Green in the City:
Green Bonds for Air Quality & Transport
Overview
Transport is the number-one source of air pollution in cities, causing serious problems to human
health, the economy, climate and the environment. Current approaches to reducing transport
emissions have not led to the desired results, leaving city regulators with challenges of protecting the
health and wellbeing of their residents. The Air Quality & Transport (AQT) Green Bond provides public
authorities and investors with exciting opportunities to capitalize on clean transport projects that
monitor, manage and reduce emissions. Returns on investment are maximized through economic
benefits of improved public health and economic productivity, climate change mitigation and reduced
public expenditure on transport-related externalities. The AQT Bond is particularly suitable for cities
wanting to take global leadership on air quality management and climate change mitigation, providing
win-win-win solutions that benefits people, the economy, climate and the environment.
On a global scale, clean air is a basic human
right. Air pollution is currently the main cause
of mortality and morbidity globally, affecting
every major city in the world. At least 1 in 8
deaths globally, 7 million deaths annually, are
caused by air pollution1
. In Europe alone, costs
of air pollution are estimated at US$ 1.575
trillion per year2
. Transport accounts for up to
90% of air pollution in towns and cities, with
significant adverse effects on human health.
Emissions of CO2 and Short-Lived Climate
Pollutants from the transport sector account
for a large share of global greenhouse gas
emissions. Without robust action, these
emissions will continue rising, due to
increasing demand for movement of people
and goods3
. Transport pollutants also affect
agricultural productivity and biodiversity.
Clean transport projects provide multiple
economic, social and environmental benefits.
These include improvement of air quality and
public health, climate change mitigation,
increased economic productivity and reduced
public expenditure on transport-related
externalities. These benefits need to be
factored into policymaking and investment
decisions and are maximized by the AQT Bond.
1
World Health Organization (2014) 7 million premature deaths annually linked to air pollution, available at:
http://www.who.int/mediacentre/news/releases/2014/air-pollution/en/
2 World Health Organization (2015) Economic cost of the health impact of air pollution in Europe: clean air health and wealth, WHO
Regional office for Europe, Copenhagen
3
OECD/ITF (2015) ITF Transport Outlook 2015, Paris

2. 2 City Air Quality & Transport Green Bond
Copyright, 2015: Impact Global Emission Solutions Ltd. All rights reserved
Clean Transport Can Maximize Economic Value and Co-Benefits
Exposure of carmakers’ antics in skewing
vehicle emission tests sheds light on the
challenges of regulating transport emissions.
Type approval of vehicles and laboratory
emissions tests do not show actual on-road
emissions. Current technologies equally do not
provide effective solutions for reducing vehicle
emissions4
.
Consequently, existing emission standards and
other policy measures are inadequate for
reducing emissions. Private sector actors can
increasingly support regulators in promoting
clean transport initiatives, by providing
technological know-how and financial
resources through Public-Private Partnerships
(PPPs) and other financial mechanisms.
On-road Monitoring, Reporting and
Verification (MRV) of vehicle emissions
provides regulators with powerful tools to
effectively manage vehicle emissions.
Advanced MRV technologies accurately
measure on-road emissions of a large number
of vehicles in free-flowing traffic. These
technologies, already used in some parts of the
USA and Europe, measure speed, acceleration
and emissions, attributed to vehicle license
plate numbers.
On-road MRV enables:
 Accurate measurement of vehicle
emissions, allowing regulators to
establish emission baselines,
standards and appropriate policies;
 Identification of the most polluting
vehicles (High Emitters), enabling
schemes to reduce their emissions;
 Informing public in real-time about
traffic and pollution conditions,
allowing for better air quality control.
4 ICCT (2014) Real-world exhaust emissions from modern diesel cars, International Council on Clean Transport, Washington
5 ICCT, 2015, Review of current practices and new developments in heavy-duty vehicle inspection and maintenance programs, Washington
6 See for example World Bank, 2014, Reducing black carbon emissions from diesel vehicles, Washington
Many mitigation actions can be implemented
using real-world MRV. To illustrate, 5%-10% of
the most polluting vehicles (High Emitters) are
often responsible for a disproportionately
large share of overall emissions, as illustrated
below. Identifying High Emitters by MRV and
reducing their emissions through, for example,
inspection and maintenance programs, can
deliver significant reductions in fuel
consumption, air pollution and GHG emissions,
along with substantial economic returns to
authorities, investors and vehicle operators5
.
Contribution of 5% of Most Polluting Buses to
Overall Bus Emission
IGES (2015) Vehicle MRV Project, Accra, Ghana
(CO: carbon monoxide; HC: hydrocarbons,
NO: nitrogen oxides; PM: Particulate matter)
There are a multitude of co-benefits arising
from clean transport initiatives, including:
 Reducing mortality and morbidity, as
result of cleaner air;
 Mitigating climate change;
 Enhancing energy efficiency;
 Protecting biodiversity and crop yields;
 Increasing economic productivity.
Realizing these co-benefits means that the
costs of clean transport projects are largely
outweighed by overall economic, social,
climate change mitigation and environmental
benefits6
.
57.6%
32.3%
12.7%
39.2%
CO
HC
NO
PM

3. 3 City Air Quality & Transport Green Bond
Copyright, 2015: Impact Global Emission Solutions Ltd. All rights reserved
The Air Quality and Transport Green Bond
The AQT Bond empowers governments and
the private sector to take control and AQT
NOW on rising transport emissions. It
leverages investment in initiatives that
measure, manage or reduce emissions in
verified, real-world driving conditions,
resulting in a range of tangible co-benefits.
Bond proceeds may be used for projects that
address one or more of the following:
 Measuring, reporting and verifying
transport emissions, including
emission baselines and standards;
 Deploying innovative emission
reduction technologies;
 Developing policy measures to reduce
real-world emissions;
 Building institutional and technical
capacity to reduce emissions;
 Catalyzing pioneering financing
mechanisms, including PPPs.
The bond will leverage investment in projects
and programs across all modes of passenger
and freight transport, including road transport,
marine, rail, aviation and non-road mobile
machinery.
The Bond particularly encourages projects
that maximize co-benefits to:
 Air quality and public health;
 Climate change mitigation;
 Energy efficiency and energy security;
 Environmental protection, food
production and biodiversity;
 Low emission development.
The AQT Bond will follow the Green Bonds
Principles on use and management of
proceeds, project evaluation and selection,
monitoring and reporting and assurance. This
will ensure economically, socially and
environmentally sound investments.
7 An example of this is the Carl Moyer Program implemented in California www.arb.ca.gov/msprog/moyer/moyer.htm
Unlocking Benefits of the AQT Bond
Transaction costs for conducting MRV and
quantifying co-benefits are often seen as being
prohibitive. Many transport projects therefore
do not rely on the provision of such in-depth
information. However, projects undertaken
under the AQT Bond support new business
models, whereby MRV is one of the key
revenue streams.
These projects do not only cover transaction
costs, but also produce significant financial
returns to ensure ongoing project
sustainability and profitability. They may
enable multiple income streams and new
sustainable transport business models,
enhancing returns for investors.
Bond value may be generated from:
 Vehicle emissions monitoring and
testing schemes;
 Policy interventions, including:
emissions standards; inspection,
maintenance and repair schemes; Low
Emission Zones; and incentives to
promote low-carbon technologies7
;
 Pioneering business models promote
uptake of technologies and policies
that improve air quality, fuel economy
and energy efficiency. These may
include lease-based finance and PPPs;
 Corporate social responsibility and
“green branding” initiatives to
enhance the green credentials and
reputation of participant;

4. 4 City Air Quality & Transport Green Bond
Copyright, 2015: Impact Global Emission Solutions Ltd. All rights reserved
 Carbon revenues generated through
synergies with carbon markets;
 Innovative financial mechanisms,
including layered financial structures,
and incentives for Low Emission
Development, with options to
capitalize on currency fluctuations;
 Improved energy efficiency and
security, providing economic returns
to public and private stakeholders.
 Leveraging value of wider economic,
social and environmental co-benefits.
Reduced transport emissions yield
significant benefits to public
authorities and the general public.
These may include increased
productivity, improved air quality and
public health and reducing burden on
health services. AQT projects will
capitalize on these opportunities.
Revenue Streams and Benefits Generated by the AQT Bond
Projects undertaken under the AQT Bond will
be designed according to the political,
economic and social situation in the host
country. Particular emphasis is placed on
projects that maximize benefits to the general
public and enhance involvement of the private
sector, public authorities, academic and
research institutions, non-governmental
organizations and other stakeholders.
Initiatives that support the Sustainable
Development Goals, climate change and
carbon market initiatives at city, country,
regional and international levels are
encouraged.
The AQT Bond provides a structured template,
replicable across cities and countries globally,
having the greatest impact where it is needed
most. Projects undertaken under the Bond will
demonstrate global best practice, setting new
standards for clean transport projects.
By improving air quality, mitigating climate
change, reducing mortality and morbidity and
minimizing economic and environmental
damages, the AQT Bond will ensure cost-
effective, real-world emission reduction
impacts, providing significant financial returns
and liquidity for investors. The AQT Bond aims
to promote access to clean air in cities
globally, maximizing benefits for people,
planet and the economy.
AQT
Bond
Emissions
testing,
monitoring &
inspection
Supporting
policy
interventions
Access to
carbon
markets
Pioneering
business
models
Innovative
financing
mechanisims
Corporate
social
responsiblity
Economic
value of co-
benefits
Energy
efficiency &
security

5. 5 City Air Quality & Transport Green Bond
Copyright, 2015: Impact Global Emission Solutions Ltd. All rights reserved
IGES Company Overview
Impact Global Emission Solutions Ltd. (IGES) is
a transport and environmental project
development and consultancy company. We
promote innovative transitional tools, financial
mechanisms, technologies and methodologies
for low-carbon transport, specializing in real-
world MRV of transport emissions. IGES
develops sustainable, low emission
infrastructure and transport projects, working
with world-leading experts, local stakeholders
and international institutions.
Our aim is to transfer knowledge, technologies
and technical capability, building institutional,
financial and infrastructural capacity to reduce
transport emissions. IGES develops replicable
project templates to deliver verified
reductions in air pollution and GHG emissions,
generating economic and environmental
returns to public authorities and investors. Our
projects create genuine value-added co-
benefits, attracting private and public funding.
IGES focuses on improving air quality and
reducing emissions of long-term and short-
lived climate pollutants. Targeted pollutants
include CO2, black carbon, particulate matter,
hydrocarbons and nitrogen oxides. We deploy
innovative, robustly tested and certified
technologies across all transport modes, with
the ability to deliver revolutionary impacts on
transport emissions and air pollution.
Our Approach is based on the introduction of
innovative, efficient, effective and equitable
solutions for reducing transport emissions, by:
 Deploying advanced MRV technologies,
providing real-world emission baselines
and identifying high emitters;
 Facilitating introduction of effective real-
world vehicle emission standards;
 Advocating highly effective, efficient and
equitable technology and policy-based
solutions for reducing transport emissions
and avoiding conversion of short-lived
climate pollutants to long-term climate
pollutants;
 Eliminating the need for major
infrastructure investments and allowing
for continued use of existing vehicle fleets.
IGES are authors of the revised UNFCCC CDM
methodology AMS III BC – Combustion
Efficiency Improvements. This methodology
adopts simple MRV guidelines to facilitate the
development of standardized baselines in the
transport sector, suitable for MRV under a
range of international climate mechanisms at
both project and country levels. The
methodology is scalable, replicable and
adaptable across sectors and geographic
locations.
Capabilities: The IGES team has world-leading
experience in transport emission-reduction
projects. We specialize in advanced MRV
technologies, innovative business models and
PPPs, international climate finance,
sustainable transport planning, policy design
and implementation, quantifying and
modeling economic co-benefits, stakeholder
training and capacity building.
Our team of international experts ensures
successful project delivery and
implementation of best-practice emission
reduction solutions. IGES collaborates with
public authorities, private stakeholders and
international agencies to develop emission-
reduction projects that are in line with local
priorities and national and international
commitments. We act to reduce global
transport emissions today!
For more information, please contact us:
Projects@impactglobalemissionsolutions.com