Greenhouse Gas Accounts of the Export Credit Guarantee Portfolio
Promotion of Climate-Friendly Export
Monitoring the Progress of the Climate Strategy for Export Credit Guarantees
To support the German export industry in its transformation, the export credit guarantee (ECG) portfolio is geared towards a 1.5-degree pathway. To this end, climate-friendly projects can qualify for improved cover conditions as part of the climate strategy, while projects that are not compatible with a 1.5-degree pathway will be excluded.
Progress in aligning the ECG portfolio with the 1.5-degree target is measured through greenhouse gas (GHG) accounting. GHG accounts for projects in advanced economies shall be reduced to net zero by 2045, and for projects in developing and emerging economies by 2050.
Results
As of December 31st, 2024, the use of goods and services covered by the federal government resulted in Scope 1 & 2 emissions of 27.6 million tonnes of CO2e for the year 2024. The amount of partially determined Scope 3 emissions for 2024 is 23.1 million tonnes of CO2e. This represents a reduction of 22 % and 20 %, respectively, from the baseline year 2022, when Scope 1 & 2 emissions were 35.6 million tonnes of CO2e, and Scope 3 emissions were 29 million tonnes of CO2e.
Since the outstanding risk can fluctuate significantly at the reporting date each year and thereby influence the absolute sum of Scope 1 & 2 emissions, emissions intensity is a more significant indicator of the progress of the climate strategy. The emissions intensity puts the GHG emissions in relation to the outstanding risk.
The intensity of Scope 1 & 2 emissions has decreased compared to the baseline year 2022. In 2024, one million euros of outstanding risk was associated with an average of 537 tonnes of CO2e, compared to 703 tonnes in 2022.
In 2024, renewable energy projects avoided emissions of 9.6 million tonnes of CO2e – a significant increase compared to the calculated 4.2 million tonnes of CO2e of avoided emissions in 2022. This increase is mainly because the outstanding risk related to renewable energy projects more than doubles since 2022.
The data quality weighted by emissions share for Scope 1 & 2 emissions in 2024 according to the PCAF score is 3.5.
Shares of the key sectors in the total emissions of the ECG portfolioin the years 2022 to 2024
Even in 2024, the cover portfolio consists mainly of transactions that were covered before the climate strategy came into effect. Consequently, the share of emissions from fossil fuels remains high at 52% in 2024; however, there has been a reduction compared to the 2022 baseline year (58%). Overall, the relative emission shares of the sectors confirm the selection of key sectors for the climate strategy's sector guidelines: more than 80% of emissions stem from transactions within the key sectors.
GHG emissions, emissions intensity, and outstanding risk by key sector of the climate strategy in the reporting years 2022 to 2024
2022 | 2023 | 2024 | |||||||
|---|---|---|---|---|---|---|---|---|---|
| Compensation risk (€ billion)1 | Absolute Scope 1 & 2 | Emission | Compensation risk (€ billion)1 | Scope 1 & 2 | Emission | Compensation risk (€ billion)1 | Absolute Scope 1 & 2 emissions (MtCO2e) | Emissions intensity (Scope 1&2) (tCO2e/ € million) |
| Fossil energy | 6.5 | 20.9 | 3,195 | 5.8 | 17 | 2,932 | 5.1 | 14.2 | 2,808 |
| Civil aviation | 3.4 | 4.2 | 1,246 | 2.9 | 3.5 | 1,193 | 3.2 | 3.1 | 971 |
| Civil shipping | 14.4 | 2.8 | 194 | 11.6 | 2.1 | 184 | 10 | 1.8 | 178 |
| Chemical industry | 5.4 | 1.6 | 311 | 5 | 1.9 | 388 | 5.3 | 1.6 | 297 |
| Metal | 1.6 | 1.2 | 746 | 1.6 | 1.1 | 680 | 2.4 | 1.5 | 631 |
| Other | 14.5 | 4.9 | 337 | 16.3 | 5.1 | 303 | 17.4 | 5.4 | 308 |
| Total | 50.6 | 35.6 | 703 | 50.8 | 30.7 | 604 | 51.6 | 27.6 | 537 |
1 The analysed compensation risk relates to the (residual) exposure of individual cover. Interest is not considered; only the capital amount . The total value also includes renewable energy transactions totaling EUR 8.2 billion (2024), EUR 7.6 billion (2023) and EUR 4.9 billion (2022). Greenhouse gas emissions (Scope 1&2) from these transactions are assumed to be negligible (zero).
GHG emissions avoided by renewable energies in the reporting years 2022 to 2024
| Outstanding risk (€ billion) Renewable Energy | Avoided emissions (Mt CO2e) | Relative avoided emissions (Scope 1 & 2) (t CO2e/million €) | Outstanding risk (€ billion) Renewable Energy | Avoided emissions (Mt CO2e) | Relative avoided emissions (Scope 1 & 2) (t CO2e/million €) | Outstanding risk (€ billion) Renewable Energy | Avoided emissions (Mt CO2e) | Relative avoided emissions (Scope 1 & 2) (t CO2e/million €) |
| Total | 4.9 | 4.2 | 856 | 7.5 | 9.2 | 1,235 | 8.2 | 9.6 | 1,167 |
Methodology
In accordance with the climate strategy for export credit guarantees, the GHG accounts are calculated for all investment projects supported by single transaction guarantees, making it a valid measure of the effectiveness of the climate strategy criteria. The GHG accounts capture the GHG emissions associated with the projects and the use of the goods and services covered by the federal government.
Currently, there is no international standard for calculating the portfolio emissions of a promotion instrument such as the ECG. Therefore, an approach for calculating the GHG emissions of the ECG portfolio was developed based on the recognised ‘Financed Emissions’ standard for banks defined by the Partnership for Carbon Accounting Financials (PCAF). In September 2025, Euler Hermes joined PCAF on behalf of the German government's foreign trade promotion guarantee instruments. This will strengthen the calculation process by improving data access.
In accordance with the PCAF standard, the federal government is allocated the project emissions of all coverages in the portfolio, in proportion to the share of the current outstanding risk relative to the total financing project value.
Fig.: General formula for calculating the GHG footprint
For renewable energy projects, the PCAF standard also allows for the calculation and reporting of so-called avoided emissions. This is a hypothetical calculation of the emissions saved by replacing fossil-fuel generated energy.
The GHG accounts and the avoided emissions are calculated and published annually. The GHG accounts are determined based on the emissions of the coverage portfolio as of December 31st of the respective reporting year.
Since the amount and composition of new coverage fluctuates annually, as do the repayment profiles of individual export credits, no linear trend in annual GHG emissions is expected. Reliable conclusions on the effectiveness of the ECG climate strategy can only be drawn after several years.
Accounted Emissions
All significant greenhouse gases in accordance with the United Nations Framework Convention on Climate Change are considered. This includes both direct Scope 1 emissions and Scope 2 emissions from purchased energy for the covered projects. In addition, upstream Scope 3 emissions resulting from a project’s supply chain are also calculated. For projects involving the extraction, processing, transportation, and storage of fossil fuels, as well as for cruise ships, downstream Scope 3 emissions are also calculated.
Data sources and data quality
In accordance with the OECD Common Approaches, all projects involving fossil fuel power plants or those with annual emissions exceeding 25,000 tonnes of CO2 equivalents (CO2e) must calculate their GHG emissions. Where such emissions data or other project-specific GHG-relevant data (e.g., energy use) is available, they are used for the footprint calculation. Otherwise, the emissions are determined using so-called economic emission factors. These are sector-specific and country-/region-specific factors and specify the average GHG emissions associated with each covered euro of asset value. For example, for a covered paper machine in Mexico without project-specific emissions data, the outstanding risk in euros would be multiplied by the average GHG emissions of the paper industry in Mexico in CO2e/euro.
The use of various data and calculation approaches is in line with the PCAF standard and is transparently documented through the classification and disclosure of different data quality levels. For this purpose, the PCAF data quality scale is used, with Score 1 representing verified emission data and Score 5 representing emission estimates based on economic emission factors.
Baseline
The GHG accounts of the ECG portfolio were calculated for the first time in 2022. These results serve as a baseline against which future progress and changes in emission levels can be measured. Scope 1 and 2 emissions form the baseline of the ECG climate strategy’s net zero target.
Should significant changes in data sources or the calculation approach become necessary in the future that have a significant impact on the results, the baseline would also be recalculated to ensure the results are comparable over time.
Notes and assumptions
- The preparation of the GHG balance sheet follows the principle of prudence: for example, the full operating emissions are recognized from the time a project is covered, even if a covered facility only goes into operation at a later date. If no clear information on transactions is available, the higher emission factors are also selected. For example, in the case of coal-fired power plants, it is not automatically possible to evaluate whether they are operated with lignite or hard coal. In line with the principle of prudence, the higher lignite emission factor is therefore used.
- The reporting data used is the reporting data known at the time of GHG balancing. These may be time-delayed (e.g. use of reported data from the 2022 reporting year of a project for the 2023 GHG calculation).
- The results are not comparable with results from other financial institutions or export credit agencies, as the methodology and underlying funding instruments may differ. The results and development should only be viewed in the context of monitoring the ECG climate strategy.
Notes and assumptions
- The GHG accounting of ECGs follows a precautionary approach: For instance, from the moment a project is covered, full operational emissions are assumed, even if the covered facility only becomes operational later. In the absence of clear information on transactions, higher emission factors are chosen. For example, it is not automatically identifiable whether coal power plants operate on lignite or hard coal. In line with the precautionary approach, the higher emission factor for lignite is therefore used.
- The reporting data used is the data known at the time of GHG accounting. These may be delayed (e.g. using reported data from a project’s 2022 report year for the 2023 GHG calculation).
- The results are not comparable with those of other financial institutions or export credit agencies, as the methodology and underlying promotion instruments may differ. The results and their development should only be considered in the context of monitoring the ECG climate strategy.
Your contacts
