Climate Change Data

Environmental Metrics

ESG Focus Areas

• Climate Change
• Affordable Housing
• Environmental Sustainability

Environmental Achievements

• Issued approximately $617 million in Single-Family Green MBS, financing energy-efficient homes and home improvements.
• Avoided an estimated 211,292 metric tons of GHG emissions annually (updated from previously reported estimates). This is equivalent to removing 2,433 cars from the road for a year and represents an estimated 69% decrease in total GHG emissions resulting from energy consumption at these homes.
• Saved an estimated 192,168 MMBtu of source energy annually. This is enough energy to power 1,877 homes and represents an estimated 47% average decrease in total source energy consumed by homes securing mortgages backing Green MBS issued in 2021.

Social Achievements

• Provided financing to support energy-efficient improvements for approximately 1,685 families through GreenCHOICE Mortgages in 2020.
• Achieved an estimated average annual utility cost savings of $1,027 for homeowners, representing an estimated 50% average decrease in total annual utility bills.

Governance Achievements

• Established a Single-Family Green Bond Framework, which received a Light Green Second Opinion rating from CICERO Shades of Green.
• Maintained transparency for the investment community through detailed pool-level and loan-level disclosures on the Freddie Mac’s Single-Family Green MBS website.

Climate Goals & Targets

Environmental Challenges

• Lack of a single standard for GHG accounting.

Mitigation Strategies

• Developed a methodology in coordination with Earth Advantage®, seeking to make it publicly available and transparent, in keeping with best practices outlined in Handbook: Harmonized Framework for Impact Reporting published in June 2021 by ICMA.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: ICMA Green Bond Principles

Third-party Assurance: CICERO Shades of Green (Light Green Second Opinion)

Sustainable Products & Innovation

• Single-Family GreenCHOICE Mortgages®
• Single-Family Green MBS

Environmental Metrics

ESG Focus Areas

• Affordable and sustainable housing
• Climate change
• Diversity, Equity, and Inclusion
• Sustainable operations

Environmental Achievements

• Projected water savings of over 526 million gallons per year from Impact Bonds
• Projected energy savings of over 390 million kBtu per year from Impact Bonds
• Projected annual GHG emissions decrease of 32,188 metric tons from Impact Bonds
• Green Bonds projected water savings of over 41 million gallons per year
• Green Bonds projected energy savings of over 31 million kBtu per year
• Green Bonds projected annual GHG emissions decrease of 3,266 metric tons

Social Achievements

• Impact Bonds financed 73,142 units affordable to tenants earning at or below 50% AMI
• Impact Bonds financed 137 properties with 20,874 units located in High Opportunity Areas
• Green Bonds financed 4,497 units affordable to families earning at or below 80% AMI
• Social Bonds provided liquidity to social impact institutions and financed properties for underserved populations
• Social Bonds financed 2,729 units with RAD projects
• Sustainability Bonds financed 21,765 units affordable to families earning at or below 80% AMI
• Sustainability Bonds financed 4,675 units located in High Opportunity Areas

Governance Achievements

• Increased transparency in impact investing reporting, including borrower savings from energy and water efficiency improvements

Climate Goals & Targets

Environmental Challenges

• Data challenges in multifamily properties impacting savings analysis (availability of tenant data, lack of reported data, inaccurate estimated data, usage variations)
• Affordable housing crisis with tightening supplies and rising costs

Mitigation Strategies

• Developed Benchmarking Data Collection Best Practices Guide to improve data quality
• Implemented measurement and verification (M&V) analysis to assess actual savings
• Continued evaluation and implementation of ways to improve data collection and reporting

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: ICMA Green Bond Principles, ICMA Social Bond Principles, ICMA Sustainability Bond Guidelines

UN Sustainable Development Goals

• Goal 1: No Poverty
• Goal 7: Affordable and Clean Energy
• Goal 10: Reduced Inequalities
• Goal 11: Sustainable Cities and Communities

Sustainability Bonds align with these UN SDGs

Sustainable Products & Innovation

• Green Up and Green Up Plus programs

Awards & Recognition

• Light Green rating from CICERO for Green Bonds Framework
• Recognition from Environmental Finance for P-013 Social Bonds transaction

Environmental Metrics

ESG Focus Areas

• Climate Change
• Energy Efficiency
• Renewable Energy

Environmental Achievements

• Issued approximately $1.9 billion in Single-Family Green MBS in 2023, bringing the total issuance since 2021 to $3.8 billion. This represents a 35% increase from 2022.
• Estimated 211,468 MMBtu of source energy saved annually.
• Estimated 11,434 metric tons of GHG emissions avoided annually.

Social Achievements

• Helped more than 1.4 million families buy, refinance, or rent a home in 2023.
• Financed approximately 800,000 home purchases, with 51% being first-time homebuyers.
• Financed more than 447,000 rental units, 92% of which were affordable to families earning no more than 120% of area median income (AMI).

Governance Achievements

• Single-Family Green Bond Framework received a Light Green Second Opinion rating from CICERO Shades of Green.
• Improved transparency to investors with new pool-level attributes disclosing environmentally friendly attributes of collateral.

Climate Goals & Targets

Environmental Challenges

• Maintaining the energy efficiency standards in a changing market environment.
• Scaling the Green MBS program while managing risk.

Mitigation Strategies

• Planning to update the Green Bond Framework in 2024 to tighten HERS score requirements.
• Exploring additional types of eligible collateral for Green MBS.
• Allowing lenders to form and market their own Green MBS that meet the Framework criteria.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: ICMA Green Bond Principles

Third-party Assurance: CICERO Shades of Green (Light Green Second Opinion)

Sustainable Products & Innovation

• GreenCHOICE Mortgages
• Green MBS

Environmental Metrics

ESG Focus Areas

• Climate Impact
• Sustainable Housing
• Diversity Equity and Inclusion (DEI) and Human Capital
• Sustainable Operations

Environmental Achievements

• $6.02 billion in Green Bonds issuance since 2019 financing 30% energy/water-efficiency improvements with a minimum of 15% energy reduction.
• 80% of units financed through Green Bonds are affordable to tenants making 80% AMI or less.

Social Achievements

• $8.93 billion in Social Bonds issuance since 2020 supporting targeted populations and providing liquidity to social impact institutions.
• 66% of units financed through Social Bonds are affordable to tenants making 50% AMI or less.
• 38% of units financed through Social Bonds are affordable to tenants making 30% AMI or less.

Governance Achievements

• Implementation of enterprise-wide sustainability strategy with long-term goals in Environmental, Social, and Governance areas.
• Engagement of independent third parties (S&P Global Ratings and Sustainalytics) for framework evaluations.

Climate Goals & Targets

Environmental Challenges

• Difficult market conditions creating a need for transitional housing.

Mitigation Strategies

• Social Bonds transactions supporting transitional housing initiatives.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: Green Bond Principles, Social Bond Principles, Sustainability Bond Guidelines

Sustainable Products & Innovation

• Green Advantage program
• Green Up loan program
• Green Bonds
• Social Bonds
• Sustainability Bonds

Awards & Recognition

• Recognition by Climate Bonds Initiative, Environmental Finance and GlobalCapital