CMS Energy Corporation began this year with its principal subsidiary Consumers Energy, Michigan’s largest electric and natural gas utility, earning a spot as one of Newsweek’s Top 10 Greenest Companies in the Nation. But, Patti Poppe, President and CEO of CMS Energy, continued to look for ways to demonstrate their “long-term strategic commitment to protect the planet”.
In February, CMS Energy and Consumers Energy announced Consumers Energy's planet goals. By 2040, Consumers Energy plans to reduce carbon emissions by 80 percent, have renewable energy sources and energy storage deliver more than 40 percent of its energy and eliminate its use of coal for electricity altogether. In June 2018, Consumers Energy filed its Integrated Resource Plan with the Michigan Public Service Commission and proposed to reduce its carbon emissions by more than 90% by 2040 – exceeding its 80% reduction goal.
This leadership in sustainability from a long-term client did not go unnoticed by Barclays’ team. Jed Lynch, Head of Social Impact Banking at Barclays, had heard from European colleagues about a new type of credit facility, in which direct pricing benefits were tied to a borrower’s sustainability performance.
As his team considered which clients could be good candidates to pioneer a similar structure in the U.S., “CMS Energy came to the top,” Lynch said. “The motto of ‘People, Planet and Profit’ was a clear focus to the company—including on quarterly earnings calls.” He added, “For Barclays to initiate its first foray into offering sustainability-linked loans to CMS Energy was a natural fit.”