VCLF Releases First Environmental Impact Report

December 2nd, 2020: The Vermont Community Loan Fund (VCLF) today announced the release of “A Carbon Impact Analysis of VCLF’s Loan Portfolio,” studying the environmental impacts of the organization’s work.

A mission-driven nonprofit lender, and a US Department of Treasury-certified Community Development Financial Institution (CDFI), VCLF is the first organization of its kind in the US to produce an environmental impact analysis using the methodology originated by the Partnership for Carbon Accounting Financials (PCAF), a global collaboration of financial institutions committed to transparency, accountability and climate justice.

“The Vermont Community Loan Fund is committed to doing our part in the fight for environmental justice,” commented VCLF Executive Director Will Belongia. “Carbon accounting gives us a new lens through which to examine our work, so we can better understand and mitigate the negative consequences of that work, and foster the positive.”

The Vermont Community Loan Fund & PCAF

PCAF was founded in response to the 2016 Paris Agreement, an international commitment to limit global warming to 1.5°C above pre-industrial levels and reach net zero emissions by 2050. To date, 88 financial institutions, with $18 trillion in assets, have committed to use the PCAF methodology to analyze and report their environmental impacts.

VCLF joined PCAF in November 2019. This spring, VCLF used the PCAF methodology to analyze the organization’s loan portfolio as of December 31st, 2019. Collection, organization and analysis of VCLF’s loan-level data was conducted by University of Vermont senior Alex Trehubenko, an intern through UVM’s Department of Economics.

“PCAF commends the Vermont Community Loan Fund for being an early adopter and champion of PCAF’s carbon accounting methodology in North America.” said Giel Linthorst, PCAF Executive Director. “We hope to see other capital providers, including CDFIs and conventional lenders at all scales, join our group to measure and report their financed emissions to enable alignment with the goals of the Paris Agreement.”

“CDFIs like the Vermont Community Loan Fund are mission-led justice organizations, fighting for inclusion, opportunity and social & economic justice,” said Belongia. “Now, we can authentically incorporate climate justice in our mission and goals. I urge our peers, CDFIs and other lenders, to use this valuable tool to better understand our work and its impacts, intended or not.”

VCLF’s 2020 Carbon Impact Analysis

PCAF’s open-source methodology measures environmental impact in part by the amount of greenhouse gas emissions (GHGs) produced by businesses and organizations in a loan or investment portfolio, represented as metric tons of CO2 equivalents, or tCO2e.







While VCLF’s lending for the development of affordable housing represents just over half the value of the total loan portfolio by dollar, that work represents almost all (98%) of the portfolio’s carbon impact.







The second greatest concentration of carbon impact can be found in VCLF’s food, agricultural & forestry lending portfolio. Small business loans comprise almost half of VCLF’s non-housing portfolio (43%), with nonprofits & community facilities (35%) and early care & learning (21%) making up the balance.

However, the carbon impacts of these sectors are not nearly so evenly apportioned: agriculturally-related loans, which make up just 11% of non-housing loans outstanding, are responsible for 85% of the non-housing portfolio’s greenhouse gas emissions output.

Data from this and future carbon impact analyses will be used to help understand and manage environmental impacts generated by VCLF loan portfolio businesses and organizations.

“Of the financial institutions around the world who’ve committed to use the PCAF methodology to analyze and report our carbon impacts, VCLF is by far the smallest in terms of assets under management.” said Belongia. “But in Vermont, we know that small can still be mighty. You can’t assign a dollar amount to our commitment to our borrowers, our community and the planet we all share.”

The full report is available HERE.