Arise AB, the Swedish integrated wind power company, has announced issuance of a SEK 350m green bond, their second green bond in 2014. It is a senior unsecured bond with a floating interest rate of 6% above STIBOR 3M.
Similar to their April issuance (SEK 1.1bn), this bond will be used to re-finance existing debt. The underwriters were ABG Sundal Collier and Swedbank. Arise are aiming to list the bond on NASDAQ OMX Stockholm. DNV GL (the parent is a Foundation, in case you didn't know - Det Noske Veritas) has provided an independent review of "compliance with the Green Bond Principles".
Pureplay renewable energy companies adopting best practice is an indicator that the broader green theme, with geater scale and liquidity than available in industry silos, is seen as useful for component industries of the low-carbon economy. We expect to see more such companies taking advantage of the growing thematic bond market over the next year.
An investor looking at a "green" portfolio should, of course, already be thinking of wind and solar bonds - as many are. Bloomberg New Energy Finance is expanding the initial description of the green bonds market beyond the self-labelled, by bringing in renewable energy project bonds into their classification, as do some index providers now (using data we provide).
The question now is - should we be bringing all pureplay renewable energy corporate bonds into the green bond list? Does it get tricky because corporate entities may change direction? Let me know what you think.
