By Bridget Boulle
Yesterday, French multinational electric utility company, GDF Suez, announced its first green bond – a whopper EUR2.5 billion ($3.5 billion) bond linked to ‘renewable energy and energy efficiency projects that contribute to fight climate change’. The bond shares GDF’s credit rating of A1/A-.
The bond was issued in two tranches: a 6-year tranche of EUR1.2 billion with a 1.375% interest rate, and a 12-year tranche of EUR1.3 billion with a 2.375% interest rate.
According to the International Energy Agency (IEA), the transport sector is responsible for 23% of all energy-related CO2 emissions globally and 13% of total GHG emissions. Shifting to low-carbon transport is essential for climate change mitigation; but what should and shouldn't be called "low-carbon" is not always clear.
Mark Burrows is the Executive Vice Chairman & Managing Director, Asia Pacific, Credit Suisse Investment Bank. He's also passionate about protecting forests and about climate change.
On Monday, in a speech to the Forests Asia Summit in Jakarta, he talked at length about green bonds, and we loved every word of it!
I want to talk to you about bonds, and specifically about green bonds.
Bonds are attractive for many reasons; they are a familiar product to the investment community and they represent the single largest pool of capital in the world. The key question today is how would these benefit our forests?
I’m in Seoul, in a vast room for the 2014 Clean Energy Ministerial roundtable, surrounded by men in dark suits – only a sprinkling of women – listening to the IEA’s Maria van der Hoeven give a rock star speech about the State of Climate Change.
It’s not good news: the growth of coal-fired power growth since 2008 has beaten the growth of renewable energy. The relentless increase in use of fossil fuels in developing markets has wiped out any gains we’ve made with clean energy in developed countries. Errrk.
We welcome three new members to our stellar expert panel:
Abu Dhabi is indeed a crazy place: gold-leaf covered 7 star hotels surrounded by desal-water fed green lawns and endless freeways in a hot hot hot and dry land.
Abu Dhabi has been (generously) hosting the 2 day “UN Ascent” preparatory meeting for September’s UN Climate Summit. Lots of governments here and a bunch of others working on Summit components, like me.
There’s been a lot of discussion about green bonds or “green climate bonds”. As World Bank VP Rachel Kyte said “Green Bonds are the biggest climate finance story around today”.
Rachel also inadvertently broke the news of our new Green City Bonds project, to be launched at the UN Climate Summit. Info to follow.
Financial News – ‘It's not easy being green’ - Edward Russell-Walling
Article talks about lack of regulations concerning what qualifies as ‘green’ in the context of 9 more banks backing the Green Bond Principles.
According to SeeNews, Hong Kong-based Jun Yang Solar Power Investments yesterday issued a HKD 190 million (USD 24.5m/EUR 17.7m) bond. The bond was placed with at least six investors.
Because the company is a "pureplay" solar company, making thin-film PV modules and developing solar projects, we include this in our broad "bonds and climate change" universe.
The World Bank last week issued its first 'Kangaroo' Green Bond (yes, that is really is the financial markets term!): AUD300m ($280m), 5yrs, AAA. This is the first AUD benchmark green bond. Proceeds are used to fund climate change related projects. Price was 20 basis points over swaps - the same as other World Bank Kangaroo bonds.
BankTrack is a global network of civil society groups tracking the operations and investments of commercial banks and "their effect on people and the planet".
This week they published a letter to the Green Bond Principles signatory banks, giving a cautious welcome to the Principles, but saying that the lack of clarity over what projects can be considered "green" risked setting the project up to fail.
