We welcome four new members of Climate Bonds Advisory Panel, working to develop green debt capital markets:
Imtiaz Ahmad , Executive Director, Morgan Stanley Bank. Imtiaz was responsible for establishing the Morgan Stanley’s carbon trading and projects business; he is currently working on climate finance initiatives. He Imtiaz is a director of the International Emission Trading Association and a member of the UK Government’s Capital Markets for Climate Initiative.
1. The Southern California Public Power Authority is issuing a tax-exempt $159.4m project revenue bond to prepay for electricity from a wind farm.
The SCPPA is a non-profit “joint powers” agency of 12 public power utilities who come together to finance and acquire electricity generation projects, including many renewable energy projects.
Its model is to hold an undivided equity interest in the facility, issue tax-exempt debt financing to pay for the energy delivery, and sell 100% of the output to the interested members at cost.
This bond is the second; an 2010 bond for $237m (AA-/A1) won numerous 'deal of the year' awards.
The German government decided last Thursday that the country's KfW development bank will finance 10 wind farms with a combined €5 billion; KfW will now be able to provide up to €700 million in funding (and half of that in risk participation) per project.
Keeping financing costs low is essential to making these new large offshore wind farms financially viable under the current feed-in tariff.
Pointer to other countries: that's the way we're going to quickly shift our energy systems to clean.
The newsletter “Asset-Backed Alert” carried a story on Friday suggesting that the US is about to see a revival of PACE (Property Assessed Clean Energy) municipal bonds, securitizing clean-energy loans to households.
The Climate Bonds Initiative announced today an expansion to the scope and intent of the Climate Bond Standard slated for release at the end of July 2011.
The first release of the Standard will now cover not only corporate bonds, but also project development bonds and bonds issued by securitization vehicles.
CalSTRS Joins Climate Bonds Standards Board to Boost Green Debt Capital Market
Goal to assure integrity of green claims for investors, governments.
The Australian Government announced on the weekend it will set up a "Clean Energy Finance Corporation" (CEFC) as a statutory body. The initiative is part of a large package of climate change finance measures, including a long-awaited carbon tax.
Germany's SolarWorld is issuing a €150 million corporate bond.
Also in Germany, Windreich (wind energy) is issuing a €75 million corporate bond.
So you have some context for the news we post about climate and green bonds, here are some amazing facts about the bond market.
1. Global bonds outstanding in 2010 = $95 trillion. That's a big market. Global equity market capitalization in 2010 = $55 trillion
2. The bond market equals 130% of global GDP, up from only 80% 10 years ago. Equities used to be the bigger of the two, but the great financial crash has seen those positions reversed.
(All facts are courtesy of CityUK's new report on the bond market. They're a great source of data!)
