Nishant Malhotra Founder of Middle Road OPC Pvt Ltd & The middle Road platform on the evolving Sustainable Finance sector

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Green Bonds Rise

AC Energy Inc raised $400M (EUR 363.4M) in green bonds, the first US dollar-denominated fixed-for-life green bond in the world. The company plans to expand the footprint of renewable energy and sustainability across the ASEAN region. The Philippines based company, which is part of the Ayala Corp, plans to generate at least 50 percent of its total energy output through the renewable sector by 2025. The company will fund 1000MW of renewable projects through the proceeds of the bond. (USD 1.0 = EUR 0.909; M:Million). Green bonds form the most signification part of sustainable finance sector globally with blue, social, sustainability and sustainable development bonds as other players within this segment.

In another development Brookfield Renewable Partners L.P, one of the world’s largest publicly traded pure-play renewable energy companies in the world with $40B of assets as of 2018, issued CDN$425 million aggregate principal amount of medium-term notes. With this issue, the Canadian giant brings the issuance of its green bonds to $3B, with 19,000 MW of installed capacity and 18000 MW of the development pipeline. The multinational has business in North America, Europe, Asia, and South America. The proceeds of the green bonds are invested in renewable generation and/or Energy Efficiency and Management projects.

According to Climate Finance, the global market share of green bonds increased to $258.9B up from 171.2bn with a record of 1802 deals. In 2019, the top three countries in Green Bond issuance are the US, China, and France. Among the countries, France posted the largest increase in Green Bond issuance of $30.1B, a growth of 113.4% over 2018. It also has the most significant range of large issuers on the back of policy support. Energy, Buildings and Transport remain the top three sectors for use of proceeds of the bonds with 32, 30 and 20 percent share respectively.  Blue economy focused towards marine ecosystem receive the least investment globally among among all the SDGs. It must also be noted that Blue bonds  which target life below the water operate separately as well.

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