Climate Bonds has posted a new item, ‘A bunch of climate bond media stories for you: Financial News, Wall Street Journal, Enviro. Finance, Inst. Investor, etc ‘
Financial News – ‘It’s not easy being green’
Article talks about lack of regulations concerning what qualifies as ‘green’ in the context of 9 more banks backing the Green Bond Principles.
Consultants, as well as investors, exhibit differing shades of green. For some, retrofitting pollution-reduction technology at coal-fired power plants is green. For Cicero and the Climate Bonds Initiative, it is not.
Sean Kidney of the Climate Bonds Initiative predicted: “Aggregation will be a growth area in 2014 and 2015.” He added: “The mixed portfolio will be critical, because there is probably not enough dealflow in one single sector silo.”
Wall Street Journal – ‘Investors Warm to Green Bonds’ – Ben Edwards
Article talks about developments on the market in the context of Unilever’s green bond.
“There’s a lot of demand out there,” said Bridget Boulle, program manager at the Climate Bonds Initiative, a London-based not-for-profit organization that promotes investment in low-carbon economies. “We see this first wave of green bond issuance as flushing out this demand and getting the market going.”
Financieele Dagblad (dutch equivalent to Financial Times) – ‘Stormachtige opmars groene obligaties’
Steun van beleidsmakers is ook onontbeerlijk om de markt te doen slagen, meent Sean Kidney van de Britse lobbygroep Climate Bonds Initiative. Hij wijst op de enorme investeringen die nodig zijn voor de overgang naar een duurzame economie. ‘Wij moeten laten zien dat daarvoor genoeg kapitaal bij beleggers zit en we moeten aan beleidsmakers uitleggen dat ze met het juiste beleid goede investeringen kunnen stimuleren. Groene obligaties laten zien dat beleggers investeren als het beleid daarop is afgestemd. Maar je komt pas bij beleidsmakers aan tafel als je kunt laten zien dat er veel cash is om te investeren.’
Environmental Finance – green bond underwriters in first quarter of 2014
Short article based on data from Climate Bonds blog post about underwriters league table.
CBI also released a league table for the largest underwriters in the field since 2007, in which SEB retained pole position, with JP Morgan and Bank of America Merrill Lynch coming second and third, respectively.
Environmental Finance – ‘Île-de-France increases size of green bond due to strong demand’ – Sophie Robinson-Tillett
According to reports from NGO the Climate Bonds Initiative (CBI), demand for the bond had reached €750 million within the first hour of its launch, prompting Île-de-France to raise the total to €600 million. “I guess we can take that as another market signal,” said CBI CEO Sean Kidney, referring to the rapid growth of the fledgling market in recent months.
Environmental Finance – ‘Arise launches SEK1.1 bn green bond’ – Sophie Robinson-Tillett
“Refinancing is important for the capital pipeline, especially for pureplay companies like Arise who will be building more wind farms,” said Bridget Boulle of NGO the Climate Bonds Initiative.
Renew Economy – ‘UniSuper taps World Bank’s first Australian Green Bond issue’ – Sophie Vorrath
Article talks about the World Bank Australia Green bond in the broader context of market developments and latest issuance. #
And just this week, the French regional government that oversees Paris, Île-de-France, issued their second green bond – or Green & Sustainability Bond – of €600 million for 12 years. As Climate Bonds’ Sean Kidney wrote, they went to market looking for €350 million, but after one hour closed with €750 million of orders, and ended up issuing €600 million. “I guess we can take that as another market signal,” said Kidney.
Institutional Investor – ‘Green Bonds Market Poised for Growth Spur’ – Carol J. Clouse
Article talks about green bonds market maturation in the context of Solactive green bonds index and recently released corporate bonds by Unilever, Toyota and EDF.
If 2013 was the year the green bond market finally took root, 2014 could very well be the one it begins to flourish. One sign of the market’s maturation os teh arrival of the first index dedicated entirely to green bonds. The Solative Green Bond index, launched March 12 by Frankfurt based index provider Solactive, comprises bonds categorised as green – that is, those that raise capital for projects with specific environmental benefits – by the Climate Bonds Initiative, a notforprofit organisation headquartered in London.
Blue&Green Tomorrow – ‘Campaigners call for clarity in Green Bond Principles’ – Charlotte Malone
Article about BankTrack network’s letter calling on the banks supporting the Green Bonds Principles to ensure high standards.
A coalition of campaigners has called for further clarification in the Green Bond Principles, to ensure they include “genuine commitments rather than broad recommendations”. A green bond’s proceeds are used to fund environmentally friendly projects, ranging from renewable energy to habitat restoration. According to figures from the Climate Bonds Initiative, the market reached a record $10 billion (£6 billion) in 2013.
GreenBiz – ‘5 finance models bringing clean power to the people’
Article written by Chris Nelder – an energy analyst and consultant. Among those 5 finance models he lists solar bonds, no-money-down storage, yieldcos, crowdfunded solar as well as Climate Bonds – the only time when someone referred to green bonds as climate bonds which is quite interesting.
An even larger, global pool of capital has been opened up with the advent of “green bonds” (aka “climate bonds”) which are used to back a wide range of projects that can help in the fight against climate change, such as renewable energy, waste management, sustainable forestry and land use, biodiversity projects, clean transportation projects (including rail), water and energy efficiency. The London-based Climate Bonds Initiative has partnered with some of the world’s largest banks to define eligibility standards, certification, insurance and other typical assurances to ensure the bonds are investment-grade. The global green bond market is already $72 billion in size, and total issuance is growing at a rate of 25 percent per year.
Economist – ‘Money for nothing’
Article about high cost of green loans.
In theory, these schemes should boost investment in common energy-saving measures, such as extra insulation and new boilers, as the first owner does not have to pay all the costs upfront. But enrolment rates have disappointed, according to Sean Kidney at the Climate Bonds Initiative, a think-tank. In Britain, just 1% of those assessed for the Green Deal have signed up. In Berkeley, California, home of the first PACE scheme, the take-up rate is similarly paltry.
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Best regards, Sean Kidney sean@climatebonds.net