Green Banks, Green Bonds, Green Principles: 3 New Paths for Renewable Project Financing

Business, Business News/Analysis, Government Resources, Opinions, Policy, Resources, UK (United Kingdom)

February 11, 2014

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by Jim Lane (Biofuels Digest) Developers: is affordable project finance tough to find? Lenders: want to support green projects, but find that traditional deal structures defeat your best intentions? Help is on the way, via green bond principles and green bank formations that are expected to massively expand the pool of capital.
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Just recently, a consortium of investment banks announced their support of the Green Bond Principles – Bank of America Merrill Lynch, Citi, Crédit Agricole Corporate and Investment Banking, JPMorgan Chase, BNP Paribas, Daiwa, Deutsche Bank, Goldman Sachs, HSBC, Mizuho Securities, Morgan Stanley, Rabobank and SEB.
These Principles were developed with guidance from issuers, investors and environmental groups and serve as voluntary guidelines on recommended process for the development and issuance of Green Bonds. They encourage transparency, disclosure and integrity in the development of the Green Bond market.
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It is anticipated that an independent third party will be designated to serve as a secretariat whose administrative duties will include facilitating information exchange with issuers, investors, underwriters, and other stakeholders such as non-profit environmental organizations, non-government organizations, academics and other thought leaders.
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In New York, the $1 billion New York Green Bank initiative opened for business on February 5, 2014.
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Proposed projects, including those related to energy generation and energy savings, may include a wide range of commercially proven technologies, such as:
• solar PV and thermal
• onshore and offshore wind power
• fuel cells
• hydroelectric
• biomass
• biothermal energy
• biogas
• liquid biofuels
• tidal/ocean power
Nuclear, municipal solid waste combustion, and adulterated biomass or biofuels are excluded.
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Not to be outdone, the UK’s Green Investment Bank commenced operations in November 2012 and in its first five months Committed funds to 11 transactions with a total value of £2.3 billion, …
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The World Bank Green Bond raises funds from fixed income investors to support World Bank lending for eligible projects that seek to mitigate climate change or help affected people adapt to it. READ MORE and MORE (Green Bond Principles) and MORE (Green Investment Bank) and MORE (World Bank)

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