London Stock Exchange welcomes IFC Green Bond
London Stock Exchange today welcomed IFC, a member of the World Bank Group, to mark the listing of IFC’s $500 million three year green bond. The bond, issued on November 17, is to support climate-smart investments in emerging markets.
This bond is issued under IFC’s Global Green Bond Program. Under the program, IFC has raised close to $4.5 billion over the past five years.
IFC will use the proceeds to support investments in renewable energy, energy efficiency, and other areas that reduce greenhouse emissions. Between July 2014 and June 2015 alone, 38 IFC investments received green-bond financing. These investments are expected to reduce greenhouse emissions by the equivalent of 2.5 million metric tons of carbon dioxide per year—a result similar to taking 500,000 cars off the road.
“Green bonds can play a powerful role in mobilizing additional funding to help fight climate change and reduce greenhouse gas emissions,” said Jingdong Hua, IFC Vice President and Treasurer. “IFC will continue bringing greater diversity, liquidity, and transparency to strengthen this important asset class.”
IFC is one of the world’s largest financiers of climate-smart projects for developing countries, with investments totaling about $13 billion over the last decade. For instance, Azure Power has received $45 million in equity and debt from IFC over the years to develop solar power in India, with a latest $14 million loan funded by proceeds of IFC’s Green Bond Program.
“IFC has provided funding that meets Azure Power’s growth needs at different stages,” said Inderpreet Wadhwa, Founder and CEO of Azure Power, during the market open ceremony. “IFC’s partnership is important for us to contribute towards realization of Honorable Prime Minister of India's commitment towards clean and green energy, through solar power generation. IFC’s green bonds program offers an innovative financing structure for raising efficient capital for solar projects and more specifically reducing the cost of solar power for millions of consumers in India.”
In Brazil, Enel Wind received a $300 million financing package from IFC to construct over 300 megawatt of wind power energy in 12 power plants in Brazil. This package includes a $200 million loan financed by IFC’s Green Bond Program
“Our partnership with IFC is an integral part of Enel’s plan to help Brazil meet its growing power demand through renewable energy solutions”, said Michele Calderoni, Head of Finance and Insurance, Enel Green Power SpA. “It will also support the development of the country’s Northeast region through job creation.”
IFC issues green bonds in various structures and currencies—including Chinese renminbi, Indian rupee, Japanese yen, South African rand, and U.S. dollars. This includes two benchmark $1 billion issues in 2013 that set a precedent as the largest green bonds in the market at time of issuance and helped solidify the market.
IFC is also one of the first issuers to publish a green bond impact report, providing an overview of the environmental and social impacts expected from eligible projects.