Paris-based EDF has successfully launched the first green bond in euros by a major corporation.
EDF said the bond issue, with a total amount of 1.4 billion, an annual coupon of 2.25% and a maturity of 7.5 years, was twice oversubscribed.
Institutional investors were particularly attracted to the bond, while investors considering environmental, social and corporate governance (ESG) criteria in their investment decisions specifically accounted for 60% of the issuance allocation.
EDF spokesperson Alison Marquilly told pv magazine that "the green bond launched by EDF should be dedicated for approximately 25% to solar energy and approximately 75% to wind energy." Of these projects, she said, "some have been pre-identified, but not all of them."
Marquilly added that all projects would have to comply to specific ESG criteria defined by Vigeo, a European ESG rating agency. According to EDF, all "selected projects will have to comply with the eligibility criteria drawn up by the Vigeo, which cover five areas related to environmental and social impacts."
EDF’s 1.4 billion green bond follows a 2 million investment EDF dedicated to the development of 1.55 GW of renewable energy capacity in 2012. The group’s installed renewable capacity at the end of September 2013 stood at 6.4 GW.
All solar PV and wind energy projects financed by the green bond funds will be led by EDF Energies Nouvelles, a wholly-owned EDF subsidiary since 2011.
The company hopes the initiation of the green bond will pave the way for new channels of financing for other EDF businesses, such as hydropower and energy services.