SSE issues largest ever green bond by UK firm
The green finance market has been buoyed by news that British energy company SSE has issued the biggest ever green bond by a UK company.
The €600m bond, announced earlier this week, provides capital be used to refinance SSE’s portfolio of onshore wind farms. SSE insists that the eight-year, 0.875% bond “reaffirms its commitment to tackling climate change”.
"In line with our innovative approach to financing investment and as major investor in the UK and Ireland’s renewable energy infrastructure, we are pleased this new issuance shows our commitment to SSE’s sustainability and responsibility principles,” SSE finance director Gregor Alexander said.
“At the same time we are being consistent with our commitment to maintaining a strong balance sheet and strong market rating, allowing this funding to be secured at very attractive pricing.”
A “significant demand” from socially responsible has allowed SSE to price at the “tighter end” of guidance, the company said.
The green capital market is a lucrative one – the UK share of the global low carbon financial services market could reportedly grow to up to £17bn per year in 2050.
A report from April revealed that 60% of the world's biggest investors are taking steps to protect their portfolios. The movement is being driven by fears in the financial sector that the next economic crash will be climate-related.
Earlier this year, the World Bank issued its first ever set of green bonds that directly link financial returns to companies performing to the standards and aims on the United Nation's Sustainable Development Goals (SDGs).
In June, Apple launched a dedicated funding stream to finance clean energy and environmental projects, through a $1bn green bond. Elsewhere, the world’s largest investor BlackRock recently unveiled its Green Bond Index fund, following a heightened investor demand for ESG fixed income securities and products.