Market Blog #19: USD167.3bn total 2018 green bond issuance - USD11bn GBs in Dec alone: 1st GB from
Icelandic city: 1st sovereign blue bondHighlights:••••

USD11bn green bonds in December
City of Reykjavik issues first green bond from an Icelandic local government
Republic of Seychelles issued first sovereign blue bondFannie Mae publishes Green MBS and Credit Facility deals for December: USD1.8bn

Don’t miss:Climate Bonds’ 2018 Green Bond Market Summary provides preliminary figures for2018 issuance, trend analysis, underwriter & trading venue league tables and more!
Download now!

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The USA, China and France record top 3 country volumes in 2018
40
2018

35

140
Cumulative issuance (RHS)120

USD Billions

30

100

25

80

20

60

15
10

40

5

20

0

0

Climate Bonds Initiative © 20192018 Issued

167.3 Bn

USD Bn0

100

484 Bn200

300

521 Bn400

Go here to see the full list of new and repeat issuers in December.

500

Total Outsanding
600

Total Issued

2018 Green Bond Market Summary
Preliminary end of year figures show 2018 global green bond issuance reached USD167.3bn, surpassing
2017 figures by 3%. 2018 has also seen the rise of sustainability, SDG and social bond issuance, which if
added to the total green bond figure take 2018 volumes to USD202.5bn.
Financial corporates fuelled issuance with USD49bn worth of green bonds, or 29% of the annual total, up
from 14% in 2017. This is the first time since market inception that financial corporates represent thelargest share of annual volumes. Industrial Bank Co, ING and ICBC accounted for almost a third of thesegment’s total. More broadly, greater volumes from banks bode well for the growth of the green loan
market and green finance generally.
Sovereigns deals kept a strong pace throughout the year taking up a 10.5% share of the market, up from
7% last year. Deals came from Belgium, France, Ireland, Indonesia, Lithuania, Poland and the Seychelles.
Certified Climate Bonds totalled USD23.3bn and accounted for 14% of 2018 volumes, or on par with 2017.
Almost half of Certified deals by volume were USD1bn or above in size - compared to just 25% in 2017 –with ING breaking the record for largest Certified Climate Bond with its USD2.95bn deal.
Download the full 2018 Green Bond Market Summary here.

Green bonds by issuer type
160
140
120
100
80

Issuance by issuer type - Evolution

ABS

100%

Financial corporate

90%

Non-financial corporate80%

Development bank
Local government

70%

Government-backed entity

60%

Sovereign

50%

Loan

40%

USD Billion

60

30%

40

20%
20

10%

0

0%
2014

2015

2016

2017

2018

2014

2015

2016

2017

2018

Climate Bonds Initiative © 2019

> The full list of new and repeat issuers here.
> Click on the issuer name to access the new issue deal sheet in the online bond library.

New issuers
Bank of Dalian Co., Ltd. (CNY2bn/USD290m), China, issued a 3-year green bond, which benefits from an EY
Assurance (not publicly available). Proceeds will finance 11 projects in the transport and water treatment
sectors. An example project identified by the issuer, is the manufacture of new energy vehicles and corecomponents as well as charging and replacing operations. Another example, is the construction of a sewage
treatment plant and supporting sewage collection pipe network.

Climate Bonds view: We encourage issuers to disclose more details on financed projects and makeexternal reviews publicly available to enhance transparency.
Chongqing Three Gorges Bank (CNY3bn/USD436.9m), China, issued a 3-year green bond benefiting from a
CECEP Second Party Opinion (not publicly available). Proceeds will be allocated to eligible projects in four
categories: (1) energy saving, (2) pollution prevention, resource conservation and recycling, (3) clean energy and (4)ecological protection and adaptation.

Climate Bonds view: Eligible projects include hydropower. Since it accounts for just 3% of total proceeds
and the other areas where the funds will be allocated are aligned with both the PBoC catalogue and CBITaxonomy, the bond has been included in our database. Further analysis will be carried out when thequarterly green bond report comes out, and it will be excluded if the actual use of proceeds fails to meetour green bond definitions.
City of Reykjavik (ISK4,1bn (USD33m), Iceland, issued a 30-year senior unsecured green bond, becoming
the first Icelandic local government issuer to come to market. The deal is also the first green bond to belisted on Nasdaq Iceland’s Sustainable Bonds List. CICERO provided the Second Party Opinion.
According to the Green Bond Framework, 70-100% of the first deal will be used to refinance recent eligible
projects falling under various categories including buildings, transport, waste, land use and adaptation. As
well as having obtained a BREEAM certification of ‘Very Good’ or above, green buildings are required toinclude a screening for climate risk and resilience in the property design, derive 100% electricity andheating from renewable sources, and present solutions for a car-free living and electric charging stations
fuelled with 100% renewable energy sources.
Climate Bonds view: The City of Reykjavik has a good set of commendable targets, and its Green Bond
Framework receives a Dark Green shading in CICERO’s SPO. In addition to green buildings, it would be good
to see more quantifiable requirements for projects in other areas.
City of St Louis Park (USD43.7m), USA, issued a 34-year green US Muni bond. The proceeds will be used tofinance the acquisition, construction and fit out of a multifamily housing project, which is expected toobtain a LEED Gold certification. It is estimated that energy bills for new tenants may decrease up to 45%.
This investment will be made indirectly by the borrower PLACE E-Generation One, LLC and the construction
phase should end by January 2020.
Climate Bonds view: LEED certified buildings are already representing a consistent amount of the projects
financed through green bonds. With world population increasing, cities getting denser, and higher global
environmental footprint, investments in energy efficient buildings are increasingly important.
Endesa, S.A (EUR335m/USD382m), Spain, came to market with a debut green loan – the first of its kindseeing the European Investment Bank (EIB) as the sole lender. The deal will finance the development of 15
wind farms with a capacity of 446MW and three solar photovoltaic plants with a capacity of 339MW. The
loan follows Endesa being awarded 540MW of wind energy and 339MW of photovoltaic energy in theauctions for new renewable electricity generation facilities that took place in Spain in May and July 2017,
which will involve an investment of over EUR800m until 2020.
Climate Bonds view: Given Iberdrola’s established presence in the green bond market, and following EDP’s
inaugural green bond in October 2018 as well as Gas Natural Fenosa’s first in November 2017, Endesa’sgreen loan seems to be part of a shift towards green financing by Iberian electricity companies. We expect
these issuers to continue accessing green financing, and potentially other similar issuers to do the same.
Enercity (EUR100m/USD113m), Germany, issued a 10-year digital green Schuldschein benefiting from a
Vigeo Eiris Second Party Opinion. Proceeds from enercity’s first green and digital promissory note willrefinance the acquisition of 17 operational wind farms, located across Germany. With a total of 142
turbines, the total combined output of the farms is around 219MW.
Climate Bonds view: This is the second Schuldschein to have been issued under a digital format after
Verbund AG deal in April 2018. The use of blockchain technology in the execution of deals could be thenext chapter, but more broadly the Schuldschein structure retains its appeal among corporate and financial
sector issuers given the well-established debt format and its flexibility.
Power Construction Corporation of China (CNY747m/USD108.7m), China, issued a 3-year green bond. Thisis the second green ABS deal in the market that is backed by feed-in-tariff on renewable energy after State
Power Investment Corporation’s deal issued in November 2018.
Climate Bonds view: We included this deal since the underlying cash flow is related to low-carbon assets.
We will also keep tracking the use of proceeds when more information is available.

New deals issued prior to December 2018
Bank of Guiyang (CNY5bn/USD731.9m), China, issued a 3-year green bond in August 2018. Lianhe Equator
provided the Second Party Opinion (not publicly available). All proceeds will be allocated to three
categories that are eligible under PBoC’s green bond catalogue: (1) pollution prevention, (2) ecologicalprotection and adaptation, and (3) resource conservation and recycling. All projects to be financed are
expected to deliver climate and environmental benefits, such as reduction of chemical oxygen demand(COD) by 27000t/a, SOx emission reduction by 2.91t/a, etc. Sample projects include the construction of two
sewage plants and supporting infrastructure, a project that aims to enhance wetland protection andrestoration, and a hydropower project that will also provide irrigation and drinking water supply for thesurrounding areas.
Climate Bonds view: Thinking around hydropower has evolved and the Climate Bonds Taxonomy publishedin September 2018 now identifies a power generation metric and controversies as aspects to consider inassessing bonds which finance hydropower generation. This deal has been included, as the hydro project
falls under the ecological protection and adaptation category, and includes works such as drainage cleaning
and flood control. Further, the hydroelectric power generation forms a relatively small component andonly utilises surplus water released from the reservoir. However, proceeds will be used for resettlement,
indicating potential controversies, so we will keep tracking the quarterly green bond report.

Bank of Ningbo Co., Ltd (CNY3bn/USD432m), China, issued a 3-year green bond in October 2018, which
benefits from an EY Assurance Report (not publicly available). The proceeds will be allocated to 14 projects
under four categories: low carbon transport (buses and public transport systems), waste water treatment(existing waste water treatment facilities expansion and new facility development), recycling and water
management (flood defence and water treatment). The issuer has disclosed examples of eligible projects,
as well as detailed impact metrics.
Climate Bonds view: The financed projects are aligned with the Climate Bonds Taxonomy and the issuer
shows commitment to align to best practice by including expected impacts of projects at issuance.

Boston Properties (USD1bn), USA, issued a 10-year unsecured green bond in November 2018. The deal will
finance recently completed or future properties that have or are expected to obtain a green building
certification. Eligible projects include the Salesforce Tower development located in San Francisco,California, which has received LEED Platinum certification.
Climate Bonds view: The deal was previously classified as pending until the issuer confirmed that the green
building certification is a requirement for all properties in the portfolio of eligible projects. Issuers arestrongly encouraged to set up clear tracking and reporting systems, as well as seek for external reviews tocomply with market best practice.
China Kangfu International Leasing (CNY1.856bn/USD267m), China, issued a 9-year green ABS in
November 2018. There is limited disclosure on this green ABS. The 5-tranche deal is backed by leases on
solar assets. Proceeds will be allocated to distributed solar and wind projects.
Climate Bonds view: The deal follows Shanghai Stock Exchange’s rule which requires at least 70% ofproceeds to be used in green sectors. It appears that part of the proceeds is in cash. However, the deal isconsidered as eligible because the underlying cash flows relate to low-carbon assets, but also the proceedsfrom the deal are earmarked for investment in low-carbon assets. Still, we encourage the best practise
where both collateral and use of proceeds are invested in green assets.
Region of Pays de la Loire (EUR75m/USD87m), France, issued a two-tranche green bond in October 2018
which benefits from a Vigeo Eiris Second Party Opinion (longest dated bond: 15 years). According to theGreen Bond Framework, proceeds will be earmarked to finance eligible projects under three categories:
energy, buildings and transport.
Renewable energy projects must be related to solar, wind, marine energy, biomass, geothermal,
photovoltaic, electric, wood, biogas and ocean energies. To be eligible, public buildings must meet at least
one of several standards, including the Réglementation Thermique 2012 (RT2012) – a standard requiringthat new building work attains an energy efficiency performance three times greater than the existing
standard – and a ‘Very Good’ HQE certification. Private buildings must also meet the RT2012 standard andrenovations have to yield at least a 40% energy performance improvement. Eligible projects under thetransport sector include electric and hybrid cars, rail transport and infrastructure for clean energy vehicles.
Climate Bonds view: The bond was previously placed as pending due to insufficient information involving
biomass and biogas projects. However, as it is only one of several renewable energy technologies listed as
eligible and as the examples of qualifying projects mainly involve solar and marine renewables, we assume
that bioenergy projects represent a limited share of proceed allocations. Nevertheless, we will keep
monitoring proceed allocation reporting to ensure that either biomass projects use exclusively sustainable
feedstock or that financing allocated to the projects is at most 5% of the bond’s proceeds.
State Power Investment Corporation limited (CNY1801m/USD258.9m), China, issued a two-tranche green
ABS (longest dated deal: 3 years). Information about the deal structure and use of proceeds is very limited.
According to the news release, however, this is the first green ABS deal from China that uses feed-in-tariffs
on renewable energy as collateral.
Climate Bonds view: As the deal is backed by feed-in-tariff linked to renewable energy, it is fully alignedwith CBI’s definition of a green ABS, where the underlying cash flows relate to low-carbon assets. Further
analysis will be done on the type of renewable energy and use of proceeds when more information
becomes available through quarterly and annual reporting.

The Republic of Seychelles (USD15bn) issued the world’s first blue sovereign bond in October 2018 in theform of a private placement. As set out in the project appraisal document, proceeds will be allocated toeligible activities related to sustainable fisheries and marine projects, including the expansion of marine
protected areas, improved governance of priority fisheries and development of the Seychelle’s blue
economy. The bond is backed by a World Bank partial guarantee of USD5m, as well as by a USD5m
concessional loan from the Global Environment Facility (GEF) to partially cover the deal’s interest
payments. According to the World Bank, fisheries are the country’s second most important industry after
tourism, employing 17% of the population and make up around 95% of the total value of domestic exports.
Climate Bonds view: The blue bond has been included in the CBI green bond database as the financed
projects are aligned to the Land Use & Marine Resources sector of the Climate Bonds Taxonomy. As
underlined by the World Bank, fisheries and marine resources are a key component of the Seychelles
economy, as well as representing an example of valuable water resources at risk of being impacted by theeffects of climate change. The world’s first blue bond is therefore a great example of how finance flows canbe directed towards implementing resilience and adaptation measures to preserve fisheries and water
ecosystems.
➢ The Fisheries & Aquaculture Criteria are in the process of being developed and will provide
screening metrics and benchmarks to indicate low carbon and climate resilient fisheries.
➢ The Adaptation and Resilience Expert Group (AREG) was launched in November 2018 and the
Adaptation and Resilience Principles are expected to be opened for public consultation in June
2019.
University Properties of Finland (EUR100m/USD114m), Finland, issued a 5-year green bond in November
2018, becoming the first Finnish issuer from the real estate sector to debut in the green bond market.
CICERO provided the Second Party Opinion. Proceeds will be earmarked for the financing of new or existingbuildings certified as BREEAM ‘Very Good’ and with energy use 15% lower compared to the Finnish
national building code, energy efficiency projects yielding at least 25% reductions in energy use, renewableenergy solutions to satisfy property energy needs and electric vehicle infrastructure.
Climate Bonds view: This is the only green bond to come to market from a Finnish issuer in 2018. With thisdeal, Finland’s cumulative issuance stands at USD1.4bn. The deal was previously classified as pending due
to insufficient information related to energy efficiency projects. The issuer has now confirmed that energy
efficiency improvements to fossil fuel technologies are not eligible under the green bond framework.
Yancheng City Haixing Investment Company, Ltd. (CNY100m/USD14.79m), China, issued a 5-year privately
placed green bond in November 2018. According to the very limited disclosure, all proceeds will be used
for a Water Environment Improvement Project in Xintan Area in eastern China’s Yancheng city.
Climate Bonds view: The project falls under the ‘Supply management & water treatment’ section of ourgreen bond taxonomy therefore aligned with our definition. However, the disclosure of more details on theuse of proceeds and impact reporting is strongly encouraged.

Repeat issuers••

China Three Gorges Corp: CNY3bn/USD436m - previously classified as pending due to insufficient
information on hydro projects
China Three Gorges Corp: CNY1bn/USD146m and CNY2.5bn/USD366m – issued in August 2018 andpreviously classified as pending due to insufficient information on hydro projects

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•
•
•
•
•
•

Chongqing Qianjiang Urban Investment: CNY700m/USD101m
Fannie Mae: USD1.8bn
Greenalia Wind Power Eolo S.L.: EUR156/USD177m
Huaneng Tiancheng Financial Leasing: CNY600m/USD87m – issued in November 2018
Iberdrola: USD50m
IFC: USD100m – issued in October 2018
Mexico City: MXN1.1bn/USD54m – issued in November 2018
Modern Land: USD150m
World Bank (IBRD): USD600m – issued in November 2018 and previously classified as pending due
to insufficient information

Repeat issuers account for 78% of December issuance

0

1

2

3

4

5

6

7

8

9

10

11
12
USD Billions

China Three Gorges Corp

Chongqing Qianjiang Urban Investment

Greenalia Wind Power Eolo S.L.

Modern Land

Fannie Mae

Huadian Fuxin Energy Corporation Limited

Iberdrola

Wuhan Metro

Sumitomo Mitsui Banking Corp

Louisiana LCDA

Renewi (formerly Shanks Group)

World Bank (IBRD)World Bank (IBRD)

Toda Corp

Mitsubishi UFG

New York State Housing Finance Agency

NWB Bank

HSBC

Huadian Fuxin Energy Corporation Limited

Bank of Guizhou

Longyuan PowerEUROFIMADividend Finance

Credit Agricole CIB

AfDB (African Development Bank)South Carolina Jobs-Economic Development Authority

New issuers

Pending and excluded bonds
We only include bonds with at least 95% proceeds dedicated to green projects that are aligned with the
Climate Bonds Taxonomy in our green bond database. Though we support the Sustainable Development
Goals (SDG) overall and see many links between green bond finance and specific SDGs, the proportion ofproceeds allocated to social goals needs to be no more than 5% for inclusion in our database.
Issuer Name

Amount issued

Issue dateReason for exclusion/
pendingNaturgy Energy Group SA
BRL130m/USD35m(formerly Gas Natural Fenosa) BRL135m/USD36m
Development Bank of Japan
EUR700m/USD806m

31/10/2018

Unlabelled

10/10/2018

Unlabelled

Credit Agricole CIB

USD4m

28/09/2018

Unlabelled

Credit Agricole CIB

USD1m

21/09/2018

Unlabelled

Credit Agricole CIB

USD1m

28/09/2018

Unlabelled

Credit Agricole CIB

20/07/2018

Unlabelled

Credit Agricole CIB

EUR5m/USD6m;
SK10m/USD1m
INR354m/USD5m

08/08/2018

Unlabelled

Credit Agricole CIB

USD1m; USD1m

28/09/2018

Unlabelled

AfDB

05/09/2018

Unlabelled

AfDB

BRL5m/USD1m;
BRL5m/USD1m;
IDR30bn/USD2m
INR96m/USD1m

27/09/2018

Unlabelled

Banco Galicia

USD100m

23/03/2018

Not aligned

Asian Development Bank

HKD200m/USD25m

25/05/2018

Unlabelled

MTR

HKD348m/USD44m

28/06/2018

Unlabelled

Bank OCBC NISP

USD150m

01/08/2018

Not aligned

South Carolina Jobs-Economic USD11m
Development Authority
Grand Forks County
USD43m; USD18m

16/08/2018

Not aligned

28/08/2018

Not aligned

Shinhan Bank

KRW200m/USD0.2m

30/08/2018

Not aligned

Sinohydro Bureau 8 Co.,Ltd.

CNY220m/USD32m

27/12/2018

Working capital

Hunan Expressway Co

CNY2bn/USD307m

26/10/2018

Not aligned

Adelaide Airport

AUD50m/USD36m

20/12/2018

Corporacion Andina de
Fomento (CAF)
Corporacion Andina de
Fomento (CAF)
Fairfax County Economic
Development Authority
Bank of Dongguan

COP150bn/USD53m

25/05/2018

Sustainability/SocialbondInsufficient information

USD30m21/08/2018

Insufficient information

USD11m01/08/2018

Insufficient information

CNY2bn/294m

22/08/2018

Not aligned

AFD (Agence Française deDéveloppement)

EUR500m/USD584m

17/09/2018

Not aligned

Masdar

N/A

11/10/2018

Insufficient information

Bank of Chongqing

CNY3bn/USD432m

23/11/2018

Not aligned

Bank of Chongqing

CNY3bn/USD434m

07/11/2018

Not aligned

Beijing Enterprises Clean
Energy Group Limited
Hainan Tihierg Co., Ltd

CNY1bn/USD144m

27/11/2018

Working capital

CNY300m/USD43m

30/10/2018

Unlabelled

Northern Arc Capital

INR1bn/USD14m

25/12/2018

Pending

Tata Cleantech Capital

INR1.8bn/USD26m

18/12/2018

PendingPing An Financial leasing

CNY797m/USD114m

30/10/2018

Pending

Nippon Yusen Kaisha

JPY2bn/USD18m

27/12/2018

Pending

California Pollution Control
Finance Authority

N/A

19/12/2018

Pending

Green bonds in January
•
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ADB: AUD1bn – closing January 17
BNP Paribas: SEK12m – closed January 10
CDL Properties (City Developments Limited): SGD125m - closing January 17
Enel: EUR1bn – closing January 21
MidAmerican Energy: two tranches totalling USD1.5bn – closed January 9
Terna: EUR250m - closed January 10

Investing News
ResponsAbility-managed climate fund and Nam A Bank are teaming up to launch the bank’s green lending
activities in Vietnam. This would enable Nam A Bank to become Vietnam’s first private commercial bank tolaunch green lending products for medium and small clients (SMEs and individuals).
New York State Common Retirement Fund has added USD3bn to its Sustainable Investment Program,raising its total to USD10bn. The fund integrates sustainable, social and governance (ESG) principles into its
investment strategy.
The Asian Infrastructure Investment Bank (AIIB) announced that its board of directors has approved
USD500m for a credit portfolio that invests in corporate bonds to finance infrastructure investment. The
portfolio will comprise corporate bonds financing infrastructure projects, including quasi-sovereign andgreen bonds.
Ping An of China Asset Management (Hong Kong) plans to launch four new exchange-traded funds (ETFs) in2019. The company is looking into environmental, social and governance (ESG) as a potential thematic area
given the strong demand for Chinese green bonds‘Till next time,Climate Bonds

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websites are for information purposes only. The Climate Bonds Initiative accepts no responsibility forcontent on external websites.
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should be taken as such, nor should any information in this communication be relied upon in making any
investment decision.
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nor its compliance with national or international laws.
A decision to invest in anything is solely yours. The Climate Bonds Initiative accepts no liability of any kind,
for any investment an individual or organisation makes, nor for any investment made by third parties onbehalf of an individual or organisation, based in whole or in part on any information contained within this,or any other Climate Bonds Initiative public communication.