Green Bond Market Heats Up
The green bond market is sitting at $200 billion (US) and as governments and organisations look to fulfil their sustainability targets it is estimated that this will continue to grow. Natalie Jackson explains.
Green bonds are long-term, fixed income, financial instruments with proceeds used to fund low-carbon projects or initiatives with positive environmental benefits.
Historically, renewable energy projects have been the main benefactor of investment. The funds raised through green bonds can be used to finance either new or existing projects.
The earliest green bond was issued in 2007, a AAA investment grade bond, by the European Investment Bank (EIB) and the Word Bank. The first corporate green bond was issued in November 2013, signifying a turning point in market growth. In October this year, Fiji became the first developing country to raise funds through a green bond.