Focus Session

Green bonds for hydropower

Bringing standards to the green bond market and what it means for hydropower

Thursday 16 May 2019 | 11:15-12:30

Green bonds are examples of the emerging instruments for green finance and investment in the energy sector that can be used for hydropower. They are fixed income loans created to specifically finance and refinance projects and assets that help address environmental and/or climate risks and shift investment to a low carbon, sustainable economy. In 2017, over USD 160 billion of labelled green bonds were issued, nearly doubling the previous year with expectations that it could reach USD 1 trillion by 2020.

Following over two years of discussions with industry, academia, governments and international NGOs, the Climate Bonds Initiative, an investor-focused not-for-profit is due to launch a consultation later this year on proposed green bond criteria for hydropower. This criteria is seen as key to fully unlocking the market to the hydropower sector, as to date it has been held back a lack of clarity over appropriate standards.

Session objectives:

What role will the green bond market have in the future of hydropower financing?

This session will focus on how the eligibility criteria has been applied to date, highlighting projects which will benefit from green bond financing and what advantages issuers receive from doing so. Panellists will also explore how the green bond market helps better align the sector with both the Sustainable Development Goals and the Paris Agreement. Finally, panellists will discuss how the criteria may evolve over time to take into account improved methodologies and the latest in climate science.

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