Thailand’s green bond potential has been recognised with the issuance of the country’s first Certified Climate Bonds which will finance solar power plants with the potential to generate over 140,000 megawatt-hours of clean energy per annum, as the country strives to achieve its 20% greenhouse gas emissions target.
Green bonds are a fixed-income debt instrument used exclusively to finance or refinance new or existing green projects with environmental or climate-related benefits.
Global green bond issuances in 2007 were around the $500 million mark, but by 2018 they had shot up to $167.6 billion, although there is still considerable growth potential for green bonds within global and regional bond markets.
Thailand, in particular, offers great opportunities for the development of an active green bond market because of its renewable energy potential and its active general bond market, which is the largest amongst Association of Southeast Asian Nations (ASEAN) members.
The Thai bond market’s annual issuance of long-term corporate bonds totalled 879 billion Thai baht (about $29 billion) in 2018, although to date, banks have been the main financiers of renewable energy projects. Thailand’s first green bond only issued in 2018, by Thai bank TMB.
Climate change and sustainable energy funding are hot topics disrupting the energy industry and are set for discussion at the Asian Utility Week and POWERGEN Asia conference. Click here to register to attend and for more information about the event.