Canada Pension Plan Investment Board (CPPIB) issued its first Euro denominated Green Bond. The sale of €1 billion in 10-year fixed-rate notes will enable CPPIB to invest further in eligible assets such as renewables, water and real estate projects, as well as diversify the Fund’s investor base.
Among the Green Bond-eligible investments recently made by CPPIB is a joint venture in renewable power and offshore wind assets. In 2018, CPPIB acquired 49% of Enbridge’s interests in two German offshore wind projects, alongside a 49% interest in some of Enbridge’s North American onshore wind and solar assets.
“The European market for Green Bonds is robust and gaining even more traction amid changes such as the EU’s increased targets for how much of the region’s consumed energy comes from renewable sources,” said Poul Winslow, Senior Managing Director & Global Head of Capital Markets and Factor Investing. “The capital raised will help finance our expanding portfolio of eligible green assets and demonstrate how we integrate environmental considerations into our investment decisions.”
This issuance follows CPPIB’s inaugural Green Bond in June 2018, the first such market offering from any pension fund. Investors bought $1.5 billion of the Canadian dollar-denominated 10-year bond.
CPPIB’s Green Bond Framework defines three categories as eligible for investment from Green Bond proceeds:
- Renewable Energy (wind and solar);
- Sustainable Water and Wastewater Management; and
- Green Buildings (LEED Platinum certified).
The aforementioned Framework has been evaluated by the Center for International Climate Research (CICERO), a world leader in providing second opinions on the qualification of debt for Green Bond status.