Dutch transmission firm TenneT eyes green bonds as part of €22bn investment plan

TenneT was the first non-financial company in the Netherlands to launch a green bond

Dutch grid connection firm TenneT, the national electricity transmission system operator of the Netherlands and a main operator in Germany, has said it will launch green bonds over the next ten years as part of a major onshore and offshore infrastructure investment programme projected to be €22bn in size.

It is not yet known how many or the sizes its green bond issues will be, but a spokesman for TenneT said it expected to issue some green bonds this year. He added their green bond sizes were normally around €1bn.

TenneT was the first non-financial company in the Netherlands to launch a green bond, issuing a €1bn note and it says this initial offering has the potential to “develop into an extensive multi-billion euro programme for financing investments in renewable energy projects”.

The countries where TenneT operates are making big advances in the offshore wind park space. Last month, a range of investors including German insurance giants Allianz and Munich Re made a bid for German wind park, Meerwind, valued at €1.6bn.

And in the Netherlands the Dutch Senate is debating draft laws which will see TenneT appointed as the country’s offshore grid operator. The Senate rejected a similar bill last year, resulting in the delay of 700MW in offshore wind energy bidding, planned for January of this year. But, a new revised bill is expected to pass by April 1.

The Dutch government wants to appoint TenneT to design, build and manage an offshore grid on the North Sea that will make 3,500 MW of renewable wind energy available for the Netherlands by 2023.In Germany, TenneT expects to have completed 7,100 MW of offshore connection capacity by 2019. The company will have an integral role in the success of the country’s Energiewende programme – Germany’s ambitious plan to transition to a green economy, with targets of renewables reaching 35% of national electricity demand by 2020. A spokesman said its €22bn infrastructure financing programme was part of facilitating Energiewende.

TenneT is doing a number of projects in Germany around the Energiewende, including building high-voltage networks to take wind and solar power from Germany’s coastal regions to its industrial parts.

The news on TenneT’s green bond plans, comes as it announces strong growth, with its operating profit increasing by 18% to €704m.

Separetly, Reuters reports that Hyundai has become the first carmaker globally to issue a green bond.

Hyundai Capital Services, the Korea-based auto financing and leasing arm of the Hyundai conglomerate, which is the umbrella group for Hyundai and Kia Motors, has issued the US-dollar denominated green bond to fund car loans for hybrid vehicles.

As well as being Hyundai’s first green bond, it’s also the first green bond issued in Korea.

Hyundai Capital Services received over US$1.2bn in orders. Fund mangers were the biggest buyers at 45%. Around 9% went to pension funds and insurers.

Bank of America Merrill Lynch was the green structuring agent. It also served as joint bookrunner with Citigroup and Credit Agricole.