Renewable energy champ EDC raises P5B from green bonds offer

After nearly a decade of absence in the debt market, the Energy Development Corp. (EDC) yesterday successfully raised P5 billion from the issuance of fixed-rate Asean (Association of Southeast Asian Nations) Green Bonds for the financing of three clean energy projects.

This is the first tranche of a P15-billion shelf registration greenlit by the Securities and Exchange Commission (SEC).

The bonds had two tenors: the three-year issue fetched a yield of 2.8565 percent per year; and the five-year issue, 3.7305 percent a year. Both tenors were made available on Friday at the Philippine Dealing and Exchange Corp. system.

The SEC gave the go-ahead for a combined issuance of P3 billion and an oversubscription option of up to P2 billion.

During the listing ceremony, EDC president and chief operating officer Richard Tantoco said due to strong demand from investors, the offer was more than 10 times oversubscribed, allowing EDC to raise the full P5 billion. Partial funding

“Through the Asean Green Bonds, the public is able to support and participate in financing renewable energy projects, which is aligned with our mission of forging collaborative pathways for a decarbonized and regenerative future,” said Tantoco. Asean Green Bonds are issuances that conform to standards set by regulators through the Asean Capital Markets Forum. Proceeds are to be used exclusively for projects that contribute to environmental goals, such as climate change mitigation.

The P5 billion that EDC raised would be used, in particular, for the partial funding of three projects: the 29-megawatt Palayan geothermal generator in Albay, the 3.6-MW Mindanao 3 geothermal plant in North Cotabato and the 120-MW Aya hydro facility with a battery component in Nueva Ecija.

‘Right direction’

“Being the first SEC-registered [peso-denominated] Asean Green Bond issuance by a power company in the Philippines [and add to this] the overwhelming reception of the bond investors considering our last bond issuance was eight years ago back in 2013, indicate that we have taken a step in the right direction of going full steam ahead with our bullish growth plans,” Tantoco said.

He said the funds raised would enable EDC to expand its green energy portfolio, which in turn could help the Philippines achieve its goal of reducing carbon emissions by 75 percent by 2030. Aside from geothermal and hydro assets, this subsidiary of the Lopez-led First Gen group also operates solar and wind farms, all of which total 1,480 MW of generating capacity. INQ