Iberdrola Draws €8 Billion Order Book for First EuGB-Aligned Hybrid Green Bond – ESG Today

World power and electrical energy supplier Iberdrola introduced that it has raised €1 billion (USD$1.16 billion) within the first-ever providing of a hybrid inexperienced bond to be issued underneath the brand new European Inexperienced Bond (EuGB) customary.

The providing drew sturdy demand with an order e-book exceeding €8 billion from greater than 400 buyers throughout Europe and the UK, Asia and North America. In accordance with Iberdrola, the sturdy demand for the bond enabled the corporate to challenge greater than initially thought of, and considerably decreased the fee, with a coupon of three.75% – the bottom of all hybrid bonds issued thus far this 12 months.

The EuGB regulation was launched by the European Fee to determine a “gold customary” for inexperienced bonds, with a purpose to fight greenwashing and advance the sustainable finance market within the EU. The regulation went into impact in December 2024. Beneath the regulation, all proceeds from devices issued underneath the EuGB designation are required to be invested in financial actions which can be aligned with the EU Taxonomy, though the principles embody a flexibility pocket enabling 15% to be invested in financial actions that adjust to the taxonomy necessities, however in sectors that don’t but have established taxonomy standards, with issuers clearly explaining the place these funds will likely be allotted.

Corporations issuing bonds underneath the EuGB designation are additionally required to observe strict transparency standards, together with disclosing how the proceeds from the bonds will likely be used, in addition to committing to a inexperienced transition plan, and reporting on how the investments contribute to these plans.

Iberdrola is likely one of the largest company issuers of inexperienced bonds, utilizing the devices to fund tasks together with renewable power, power effectivity, clear transportation and waste administration. The corporate introduced plans in 2021 for its financing construction to have an more and more greater share of inexperienced and sustainable merchandise, estimated to account for almost two-thirds of its debt by 2025. In 2024, 94% of the financing signed by the corporate was sustainable, with the group’s sustainable financing as of the top of 2024 exceeding €60 billion.

In an announcement saying the outcomes of the providing, Iberdrola mentioned:

“The quantity of demand and the situations set as soon as once more exhibit the extent of confidence of the market and buyers within the soundness and solvency of the Group’s enterprise and development plans.”