Irish MEP Brian Hayes has called on the Government to follow the example of France and Poland by issuing sovereign green bonds to help finance renewable infrastructure projects and to send a signal that environmental issues are a "national priority" for the Republic.
On Tuesday France issued its first “green bonds” with a record €7 billion sale. The proceeds from the 22-year bonds will be used to finance projects to address climate change.
Poland was the first country to enter the green bond market with a €750 million issuance in December, while the world's first platform for trading environmentally-friendly securities was launched last year by the Luxembourg Stock Exchange.
The market for green bonds has taken off in recent years, with $42 billion issued in 2015, compared with $11 billion in 2013. Previously they had been issued by companies or institutions such as the World Bank.
Mr Hayes said the time was “ripe” for the Government to “proactively engage in climate-friendly initiatives” such as green bonds. “The Paris climate agreement means that all governments need to do their part to reduce dependency on fossil fuels.”
Initiatives
Mr Hayes said there were two concrete initiatives that we could pursue immediately. “Firstly, the
Department of Finance
, in conjunction with the
National Treasury Management Agency
, should ensure that we issue Ireland’s first green bonds before the end of 2017.
“Secondly, we should be able to put a clear date on the phase-out of Moneypoint [Co Clare], Ireland’s only coal-fired power station, which is running at high capacity and provides about 21.5 per cent of our electricity needs.”
When asked by The Irish Times if it had any plans to issue green bonds, a spokesman for the NTMA said: "At the end of 2016 the NTMA announced its funding plans for 2017, and earlier this month we issued €4 billion of a new 20-year benchmark. We continuously review developments in the market to ensure that the range of instruments optimises Ireland's position as a sovereign issuer.
“We have previously stated our intention to diversify our issuance over the long term, which may include green bonds along with other instruments such as inflation-linked bonds.”
