EF BRIEFS: SocGen, Barclays, Trina, Enel, GIB, Camco, Capital Stage, IIGCC, GE and Alstom

18 November 2015

SocGen moves away from coal as it adopts climate targets

Societe Generale has adopted a climate policy ahead of the Paris climate summit that will see it pull out of some coal financing and double financing for renewables by 2020.

The French bank said the measures will enable it to comply with the International Energy Agency's scenario for restricting global warming to 2°C above pre-industrial levels.

SocGen will reduce its activities in the coal sector, and will no longer project finance coal-fired power plants in OECD countries or the development of coal mines.

It will also adopt the Banking Environment Initiative's Soft Commodities Compact with the Consumer Goods Forum to help fight deforestation.

The bank is putting in place a framework to monitor its climate-related actions, and said it will provide more information at the climate summit in Paris next month.

Barclays achieves green bond target, doubles pledge to £2bn

Barclays has become the first bank to fulfil its spending pledge to the green bond market, resulting in the doubling of its commitment to £2 billion ($3 billion).

The bank announced last year that it would buy £1 billion of labelled green notes from sovereigns, supranationals and agencies by November 2015. It will now invest a further £1 billion.

"As the green bond market matures this instrument presents an increasingly powerful proposition and one that has the potential to push green projects including renewables forwards at pace," said Tushar Morzaria, group finance director at Barclays.

Last week, HSBC joined the list of financial institutions making treasury commitments to green bonds. However, it did not put a time limit on its pledge to buy $1 billion of notes. Zurich and Deutsche Bank also have similar targets.

Trina lands $90m of bank finance for US and Asian expansion

Solar giant Trina has bagged $90 million of financing from Wells Fargo and Barclays to help it expand in the US and Asia.

The Chinese firm, which manufactures solar modules, has secured a $60 million, five-year revolving loan, via its US subsidiary, from Wells Fargo. The proceeds will be invested into the company's US operations.

In addition, its Singaporean arm has agreed a $30 million credit line with Barclays. This will be used "to better capture growing opportunities in the Asia-Pacific region", the firm said.

Teresa Tan, chief financial officer of Trina, said the deals reflected "the growing confidence that premier global banks have in our business operations".

UK's GIB makes first international investments as part of new JV

The UK's Green Investment Bank (GIB) will make its first ever investment outside the country, focusing on projects in Asia and Africa.

The bank, through its new partnership with the UK Department for Energy and Climate Change, will invest up to £200 million ($304 million) in renewable energy and energy efficiency ventures in emerging markets.

Its initial target countries include India, South Africa, Kenya, Rwanda and Tanzania, "where demand is high for new generation capacity and renewables present a competitive alternative to fossil fuels, all have the right conditions to attract low-carbon investment", according to a statement put out by the partnership, which was officially launched last week.

The joint venture, known as UK Climate Investments, has already agreed at least one investment as part of the pledge – to finance the construction of a number of solar farms in India. It has a pipeline of other projects, it added.

Its role is to invest in projects on commercial terms, in order to 'crowd in' private sector finance, just as it does in the UK.

Shaun Kingsbury, CEO of the GIB, said: "We believe that our business model works, and that adopting it in emerging economies could pave the way for more, much-needed investment in reliable green infrastructure projects in these developing nations

Societe Generale prices €500m green impact bond

Societe Generale has priced its five-year €500 million green ($531 million) impact bond.

The bond, which has a coupon of 0.75%, was priced at mid-swaps +60 basis points. The French bank did not increase the size of the bond despite the order book being just over six times oversubscribed.

Enel plans to delist renewables arm in deal worth €3.1bn

Enel has offered to buy all the outstanding shares in its listed renewables spinoff, Enel Green Power (EGP).

The Italian utility will issue shares worth €3.1 billion ($3.3 billion) and use proceeds from the sale to repurchase EGP, which Enel's CEO referred to as a "growth engine".

In 2010, Enel listed EGP for €2.26 billion. However, it now plans reintegrate the business, after a recent rise in its earnings.

Camco sells US biogas assets to focus on batteries

Camco Clean Energy has agreed to sell its US biogas assets for up to $5.6 million, to help it refocus its activities on energy storage.

The London-based company said the deal will leave it with "materially enhanced resources and a debt-free balance sheet".

Camco will sell its entire interests in AG Power Jerome and AG Power DCD, which both turn cow manure into biogas, to Clean Power Holdings, a Delaware-based biogas operator.

Indian railway giant readies itself for green bonds

Indian Railways, one of the biggest transport networks in the world, is eyeing the green bond market, according to reports.

A senior official at the state-owned company reportedly said the asset class could help fund cleaner and more energy-efficient railways.

The claims are backed up by a tweet from the London Stock Exchange, saying it was "ready to become home for rupee bonds & help finance railways - economic lifeblood of india". The exchange recently listed the IFC's masala green bond, and has a number of segments dedicated to the market.

Indian Prime Minister, Narendra Modi, visited the UK last week, during which time he addressed a series of issues relating to the two countries' efforts to transition to a low-carbon economy.

Germany's Capital Stage boosts wind portfolio with €70m acquisition

German renewables operator Capital Stage has bought a windfarm in a deal worth €70 million.

The firm bought the 38.5MW site in Germany from Energiekontor AG, and the transaction includes an undisclosed portion of debt – inclusive in the €70 million figure. The existing financing for the site is being retained.

The project is slated for operation this month, and is eligible for a 20-year feed-in tariff from the German government.

Capital Stage's wind portfolio has increased by over a third as a result of the deal, taking it to more than 100MW. Its total capacity – including its solar fleet, which accounts for around 80% of its assets – is almost 550MW.

Investors' guide to engaging with miners on climate change

A network of more than 270 institutional investors has published a guide to drive closer engagement with mining companies about their management of climate risk.

Investor Expectations of Mining Companies – Drilling Deeper into Carbon Asset Risk, is designed to help investors deal areas of concern including governance, operational efficiency and emissions, strategy and preparedness for dealing with the impacts of climate change.

It has been put together by the Institutional Investors Group on Climate Change with support from investor networks in North America (Ceres' INCR), Australia (IGCC) and South East Asia (AIGCC).

GE buys Alstom's renewables business

General Electric (GE) has bought Alstom's renewable power and grid businesses that will "significantly" expands its wind activities.

The deal will see GE's installed base grow by approximately 50%, in Europe alone.