The trend toward sustainable investments continues to grow steadily: for international investors, the topic of sustainability in their investment decisions is becoming increasingly important. For bondholders, ‘green bonds’ – fixed-income securities whose issue proceeds are used to finance sustainable investment projects – are at the center of this development. Thus, the interest of analysts and investors was outstandingly high when E.ON’s CFO Marc Spieker and E.ON’s COO for Energy Networks Thomas König presented the new E.ON Green Bond Framework in an international investor call for institutional bond investors on 1 March 2021.
The new E.ON Green Bond Framework differs in one key aspect from the previous framework, which E.ON published in 2019: in addition to the full alignment with the so-called ICMA Green Bond Principles, which today set the standard for green bonds in the capital market, the new E.ON Framework is also the first across Europe to fully comply with the criteria of the EU Taxonomy on sustainable economic activities and the Draft Delegated Act. The EU Taxonomy defines which economic activity is classified as environmentally sustainable and thus sets a Europe-wide standard for sustainable investments.
E.ON’s Green Bond Framework focuses on sustainable projects in both the Energy Networks as well as the Customer Solutions business. Power grids play a key role in the energy transition. They form the central platform for successful decarbonization in Europe and are therefore EU taxonomy-compliant, with the exception of grid connections for CO2-intensive generation plants. Under the new Green Bond Framework, E.ON will first include its German and Swedish power grids, which already allow renewable energy to be fed into the grid to a very large extent. From the Customer Solutions segment, projects such as highly efficient combined heat and power solutions that E.ON develops for industrial or municipal customers, such as in its Swedish Medicon Village project, shall be included. Investors thus have the opportunity to participate specifically in the (re-)financing of sustainable projects of the E.ON Group that comply with the Green Bond Framework.
E.ON’s Green Bond Framework and the Second Party Opinion (certification by the renowned rating agency Sustainalytics) can be viewed online at: https://www.eon.com/greenbond.
Marc Spieker: “Over the past years, E.ON has established green financing as a core element in its funding strategy. With our updated Green Bond Framework, we create a platform to use green bonds as an integral part of our financing mix also going forward. We expect to cover more than 50 percent of our annual funding requirements with green bonds going forward. We are very proud that our new Green Bond Framework is the first corporate framework to be completely aligned with the current version of the EU Taxonomy and its Delegated Act. E.ON highly appreciates that with the EU Taxonomy and the draft EU Green Bond Standard, the EU fosters a way towards harmonized assessment criteria for sustainable investments.”
Thomas König: “Electricity Networks play a key role for the energy transition and serve as the central platform to make the transition towards a more sustainable and decarbonised society a success. Applying smart technologies and consequently fostering the digitalisation of grid infrastructure allows us to manage our existing grids at high efficiency and at the same time expand our networks in a resource-efficient way. With our new Green Bond Framework, we give investors the opportunity to support us in making our energy systems cleaner and smarter and allowing us to supply our customers with green energy more efficiently.”