Enel issues first SDG-linked bond and raises US$1.5 billion

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Enel, a leading private electricity company in the world by renewable installed capacity, has launched a “sustainable” bond for institutional investors on the US and international markets worth US$1.5 billion.

The funds, which were oversubscribed by almost three times, will be used by the company to create value through the increased generation of renewable energy and full decarbonization by 2050. Specifically, the company will support the following four Sustainable Development Goals (SDGs):

  • SDG 7 “Affordable and clean energy”, with over 11.6 GW of additional capacity;
  • SDG 9 “Industry, innovation and infrastructure”, with over 46.9 million smart metres installed and 5.4 billion euros of investment in innovation and digitalisation;
  • SDG 11 “Sustainable cities and communities”, with retail investment and new electrification-oriented energy services to achieve, among others, 9.9 GW of demand response capacity and 455,000 charging points for electric mobility;
  • SDG 13 “Climate action”, with a commitment to reduce carbon dioxide emissions to below 0.350 kg/kWheq in 2020 and full decarbonisation by 2050.

This bond issue, the first of its kind reflects the commitment of the company to contribute to the achievement of SDG 7.2 “Increase substantially the share of renewable energy in the global energy mix by 2030”. The bond issuance was supported by a syndicate of banks, including Bank of America, BNP Paribas, Citigroup, Goldman Sachs, J.P. Morgan, Morgan Stanley and Société Générale.

The UN Global Compact supported the issuance of the bond as a demonstration of the impact private businesses can have to implement the UN SDGs. According to the United Nations Conference on Trade and Development, investments of US$ 5 to 7 trillion are needed each year to realize the SDGs by 2030. While the public sector and public finance will be core to the implementation of the SDGs, it is widely acknowledged that the private sector and capital markets must also play a key role.

“The strong interest from investors shows that the demand for SDG investments is out there,” said Lise Kingo, CEO and Executive Director of the UN Global Compact. “We hope that SDG-linked bonds, like this one, will inspire a flood of innovative financial instruments and demonstrate that a mainstream market for investments in the Global Goals is possible. This is the kind of financial innovation that the world needs to make the 2030 Agenda for Sustainable Development a reality.”

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