Green Finance Framework's $300 million investment an Australian first
A NEW agreement will see $300 million in private funds invested in energy assets under a sector-leading Green Finance Framework.
Funding from the deal – the first to be made under the Framework – is intended to be used for electricity infrastructure assets, helping to ready them for increasing levels of renewable generation feeding into the grid.
General manager for corporate finance, Luis Castillo-Melendez said his team had worked with global investment bank Mizuho Securities to make the private placement of the eight-year medium-term note (MTN).
“We established our Green Finance Framework with the purpose of giving confidence to investors that they could back projects aimed at making a difference in lowering carbon emissions, so we’re very pleased to see the first investment made,” Mr Castillo said.
“It will also help us to respond to our customers’ preferences for renewable energy, and with upgrades to the network, how they use energy.”
Mizuho head of debt capital markets for Australia, Simon Ward said, “We are honoured to have executed this exemplary transaction – the first Green Bond by an Australian utility in global markets."
The Green Finance Framework applies to companies within the State Grid Singapore Power Australia Assets (SGSP Australia Assets) Group which include Jemena and engineering, project management, operations and maintenance company, Zinfra.
It aligns with Jemena announcing, earlier this year, its ambition to achieve net-zero emissions by 2050 and will see the business use funds raised from green instruments such as bonds, loans, and promissory notes to finance and/or refinance projects that aim to deliver a positive impact on the environment.
The Framework, believed to be the first of its kind to be delivered by a traditional energy company operating in Australia, was developed in collaboration with global investment banks HSBC and ING. Net proceeds of green instruments issued can be used to fund or refinance projects in four major categories: renewable energy, energy efficiency, clean transportation, and climate change adaptation.
Jemena is an $11.5 billion company that owns and manages some of Australia's most significant gas and electricity assets. These include:
- the Jemena Gas Network servicing 1.4 million customers around NSW;
- the Eastern Gas Pipeline which delivers gas from Victoria's Gippsland basin to the ACT, Sydney and regional NSW;
- the Queensland Gas Pipeline which supplies Gladstone and Rockhampton;
- the Darling Downs Pipeline System which transports gas to the Wallumbilla gas trading hub, the 630MW Darling Downs Power Station, and to the feeder pipeline to the APLNG LNG liquefaction plant at Gladstone;
- Jemena's Victorian electricity network which delivers electricity to over 360,000 homes and businesses in northern and western Melbourne
- the Northern Gas Pipeline from Tennant Creek in Northern Territory to Mount Isa in Queensland.
Jemena also part-owns the ActewAGL electricity and gas distribution networks in the ACT and United Energy, which supplies electricity to more than 600,000 customers across south-eastern Melbourne and the Mornington Peninsula. www.jemena.com.au
More information about Jemena’s Sustainability Program is available in its 2020 Sustainability Report: Adapting to Change, available on the Jemena website: https://jemena.com.au/about/investors/annual-reports.
The Framework is available at: https://jemena.com.au/about/investors/investor-information.