CEFC congratulates SA Power Networks on green bond leadership

28 May 2024

The CEFC today congratulated SA Power Networks on the success of its landmark certified green bond, the first to be issued by an Australian electricity distributor. The CEFC participated in the $495 million issuance with a commitment of $28 million, reflecting its key support for the green bonds market, as well as Australia’s grid transformation.

CEFC Debt Markets Lead Richard Lovell said: “SA Power Networks has shown leadership in sustainability financing, bringing credible products to market to help finance our energy transformation. We congratulate the organisation on the quality of the issuance, which was significantly over subscribed.

“Our electricity system is undergoing a seismic transition, as carbon intensive and aging generators are replaced by lower cost, low emissions renewable energy and storage. This requires considerable investment, globally and in Australia. By securing certification under the Climate Bonds Standard ‘electrical and grids and storage’ criteria for this issuance, SA Power Networks is demonstrating how the electricity distribution sector can tap into the growing global pool of sustainable finance. As an experienced investor in green bonds, we are pleased to have supported SA Power Networks in bringing this new investment product to market.”

SA Power Networks will draw on the issuance to finance or refinance new or existing distribution assets that support South Australia’s transition to a distributed and decarbonised energy system.

Mr Lovell added: “South Australia is leading the energy transition, with global acknowledgement of its progress in renewable energy and large-scale storage. We congratulate SA Power Networks on the achievement of this exciting financing milestone to further underpin this rapid energy transformation.”

SA Power Networks media release

SA Power Networks becomes first Australian electricity distributor to issue certified green bond

27th May 2024

SA Power Networks has achieved another milestone in its sustainability journey, becoming the first Australian electricity distributor to issue a certified green bond.

SA Power Networks is the first corporate issuer of green bonds in the Australian market in 2024, with $245m of 3-year bonds and $250m of 8.5 year bonds, and a total order book of over $1.8 billion. It confirms the company’s leadership position in sustainable financing and the State’s world-leading position in the adoption of renewable energy, enabled by connection to SA Power Networks’ grid.

This follows the release of its Sustainable Financing Framework and receipt of pre-issuance certification under the Climate Bonds Standard's 'Electrical and Grids and Storage' criteria.

The Sustainable Financing Framework outlines the company's commitment to integrating sustainability principles into its financing activities. The Framework will serve as the guiding document for how SA Power Networks intends to borrow, issue, and manage sustainable (green) debt across its operations.

SA Power Networks Chief Financial Officer, Kevin Jones said: "As the sole electricity network that builds, maintains, and supplies power to over 1.7 million people living and working in South Australia, SA Power Networks is committed to supporting a renewable and more sustainable energy future.”

"Aligning our financial goals with our environmental and social responsibilities is paramount to ensure long-term value creation for our customers, stakeholders, and the South Australian community. We are delighted to lead the way in sustainable finance within the electricity distribution sector."

SA Power Networks will utilise proceeds from its financing instruments, including Green Bonds and Loans, to finance or refinance new or existing distribution assets that support South Australia’s transition to a distributed and decarbonised energy system. Additionally, funds will be allocated to adaptation and resilience projects, such as network bushfire readiness, to maintain and enhance grid resilience and reliability.

CEO of Climate Bonds Initiative, Sean Kidney, said: “SA Power Networks' issuance of its first Certified green bond marks a significant step in aligning financial strategies with environmental goals. This Certification under the Climate Bonds Standard highlights a commitment to robust science-based criteria and transparency in the utilities sector. The role of green bonds is essential in mobilising the necessary capital for sustainable infrastructure development. As the energy sector continues to evolve, such initiatives are crucial for supporting the transition to low-carbon economies. SA Power Networks' approach demonstrates integration of sustainability with best practice financial markets.”

ANZ acted as sole Sustainability Coordinator for the Sustainable Financing Framework.

ANZ Executive Director, Sustainable Finance, Bronwyn Corbet said: “ANZ is pleased to be supporting SA Power Networks in this milestone for the utility sector and helping develop this Sustainable Financing Framework which is aligned to ANZ’s commitment to support customers in their transition to net zero. We hope to see more of these initiatives in the energy sector as businesses look to implement sustainable finance frameworks and solutions to accelerate their sustainability strategies.”

Allison Purnell-Sullivan, Sustainability Manager at SA Power Networks, emphasised the importance of the company's commitment to sustainability and resilience.

"Like all electricity grids, we are already experiencing the physical impacts of our changing climate, so ensuring that we can continue to provide a safe, reliable, and resilient electricity supply is vital,” she said.

"Coupled with this, is our commitment to enabling customers to connect the sustainable energy resources they want, such as solar, batteries, and electric vehicles. South Australia is a world-leading example of what can be achieved, with over 70% of the electricity used in the state being provided by renewables."

SA Power Networks' Sustainable Finance Framework aligns with internationally recognised principles and standards, including the Green Bond Principles and the Climate Bonds Standard.

Achieving certification under the Climate Bonds Standard's Electrical Grids and Storage criteria further validates SA Power Networks' commitment to environmental stewardship and low-carbon energy infrastructure development. SA Power Networks invites stakeholders, investors, and the broader community to learn more about its Sustainable Financing Framework and commitment to sustainability by visiting our Sustainability page.