The newly formed BRICS development bank is reportedly planning to float a bond issue aimed at raising funds for renewable energy projects in the member countries.
According to media reports, the New Development Bank could soon issue bonds worth $355 million to $384 million. The majority of the proceeds from the planned bond issue will be used to fund clean energy projects.
Officials of the bank had clearly stated that the first funding by the bank will be for a renewable energy project.
Demand for renewable energy funding in 4 of the 5 member countries may very well be among the highest in the world. Brazil, India, and South Africa are already running very successful renewable energy project auction programs; and China has the world’s most ambitious renewable energy targets. All these countries have seen a sharp spike in interest and investment from foreign project developers, which has led to increased competition driving the tariffs to historic lows.
Green bonds have recently emerged as among the primary choice for banks, financial institutions, and project developers to raise funds. Both China and India debuted at the global green bonds market last year with national entities raising around $1 billion each. Green bonds markets in both the countries are expected to balloon to a significant volume in a very short period of time.
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