France’s state-owned railway company has become the first in Europe to invest green bond proceeds in a railway network expansion project.
According to media reports, SNCF Network will undertaken investment in modernisation of its railway infrastructure using proceeds from a recent €900 million green bond issue.
The company has developed a methodology for calculation of emission offsets achieved through the network modernisation. The use of proceeds from green bonds shall be reviewed by an external auditor.
The green bonds issued by SNCF have been awarded Green Bond Principles certification from the Oekom Research and Climate Bond Initiative.
The bond issue, which should yield its investors an interest rate of 1.104% and has a 15 year maturity period, was absorbed by existing investors of SNCF.
Following the success of this green bond issue, the company is looking to make €1.5–1.8 billion green bond–eligible investments every year and thus plans to issue at least one new green bond every year.
Image via SNCF Network