Portugal: Energy grids operator REN to issue €300 mln in first-ever ‘green’ bonds

Portugal’s energy grids operator, Redes Energéticas Nacionais (REN), is to go to the financial markets with its first-ever issue of ‘green’ bonds, in an amount of €300 million, with the debt to have a maturity of eight years and a fixed yield, it was announced on Friday. 

In a statement, the company – which operates the country’s high-voltage electricity and gas pipeline networks – said that “this green bond issue is part of REN’s regular financing policy, maintaining the profile of a solid, low-risk company, without changing its conservative financial policy aimed at consolidating an ‘Investment Grade’ credit profile.” 

The bond issue “reflects the alignment of the company’s financial strategy with the company’s sustainability strategy, based on the 17 Sustainable Development Goals (SDGs) created in 2015 by the United Nations, and demonstrates the company’s commitment to environmental, social and governance issues,” the statement adds. 

The group of banks charged with placing the bonds with investors comprises Spain’s BBVA and Santander; Portugal’s Millennium BCP and CaixaBI – the latter being the investment banking unit of state savings bank Caixa Geral de Depósitos; ING of the Netherlands; JP Morgan of the US; and SMBC (Sumitomo Mitsui) of Japan. All are acting as joint bookrunners, according to REN, which added that ING also had the role of structuring advisor in the process of drafting its sustainable finance framework, published in February. 

The issue comes two months after REN was issued by Institutional Shareholder Services (ISS-ESG) with a ‘Prime’ rating, on the basis that the company makes a “significant contribution” to achieving “sustainable development goals”.

REN’s debt is rated BBB by credit rating agency Fitch and and by Standard & Poor’s, and Baa3 by Moody’s.

In 2020, the company had a net profit of €109.2 million, down 8.1% from 2019.