Climate Change

GEK Terna to raise EUR 300 million via green bonds with obligation to cut emissions

GEK Terna raise EUR 300 million via green bonds obligation cut emissions

Photo: GEK Terna


December 6, 2021






December 6, 2021





Greek construction and energy giant GEK Terna is preparing to sell common sustainability-linked bonds with a target of EUR 300 million. The investors will get paid more if the company fails to reduce greenhouse gas emissions by 25% through 2025.

The GEK Terna Group has a plan to boost the capacity of wind farms, photovoltaic plants and electricity storage systems to 3 GW by 2028. Through its member company Terna Energy, as of June 30 it had a portfolio of over 1.3 GW in operation, under construction or ready for construction in Greece, Central and Eastern Europe.

The construction giant, which is also active in the areas of real estate and waste management, announced it would offer common sustainability-linked bonds to be traded at the Athens Exchange. The goal is to raise EUR 300 million, but the issue will be canceled if the demand is lower than EUR 200 million.

Emission cut target is 25% by end-2025

The seven-year green bond sale, which should be completed by December 10, comes with a clause that GEK Terna must lower greenhouse gas emissions by 25% through the end of 2025. It said that if it fails, investors would get an increase in the interest rate of 0.2 percentage points.

The company expressed confidence that its energy projects would contribute to the plan to reduce the environmental and energy footprint.

EnergyPress learned the funds would be used to partially finance an 877 MW gas-fired power plant project in Komotini, which GEK Terna is developing with Motor Oil. The facility is valued at EUR 375 million and it is scheduled to come online in three years.

Energy companies in Greece adding green bonds to portfolios

Terna Energy sold green bonds for EUR 150 million in 2019 to fund its renewable energy projects. National electricity producer Public Power Corp. (PPC or DEI) raised EUR 775 million in sustainability-linked debt securities in March, followed by a EUR 500 million issue in July. It said it would cut greenhouse gas emissions by 40% by the end of 2022 or that it would pay creditors back 0.5 percentage points more in interest.

The National Bank of Greece or NBG issued green bonds of EUR 500 million in total a year ago with the obligation to invest in hydropower, wind parks and photovoltaic projects.

Mytilineos raised EUR 500 million in April in its first green bond issue.

Green or climate bond arrangements are an emerging segment in the global debt market. Companies, governments and financial institutions are turning to the tool to provide funds in line with new, stricter environmental standards. Such projects mitigate climate change and its impact and introduce the principles of circular economy.

Comments (0)

Be the first one to comment on this article.

Enter Your Comment
Please wait... Please fill in the required fields. There seems to be an error, please refresh the page and try again. Your comment has been sent.

Related Articles

EU power gas prices smashing records drought EdF nuclear setback

EU power, gas prices smashing records amid drought, EdF’s nuclear plant setback

03 August 2022 - Low water levels in major rivers disturb the operation of nuclear power plants and the transportation of coal

m+ group green bonds croatia

First green bonds issued in Croatia

02 August 2022 - The strategic partners in the green bond issue are Erste&Steiermärkische Bank and the European Bank for Reconstruction and Development

Drought cost Montenegro EPCG utility EUR 100 million third quarter

Drought to cost Montenegro’s EPCG utility EUR 100 million in third quarter

01 August 2022 - State-owned power producer EPCG said it would have to import 294 GWh of electricity in the three months through September due to drought

steel green hydrogen decarbonization

Decarbonizing one steel plant with hydrogen requires up to EUR 7 billion in investment

29 July 2022 - Hydrogen Europe conducted an analysis of the viability of using solar and renewable energy to decarbonize steel manufacturing