Tuesday 17 May 2022

Taqa, Ewec price first Abu Dhabi solar green bond at $700m

ABU DHABI, January 17, 2022

Abu Dhabi National Energy Company (Taqa) - one of the largest listed integrated utility companies in the EMEA region - along with Emirates Water and Electricity Company (Ewec) - a leader in the integrated coordination of planning, purchasing and supply of water and electricity across the UAE - announced today (January 17) the successful pricing of green senior secured bonds for an aggregate principal amount of $700.8 million by Sweihan PV Power Company (SPPC). 
The bonds, one of Taqa’s first forays into green financing, will refinance existing debt facilities of SPPC, the project company incorporated to build, own and operate Noor Abu Dhabi, the world’s largest single-site solar project currently in operation. 
Issued at a 3.625% coupon rate maturing  on January 31, 2049, the bonds are expected to receive BBB+/Baa1 ratings from S&P and Moody’s, respectively and were 1.8 times oversubscribed with local, regional and international investors placing total orders of $1.26 billion. 
This transaction generates significant value for the shareholders of SPPC and Ewec as procurer through an extension to the debt maturity by five years on the back of a five-year Power Purchase Agreement (PPA) extension to 2049, which was secured with the support of the Abu Dhabi Government.
Following presentation of its Green Bond Framework, SPPC’s bonds were certified under the International Capital Markets Association standards, ensuring that the project meets the requirements of the Green Bond Principles. 
Proceeds of the bonds will be used primarily to refinance loans arranged in 2017 for the construction, operation and maintenance of Noor Abu Dhabi. 
CEO and Managing Director Jasim Husain Thabet said: "Taqa continues to deliver benchmark renewable energy projects with our investments underpinned by our strong balance sheet and our commitment to delivering shareholder value."
"This bond attracted interest from international and ESG-focused investors, further solidifying the confidence in Taqa based on our strong track record. Over the next 10 years, we will continue to deliver on our objectives for sustainable growth and returns with a steadfast commitment to ESG to become the recognized low carbon power and water champion of Abu Dhabi," he added.
Ewec CEO Othman Al Ali said: "The green bond issuance for Noor Abu Dhabi is a ground-breaking initiative, demonstrating our commitment to applying innovative, sustainable energy and water production solutions."
"Noor Abu Dhabi is the foundation of solar power development in the emirate and the first of many world leading projects in the UAE that are driving change in the energy sector and minimizing its carbon footprint. Accessing investor markets through the issuance of green bonds is a key step in financing this critical change and supporting the UAE’s sustainability goals," stated Ali.
Noor Abu Dhabi is 60% owned by Taqa with the remaining 40% owned by Marubeni Corporation and JinkoSolar.
Sweihan PV Power Company CEO Abdulla Al Kayoumi said: "Noor Abu Dhabi has helped set the benchmark for the UAE’s ambitions to build a green economy. Issuing the first long-term green bond in Abu Dhabi to refinance the project speaks to our ability to deliver renewable energy competitively and reliably and is a testament to our commitment to the economic growth and sustainable development of Abu Dhabi."  
The bonds were arranged and offered through a syndicate of joint lead managers and bookrunners comprising Citi, HSBC, MUFG, BNP Paribas, First Abu Dhabi Bank (FAB) and SMBC Nikko. 
SPPC was advised by White & Case (legal) and Alderbrook Finance (financial). The joint lead managers and bookrunners were advised by Norton Rose Fulbright (legal).


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