2014 06 02 Green Bonds Market Outlook 2014

GREEN BONDS
MARKET OUTLOOK
2014
Blooming with new varietals
2 June 2014
GREEN BONDS MARKET OUTLOOK 2014
2 JUNE 2014
CONTENTS
SECTION 1. EXECUTIVE SUMMARY ____________________________ 4
SECTION 2. INTRODUCTION __________________________________ 6
2.1. MARKET SIZE .................................................................................................. 6
2.2. DEVELOPMENTS ............................................................................................. 7
SECTION 3. CORPORATE SELF-LABELLED BONDS _______________ 9

3.1. OVERVIEW ....................................................................................................... 9
3.2. LEAD UNDERWRITERS ................................................................................. 11
3.3. INVESTORS ................................................................................................... 11
SECTION 4. GREEN ASSET-BACKED SECURITIES_______________ 12

4.1. OVERVIEW ..................................................................................................... 12
4.2. SOLARCITY 2013 ABS IN DEPTH ................................................................. 12
4.3. UNDERWRITERS & INVESTORS .................................................................. 15
SECTION 5. PROJECT BONDS _______________________________ 16

5.1. OVERVIEW ..................................................................................................... 16
5.2. KEY PROJECT BONDS.................................................................................. 16
5.4. INVESTORS ................................................................................................... 18
SECTION 6. SUPRANATIONAL/INTERNATIONAL BONDS __________ 19

6.1. OVERVIEW ..................................................................................................... 19
6.3. INVESTORS ................................................................................................... 21
SECTION 7. GOVERNMENT & MUNICIPAL BONDS _______________ 22
ABOUT US _______________________________________________________ 24
TABLE OF FIGURES
Figure 1: Historical green bond issuance, by type ($bn) ................................................... 6
Figure 2: Green bond issuance versus US corporate debt ($bn) ...................................... 7
Figure 3: Corporate self-labelled green bond issuance, last 12 months (coupon, tenor) ... 9
Figure 4: Top 10 corporate self-labelled green bond underwriters, 2013-present ($,
deals) .............................................................................................................. 11
Figure 5: SolarCity 2013 ABS by host type .................................................................... 13
Figure 6: SolarCity 2013 ABS contract types.................................................................. 13
Figure 7: SolarCity 2013 ABS module manufacturers .................................................... 13
Figure 8: SolarCity 2013 ABS inverter manufacturers .................................................... 13
Figure 9: SolarCity ABS yields versus US auto-loan ABS tranches (coupon, tenor in
years) .............................................................................................................. 14
Figure 10: Project bond issuance since 2011 ($bn) ......................................................... 16
Figure 11: Project bond issuance 2011-present (coupon, year, size $m) ........................... 17
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2 JUNE 2014
Figure 12: Top project bond underwriters, 2013 ($m, deals) .............................................. 18
Figure 13: Supranational/international green bond issuance by bank ($bn) ....................... 19
Figure 14: Disclosed use of proceeds by bank ($bn) ......................................................... 20
Figure 15: Top supranational/international green bond underwriters, 2013 ($m, deals) ..... 20
Figure 16: Top disclosed buyers of World Bank IBRD bonds, 2013-present ...................... 21
Figure 17: Government & municipal issuance over time ($m) ............................................ 22
Figure 18: CREB & QECB issuance by use of proceeds ($m) ........................................... 23
TABLE OF TABLES
Table 1: Our definition of the green bond universe .......................................................... 7
Table 2: Example verifiers used for corporate green bonds .......................................... 10
Table 3: Self-labelled corporate bond issuers ............................................................... 10
Table 4: Top reported holders of self-labelled corporate bonds, all time........................ 11
Table 5: Green ABS deals to date................................................................................. 12
Table 6: SolarCity 2013 ABS system locations ............................................................. 13
Table 7: SolarCity securitisation characteristics versus other ABS types, US market .... 14
Table 8: Underwriters of green ABSs ............................................................................ 15
Table 9: Toyota ABS holdings ....................................................................................... 15
Table 10: SolarCity 2013 ABS holdings .......................................................................... 15
Table 11: Clean energy project finance and bond finance versus other infrastructure ..... 16
Table 12: Key project bond issuances since January 2013 ............................................. 17
Table 13: Top reported holders of clean energy project bonds, all time........................... 18
Table 14: QECB and CREB issuance versus allocation .................................................. 22
Table 15: International government green bond issuance since 2013 ............................. 23
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2 JUNE 2014
SECTION 1. EXECUTIVE SUMMARY

A record $16.6bn of green bonds have been issued to-date in 2014, driven by a
surge in corporate self-labelled issuance and sustained volumes from large
international and supranational banks. At its current pace, total 2014 volume
could surpass $40bn, triple the $14bn issued in 2013. Innovative asset-backed
securities and new entrants to the corporate space provide a solid foundation for
an aggressive near-term growth trajectory.
• Thus far, through 2 June 2014, a record $16.6bn in green bonds have been issued in 2014,
driven by a surge in corporate self-labelled bonds and high volumes from large international
and supranational institutions likes the World Bank.
• The market is growing fast: at its current pace, total volume in 2014 will surpass $40bn by the
end of the year, triple 2013’s volume. However, it still constitutes only a small fraction of the
broader bond market. Global green bond issuance in 2013 was about 1% of the value of the
US corporate bond issuance, which was over $1.4 trillion.
• The entrance of self-labelled green corporate bonds – bonds issued by corporations with
proceeds ring-fenced for green investments – has opened up a new source of capital for the
market as has the emergence of innovative asset-backed securities like the distributed solar-
backed bonds pioneered by SolarCity in late 2013.
Corporate self-labelled
• Self-labelled green corporates function in much the same way as international and
supranational bonds: their proceeds are used to fund green activities, but their repayments are
from general corporate funds. Issuers have not been able to realise pricing advantages through
green labelling as investors are unwilling to take lower than expected coupons simply for the
ability to ‘go green’.
• Bank of America Merrill Lynch has been both an issuer and an underwriter of these types of
bonds. In terms of issuance, it kicked-off the corporate self-labelled space in early November
2013 with a $500m green bond, the proceeds of which are to be used to finance renewables
and energy efficiency via loans and credit lines to industry participants. Since then, about
$9.7bn in corporate self-labelled green bonds have been issued by nine companies in Europe
and the United States.
• In terms of underwriting, Bank of America Merrill Lynch is the top self-labelled underwriter with
just over $1bn in underwriting since mid-2013, having participated in their own $500m offering
as well as in deals with GDF Suez, Unibail-Rodamco and Iberdrola. Swedish bank SEB comes
second.
Asset-backed securities
• The green ABS market kicked off in 2013 with Hannon Armstrong Sustainable Infrastructure’s
issuance of a $100m ABS backed by the cashflows of over 100 wind, solar and energy
efficiency projects at 20 properties across the US. Total issued since that date – across five
different deals from four issuers – is $2.08bn.
• SolarCity’s inaugural solar-backed ABS in November 2013 marked the start of what will likely
be a significant market for solar securitiation in the US. Although small at $54.4m, it was a first
step in testing the waters of both the demand for these securities and the process of issuing
them. The company issued a second ABS ($70.2m) in March 2014. This report contains a
special section on SolarCity's pioneering 2013 deal; key characteristics of that ABS include:
© Bloomberg Finance L.P.2014 Disclaimer notice on page 25 applies throughout. Page 1 of 22
2 JUNE 2014
 Over-collateralisation, a risk enhancement for investors, was 61%, a huge figure versus
other niche ABS types (where 10% is typically high)
 Residential systems made up 90% of the ABS by value and 71% by number of systems
 The delinquency rate of payments 120 days or more past due is 0.31%
 FICO scores were in the range of 680-886 with an average of 762
 The securities are priced at around a 300 basis point (3.0%) premium auto loan ABSs of
comparable maturity, a premium which will likely compress with issuance repetition.
 Yingli manufactured 44% of the modules underlying the deal while Fronius made 48% of the
inverters
• Toyota’s bond takes the form of a standard auto-loan backed ABS whose cashflows are tied to
repayments of outstanding loans for the company’s cars. What actually makes it greens is that
the company has ring-fenced the proceeds for a fund that will provide leases and loans for the
company’s green vehicles such as the Prius.
• The Western Riverside Council of Governments – a municipal agency in California – worked
with Deutsche Bank to issue a first-of-a-kind securitised property assessed clean energy
(PACE) bond. The PACE programme allows governments to provide property owners upfront
capital for energy efficiency improvements, which are in-turn repaid through additional charges
on homeowner property taxes.
Project bonds
• Over $3.1bn of clean energy project bonds were issued in 2013, a 53% increase from 2012.
Nearly a third of the total volume was attributable to a single project, a $1bn issue backed by
the 580MW Solar Star PV project, owned by US-based Berkshire Hathaway Energy.
• In the last 12 months, two large wind portfolio bonds have been issued: one from US-based
Exelon backed by 13 wind farms and one from Swedish developer Arise with 10 wind farms.
As the pipelines of European and US-based large-scale onshore wind and PV projects slow
down, these types of issues backed by multiple smaller projects could prove to be a growing
source of renewables project bond volume.
Supranational/international bonds
• Supranational and international banks issued a record $7.1bn of bonds in 2013, a 70% increase
from the previous best in 2010. With $6.1bn issued year-to-date they are on record to beat that
volume within the next few months.
• Average supranational issuance size jumped 370% in 2013 to $375m from $86m in 2012 as
banks began to bring benchmark-size bonds to the market: the World Bank has issued two
$1bn bonds since Q1 2013. Structures have evolved as well: in March 2014, the European
Investment Bank issued its first green 'Samurai' bond (yen-denominated bonds issued in Tokyo
by foreign companies) and the World Bank launched its first green 'Kangaroo' bond (Australian
dollar-denominated bonds issued in Australia by foreign companies).
National/municipal bonds
• Government entities issued $910m in green bonds in 2013 as a number of new programmes
and issuers came to market, accounting for $677m of total volume. Previously existing US
municipal bond schemes made up the remainder. $1.3bn has been issued so far in 2014,
mostly by international governmental agencies.
• Two regional German banks plus the City of Gothenburg Sweden entered the market in 2013.
Ile de France – the governing authority of Paris and its environs – issued its second bond in
April 2014 (the first had come in March 2012): an $829m issue with proceeds earmarked for a
broad array of projects including typical renewable energy and energy efficiency developments
plus innovative initiatives like ecological corridor development. Gothenburg announced an
additional $270m worth of bonds on 26 May 2014.
2 JUNE 2014
SECTION 2. INTRODUCTION
This is our second annual Green Bonds Market Outlook, following up on the 20 March 2013 Note
Green Bonds Market Outlook 2013: ripe pickings. The market standard definition for what
constitutes a green bond continues to evolve, but consensus is forming around key attributes and
the momentum of corporate green bond issuance is bringing significant attention to the space. In
this Market Outlook we wrap up 2013 and discuss the key events of 2014 thus far. We continue
with the same focus as in our previous Note: looking at bonds that are issued under more or less
explicitly green premises rather than focusing on the much broader market of debt issued by
companies active in green or sustainable business segments.
2.1. MARKET SIZE

Thus far, as of end of 2 June 2014, a record $16.6bn in green bonds have been issued this year, a
volume driven by a surge in corporate self-labelled bonds and sustained issuance from large
international and supranational banks. At its current pace, total volume will surpass $40bn by the
end of the year, triple the volume issued in 2013 (Figure 1). Whether or not this happens will largely
depend on the march of new entrants into the corporate-self labelled green bond market. Sustained
growth in coming years will likely rely on a combination of corporate issuance growth coupled with
the emergence of the solar and energy efficiency asset-backed security (ABS) market in the US.
Figure 1: Historical green bond issuance, by type ($bn)

50
45 Extrapolated
40
35 Project bonds
30
Government
25
20 ABS
15
10 Corporate self-
labelled
5
Supranational
0
2007 2008 2009 2010 2011 2012 2013 2014
Source: Bloomberg New Energy Finance Note: 'Extrapolated' assumes continuation of current pace.
Nearly $14bn in green bonds were issued in 2013, double the market’s previous top year in 2010.
Year-over-year, from 2012 to 2013, it was the international and supranational banks that saw the
most growth, issuing over $7bn in bonds; a jump of 330% from the $1.6bn issued in 2012. The
entrance of two new types of green bonds in 2013 – ABS and corporate self-labelled – brought
nearly $3bn in additional capital to the space (further details below).
While the market is certainly growing it remains a relatively small component of the total fixed
income universe. The record $14bn in green bonds issued in 2013 stands in stark contrast to
$1,400bn worth of corporate debt issued in the US alone that same year. On the issuer level the
green bond market in 2013 was roughly equal to what Petroleo Brasileiro alone issued through the
year. However, the green bond space is gaining prominence, and if current trends are extrapolated
for the full year 2014, the global green bond market will be roughly 3.2% of value the US corporate
bond market, up from 1% in 2013 and 0.4% in 2012 (Figure 2).
2 JUNE 2014
Figure 2: Green bond issuance versus US corporate debt ($bn)

1,600
Extrapolated
1,400 corporate
bond
1,200
US corporate
1,000 bond
800
Extrapolated
600 green bond
400
Green bond
200
0
2010 2011 2012 2013 2014
Source: Bloomberg New Energy Finance, Securities Industry and Financial Markets Association (SIFMA)
2.2. DEVELOPMENTS
The entrance of ABS and corporate self-labelled marked a significant milestone in this evolving
market. Two first-of-a-kind ABS products where issued, first by Hannon Armstrong Sustainable
Infrastructure which issued a $100m security backed by cashflows from over 100 wind, solar and
energy efficiency installations, and then from SolarCity with a $54.4m solar-backed ABS. In
November, Bank of America Merrill Lynch inaugurated the self-labelled corporate green bond
category with a $500m issue, followed closely by Swedish property company Vasakronan and
French utility and project developer EDF.
For this year’s Outlook we add corporate self-labelled green bonds and green ABSs to our bond
universe (Table 1). For purposes of this Research Note we maintain a narrow view of the green
bond market, choosing to exclude the universe of less-explicitly labelled green debt which includes
bonds issued by companies active in the green economy or bonds issued to fund green activities
but not explicitly labelled as such.
Table 1: Our definition of the green bond universe

Type Definition
Corporate self- Bonds issued by corporations and explicitly labelled as green
labelled (new)
Green ABS (new) Asset-backed securities whose cashflows come from a portfolio of underlying
receivables such as loans, leases and PPAs. The receivables are associated with
green (eg, renewable energy, energy efficiency) projects.
Supranational/ Bonds issued by supranational or international organisations like multilateral
international banks, development banks and export credit agencies
Government Bonds issued by national, regional or local governments to finance green projects.
This includes US municipal bonds.
Project bonds Bonds backed by the cashflows of an underlying renewable energy project or
portfolio of projects
Source: Bloomberg New Energy Finance
The ongoing definition debate

The great quest for the universally accepted green bond definition picked up steam this year with
the introduction of the Green Bond Principles (see our 16 January 2014 Research Note, The green
bond market takes off in 2013 for additional details). Initially drafted by JP Morgan, Bank of America
Merrill Lynch, Citi and Credit Agricole, the group that supports these principles now numbers 25
2 JUNE 2014
and includes all of the top 10 global corporate bond underwriters of 2013. Centralised by the
International Capital Market Association, the Principles aim to establish voluntary guidelines for
transparency and disclosure to ensure market integrity. The group established its governance
framework in April and is taking aim mostly at the emerging corporate self-labelled green space
where little guidance exists as to what types of activities constitute green, and what types of
reporting and verification should be required.
The Principles are composed of four components: proceeds guidelines; project evaluation and
selection processes; proceeds management processes; and reporting guidelines. The main use of
proceeds categories include:
• Renewable energy
• Energy efficiency (including efficient buildings)
• Sustainable waste management
• Sustainable land use (including sustainable forestry and agriculture)
• Biodiversity conservation
• Clean transportation
• Clean water and/or drinking water
2 JUNE 2014
SECTION 3. CORPORATE SELF-LABELLED BONDS

3.1. OVERVIEW
Bank of America kicked-off the corporate self-labelled space in early November 2013 with a $500m
green bond, the proceeds of which are to be used to finance renewable and energy efficiency
projects via loans and credit lines to industry participants, helping the bank hit its 10-year $50bn
environmental business initiative target. Since then, just over $9.7bn in corporate self-labelled
green bonds have been issued by 12 issuers in Europe and the United States, including a record
$3.4bn placed through two simultaneous issues by French utility GDF Suez.
Self-labelled green corporates function in much the same way as international and supranational
bonds: their proceeds are used to fund green activities, but their repayments are from general
corporate funds and as a result benefit from receiving the same credit rating as other bonds of
similar composition from the same issuer. Figure 3 shows all issued bonds in a yield curve format,
plotted by coupon and tenor. The chart also includes two lines that serve as benchmarks; they
illustrate the yield curve trends for investment-grade corporates in both Europe and the US of
comparable coupon and tenor.
Issuers have not been able to realise pricing advantages through green labelling as investors are
unwilling to take lower than expected coupons simply for the ability to ‘go green’. The most
commonly-cited reason for green-labelling is diversification of the issuer’s investor pool: green
bonds have enabled these issuers to attract new companies to their investor pool by offering a
product that satisfies investor desire for sustainable fixed income investments.
Figure 3: Corporate self-labelled green bond issuance, last 12 months (coupon, tenor)
Coupon (%)
4.0 US investment grade
corporate bond
trendline
3.5
3.0
2.5
2.0
1.5
European investment
1.0 grade corporate bond
trendline
0.5
0.0
0 2 4 6 8 10 12
Verifier: Auditor Vigeo Cicero DNV $100m Tenor (yrs)
Source: Bloomberg New Energy Finance Note: ‘Verifier’’; indicates the presence of an external party who will
review the use of proceeds and reporting to ensure compliance with green credentials. In the case of auditor
the companies use an accounting firm, typically their auditor, to ensure compliance. See Table 2 for more info.
The single criteria that defines a corporate self-labelled green bond – for the purposes of this report
– is straightforward: the issuer explicitly labels the bond as green. There are no legally binding
guidelines to help investors determine the legitimacy of issuers’ claims, but the Green Bond
Principles are seeking to provide clarity for that. Investor scrutiny serves as an initial check on green
legitimacy, and issuers have mostly been quick to provide background information to substantiate
that the proceeds will be put to green uses. Issuers tend to use verification from outside entities or
2 JUNE 2014
auditor attestation letters (Table 2) as an initial way of reassuring investors, backing that up with
explicit definitions for use of proceeds and with an outline of how they will report the use of the
raised funds and the performance of those investments.
Table 2: Example verifiers used for corporate green bonds
Verifier Location Background

Centre for International Sweden Not-for-profit environmental research institute, mandated by
Climate and Environmental SEB to provide secondary opinions on green bonds
Research at the University underwritten by the bank
of Oslo (CICERO)
Vigeo France Private business that assesses companies based on their
environmental, social and governance (ESG) performance;
sets guidelines for the types of projects that can be used
with green bond proceeds
DNV GL Norway Certification organisation, helps develop green bond
frameworks with issuers or ensures compliance with
predefined guidelines such as the Green Bonds Principles
Source: Bloomberg New Energy Finance, company websites
The use of proceeds for self-labelled corporates varies widely and typically depends on the
business model of the issuer (Table 3). Unibail-Rodamco, Vasakronan and Regency Centers are
commercial and retail property companies; consequently the proceeds of their bonds will be used
primarily to increase the energy efficiency of their building portfolios. Skanska – a major
construction firm – will use its proceeds to fund green property developments in their property
investment portfolio. GDF Suez, Iberdrola and EDF are utilities active in renewable energy
development and intend to use their bond proceeds to invest in renewable and energy efficiency
projects both directly and through dedicated subsidiaries. Svenska Cellulosa and Unilever are
manufacturing companies seeking to fund energy efficiency improvements and waste and water
use reductions in their facilities, and generally invest in more sustainable business practices. The
most vague proceed uses come from the financials: TD Bank and Bank of America Merrill Lynch,
where proceeds will be used to fund investments and banking activities in the renewable energy
and energy efficiency space.
Table 3: Self-labelled corporate bond issuers
Country of $m
Company Sector domicile issued Issues Reviewer Use of proceeds
GDF Suez Utilities France 3,427 2 Vigeo Energy efficiency & renewable energy
EDF Utilities France 1,901 1 Vigeo Renewable energy (via EDF Energies Nouvelles)
Iberdrola Utilities Spain 1,037 1 Vigeo Renewable energy, transmission and smart grid
International projects (via Iberdrola Renovables)
Unibail-Rodamco Real estate France 1,027 1 Vigeo Energy efficiency & green buildings
Bank of America Financial US 500 1 PWC Energy efficiency & renewable energy
TD Bank Financial Canada 453 1 TBD* Renewable energy, energy efficiency, green
infrastructure, sustainable agriculture & forestry
Unilever Consumer, UK 415 1 DNV GL GHG, waste and water reduction
Non-cyclical
Vasakronan Real estate Sweden 354 4 Cicero Energy efficiency & green buildings
Regency Centers Real estate US 250 1 TBD* Energy efficiency & green buildings
Svenska Cellulosa Basic Sweden 232 2 Cicero Renewable energy, energy efficiency, fuel
Materials switching to biofuels, waste & water, sustainable
forestry
Skanska Financial Industrial Sweden 131 1 Cicero Energy efficiency & green buildings
Services
Rikshem Real estate Sweden 15 1 Cicero Energy efficiency & green buildings
Source: Bloomberg New Energy Finance, company filings. Note: TD Bank & Regency will use a third party accounting opinion for reporting
verification but have yet to disclose specifics.
2 JUNE 2014
3.2. LEAD UNDERWRITERS

Although the corporate self-labelled market has existed for less than 12 months, it already has
some clear leading underwriters (Figure 4). Bank of America Merrill Lynch is on top with just over
$1bn in deal value, having participated in their parent company’s $500m offering as well as in the
GDF Suez, Unibail-Rodamco and Iberdrola deals (Bank of America Merrill Lynch is the investment
banking arm of Bank of America). Swedish bank SEB comes second (SEB is first overall in the
international/supranational underwriting category) as the sole lead underwriter in seven deals:
Vasakronan’s four bonds, Svenska Cellulosa’s two offerings and Skanska Financial Services’ bond.
Figure 4: Top 10 corporate self-labelled green bond underwriters, 2013-present ($, deals)
Number of deals
0 1 2 3 4 5 6 7 8 9
Bank of America ML
SEB
JPMorgan
Credit Agricole
Commerzbank
Societe Generale
Santander
TD Securities
Morgan Stanley
Citi
0 200 400 600 800 1,000 1,200

Value Deals Investment ($m)
Source: Bloomberg New Energy Finance. Note: Joint-lead underwriters are allocated equal portions of each
issue, data for some deals is unconfirmed by underwriters due to nature of private placement deals.
3.3. INVESTORS
Disclosed data on holders of self-labelled corporates is scarce, and accounts for a meagre $579m
of the $6bn issued to-date. But a look at indicative data that has been disclosed by the banks
indicates a broad range of investors that is far from limited to purely environmentally-mandated
funds (Table 4). Bank of America Merrill Lynch is the only issuer to date to release a summary of
investors in their issue, which includes a number of the investors below but also larger asset
managers like State Street Global Advisors, TIAA-CREF, CalSTRS and Swedish pension fund AP4.
Table 4: Top reported holders of self-labelled corporate bonds, all time

Investor Country Activities $m
Nordea Bank Sweden Banking & asset management 115
BlackRock US Asset management 53
Parvest Investment Management (BNP) France Asset management 27
Mawer Investment Management Canada Asset management 23
Amundi France Asset management 21
AGICAM France Asset management 20
Svenska Handelsbanke Sweden Banking & asset management 19
Vanguard Group US Asset management 18
Allstate US Insurance 17
Natixis France Banking & asset management 16
Source: Bloomberg New Energy Finance, Bloomberg Terminal. Note: data from reported holdings and
represents only a small portion of total issued value.
2 JUNE 2014
SECTION 4. GREEN ASSET-BACKED SECURITIES

4.1. OVERVIEW
The green ABS market kicked off in 2013. Total issued since that date – across five different deals
from four issuers – is $2.08bn. Each of the ABS issuers took distinctly different paths to a green
ABS:
• Hannon Armstrong Sustainable Infrastructure is the first REIT to be backed by renewables and
energy efficient infrastructure; its $100m ABS is backed by cashflows from a diverse array of
over 100 wind, solar, and energy efficiency projects across the US.
• Toyota, the Japanese automaker, issued a $1,75bn bond in March 2014. This bond takes the
form of a standard auto-loan backed ABS whose cashflows are tied to repayments of
outstanding loans for the company’s cars. What actually makes it greens is that the company
has ring-fenced the proceeds for a fund that will provide leases and loans for the company’s
green vehicles such as the Prius. (For more on this, see our 19 March 2014 Analyst Reaction,
Toyota puts auto loans in the green with a new ABS.)
• SolarCity’s inaugural solar-backed ABS in November of 2013 generated significant buzz as it
marked the start of what will likely be a significant market for solar securitisation in the US.
Although small at $54.4m, it was a first step in testing the waters of both the demand for these
securities and the process of issuing them. (See Section 4.1 for more discussion).
• The Western Riverside Council of Governments – a municipal agency in California – worked
with Deutsche Bank to issue a first-of-a-kind securitised property assessed clean energy
(PACE) bond in March 2014. The PACE programme allows governments to provide property
owners upfront capital for energy efficiency improvements in return for repayment over time.
The repayments are done through liens secured by underlying property and are paid through
an additional charge on homeowner property tax bills.
Table 5: Green ABS deals to date

Issuer Date Value ($m) Sector Maturity date Coupon Underlying assets
SolarCity - 2013 21 Nov 13 54 Solar - PV 20 Nov 2038 4.80% 43.9MW of PV across 5,033 projects
in the US, 71% residential
Hannon Armstrong 23 Dec 13 100 Renewables & 23 Dec 2019 2.79% About 100 wind, solar and energy
Sustainable energy efficiency projects at 20 US properties
Infrastructure efficiency
Western Riverside 14 Mar 14 104 Energy 20 Sep 2038 4.75% Property tax payments from property
Council of efficiency owners which have implemented
Governments PACE energy efficiency improvements
Toyota 19 Mar 14 1,750 Transportation 2015 – 2020 0.19% Auto loan repayments from buyers of
Toyota’s vehicles
SolarCity - 2014 10 Apr 14 70 Solar - PV 10 Apr 2044 4.59% 6,596 projects in the US, 87%
residential
Source: Bloomberg New Energy Finance, company filings
4.2. SOLARCITY 2013 ABS IN DEPTH

SolarCity’s inaugural $54.4m solar ABS was backed by 43.9MW of PV in the US, spread across
5,033 systems worth a total of $87.8m. The difference between the amount issued and the total
value was held by SolarCity as an over-collateralisation – a risk enhancement for the investors as
this part of the portfolio would be the first to absorb losses in the instance of cashflow problems.
This amounted to a 61% over-collateralisation, a huge figure versus other niche ABS types which
– if over-collateralised at all – top out at around 10%. Residential systems made up 90% of the ABS
2 JUNE 2014
by value and about 71% by number of systems (Figure 5). (This number was bumped up for their
most recent 2014 bond, where the residential composition was 87%.)
The typical residential project was associated with a FICO score of 762 with a range from 680 to
886, which puts their average within the top 40% of credit scores in the US. SolarCity’s delinquency
rates for the first half of 2013 indicated that about 0.31% of payments were 120 days or more past
due, with 0.73% between 30 to 120 days overdue.
One of the larger concerns voiced by solar ABS investors is what happens in the event that a
Table 6: SolarCity 2013
homeowner sells their house and is forced to transfer their contract. This type of event is referred
ABS system locations
to as a reassignment. In the case of SolarCity's 2013 ABS portfolio, about 952 systems have been
State % of reassigned to date, and this has resulted in a 97% recovery rate, which means that 3% of the time
systems
these events cause financial loss.
California 47.09
Arizona 28.25 Operationally 57% of the systems were put in service after 2012 and nearly 50% were located in
Colorado 11.19 California (Table 6). Contractually lease contracts dominate, but about 25% of the contracts are
Hawaii 2.09 PPA-based (Figure 6).
Other 11.38
Figure 5: SolarCity 2013 ABS by host type Figure 6: SolarCity 2013 ABS contract types
Source: SolarCity
Residential Commercial Lease PPA

Source: SolarCity filings, Bloomberg new Energy Finance
Within the 2013 ABS portfolio SolarCity relies heavily on two inverter manufacturers – Fronius and
Power-One – for their system inverters. The module base is diversified a bit more, but the bulk were
produced by Yingli and most are coming from Chinese manufacturers.
Figure 7: SolarCity 2013 ABS module Figure 8: SolarCity 2013 ABS inverter
manufacturers manufacturers
Other Other
4% 8%
FirstSolar SMA
13% 15%
Yingli
Kyocera 44% Fronius
15% 48%
Power-
Evergreen One
17% Trina 29%
Solar
7%
Source: SolarCity filings, Bloomberg New Energy Finance
2 JUNE 2014
ABS pricing and structure

The fact that the securitised solar market is in its early age means that a number of its attributes
are significantly out of line with other more mature ABS segments. For comparison, it makes sense
to benchmark solar ABSs versus other small ABS markets like auto and credit card securities. In
terms of characteristics, solar ABSs likely draw the most sensible comparison with equipment-lease
ABSs. Issuance size is one area where convergence to more typical ABS characteristics is key;
average ABS issuance sizes are $300-800m while SolarCity comes in around $65m. Demand for
sub-$100m issues is low and secondary markets are illiquid. Operational history is also an obstacle:
investors like to see historical performance data at least equal to the tenor of their investments, but
the young age of the market means that SolarCity cannot provide 28 years of data on its systems.
Table 7: SolarCity securitisation characteristics versus other ABS types, US market
Average
annual Average Average
market issuance tenor Inaugural
Type Description value ($bn) size ($m) (yrs) issue
Solar Residential, commercial and N/A 65 10.6* 2013
industrial solar leases & PPAs
Equipment Equipment; re-securitisations of 9 410 7.1 1985
equipment securities
Auto Auto, RV, motorcycle loan & 76 560 5.2 pre-1985
leases, dealer floorplans,
Credit Card payments 50 768 6.6 1987
cards
Student Public & private student loan 37 484 21.4 1993
loans
Other Tax liens, trade receivables, boat 26 309 26.8 1986
loans, aircraft
Source: Bloomberg New Energy Finance, SIFMA. Note: SolarCity tenor is for expected maturity.
In Figure 9, SolarCity’s first two ABSs are compared with a sample of US auto loan tranches from
2013 to demonstrate pricing premiums in these early issues. A typical ABS has tranches labelled
A to E, with each incremental tranche containing riskier assets. The lowest risk tranche in any ABS
is the A tranche, which is subsequently priced with the lowest coupon all the way up to the E tranche
(if there is one), which is typically held by the issuer as a sort of first loss enhancement. SolarCity’s
securities are priced at around a 300 basis point (3.0%) premium to A-tranche auto loans of
comparable maturity, a premium which will likely compress with issuance repetition.
Figure 9: SolarCity ABS yields versus US auto-loan ABS tranches (coupon, tenor in years)
5.0
4.5 A
4.0 A1
3.5 A2
3.0 A3
2.5 A4
2.0 B
1.5
C
1.0
D
0.5
Solarcity
0.0
0 3 6 9 12
2 JUNE 2014
Source: Bloomberg, Bloomberg New Energy Finance. Note: curve calculated using expected rather than final
maturity.
4.3. UNDERWRITERS & INVESTORS

Credit Suisse was the sole underwriter of both SolarCity deals, while Toyota’s bonds took a
syndicate of Citi, BAML and Morgan Stanley. Hannon Armstrong has not disclosed their
underwriter.
Table 8: Underwriters of green ABSs
Deal Underwriters
SolarCity 2013 Credit Suisse
SolarCity 2014 Credit Suisse
Toyota ABS Citigroup
Bank of America Merrill Lynch
Morgan Stanley
Hannon Armstrong Not disclosed
Western Riverside PACE Deutsche Bank
Source: Bloomberg, Bloomberg New Energy Finance
Holdings
On the holdings side little has been disclosed, and no information is available on SolarCity’s 2014
issue, or Hannon Armstrong’s ABS. Deutsche Bank indicated that buyers for their PACE bond
included top US insurance companies and asset managers.
Table 9: Toyota ABS holdings

Investor Sector $m
TIAA-CREF Asset manager 49.0
JPMorgan Chase Banking & asset management 10.9
Vanguard Group Asset manager 9.0
Northern Trust Asset manager 4.4
SEI Investments Asset manager 2.9
Table 10: SolarCity 2013 ABS holdings

Investor Sector $m
Aviva Insurance 7.5
Blackrock Asset manager 6.2
Angel Oak Capital Advisors Asset manager 6.0
Transamerica Life Insurance 5.0
Accordia Life & Ann Insurance 5.0
2 JUNE 2014
SECTION 5. PROJECT BONDS

5.1. OVERVIEW
Over $3.1bn of clean energy project bonds were issued in 2013, a 53% increase from 2012. Nearly
a third of the total volume was attributable to a single project, a $1bn issue backed by the 580MW
Figure 10: Project bond Solar Star PV project, owned by US-based Berkshire Hathaway Energy. The remainder of issuance
issuance since 2011 ($bn) came from solar, wind and a first-of-a-kind offshore wind transmission. Geographically issuance
4.0 was spread across UK, US, Canada and South Africa. Thus far in 2014, issuance has been muted
3.0 compared to previous years, consisting of one $172bm bond.
2.0 As a percentage of total project finance – the method of financing projects that involves the creation
1.0 of a dedicated bankruptcy-remote company to finance and develop a project – renewable energy
accounted for 18% of total volume in 2013; as a percentage of total project bond volume, it
0.0
2011 2012 2013 accounted for 12%, down slightly from its share in 2012 (Table 11).
Source: Bloomberg New Energy
Table 11: Clean energy project finance and bond finance versus other infrastructure
Finance
Space Type 2011 2012 2013
Project financing Other infrastructure ($bn) 210 151 245
Clean energy ($bn) 73 51 43
Total ($bn) 283 202 288
Clean energy, % total (%) 34.6% 33.6% 17.6%
Project bonds Other infrastructure ($bn) 5.80 14.85 26.87
Clean energy ($bn) 2.20 2.15 3.13
Total ($bn) 8.00 17.00 30.00
Clean energy, % total (%) 38.0% 14.5% 11.7%
Source: Bloomberg New Energy Finance, Infrastructure Journal
In the last 12 months, two large wind portfolio bonds have been issued: one from US-based Exelon
backed by 13 wind farms and one from Swedish developer Arise with 10 wind farms. As the
pipelines of European and US-based large-scale onshore wind and PV projects dwindle, these
types of portfolios issues – which produce bonds off of groups of smaller projects – could be a
signal that renewables bond issuance won’t grind to a complete halt, and that after a multi-year lull
in portfolio bond issuance the market’s appetite for these products has rebounded.
5.2. KEY PROJECT BONDS

US-based Berkshire Hathaway Energy (formerly known as MidAmerican Energy) led the project
bond charge in 2013, issuing a $250m bond for its Topaz PV project (following up on $850m issued
for the same project in 2012) and a benchmark $1bn bond to finance the Solar Star PV plant
(previously known as Antelope Valley), which it acquired from SunPower Corp earlier in the year.
Exelon, a US utility with a large wind portfolio, jumped into the market with a $613m senior secured
bond in September backed by 667MW of wind from 13 different projects across Idaho, Kansas,
Michigan, Oregon, New Mexico and Texas.
Two UK-based renewable infrastructure funds sold bonds to finance or re-finance portfolios of UK-
sited PV projects: Foresight Group and the Renewable Financing Company. Also from the UK came
a first-of-a-kind offshore wind transmission bond wrapped with a partial guarantee from the
European Investment Bank as part of the EU’s 2020 Project Bond Initiative. The bond finances the
Greater Gabbard Offshore Transmission Link, bringing power from the 504MW Greater Gabbard
2 JUNE 2014
offshore wind farm to the UK mainland grid. The EIB guarantee enabled the deal to obtain an A3
credit rating from Moody’s, letting it lock in a relatively low 4.14% coupon for the 19-year maturity.
Table 12: Key project bond issuances since January 2013
Project Technology Country MW Date $m Notes

Comber Wind Canada 166 Feb 13 440 25 + investors
Westmill Solar PV UK 7 Feb 13 19 Community-owned solar
Cooperative cooperative; debt sold to
a pension fund
Topaz II PV US 586 Apr 13 250 Follow up to $850m
Topaz I bond (issued in
Feb 2012)
Soitec CPV South 44 Apr 13 112 First renewable project
Africa bond in South Africa
Solar Star PV US 579 Jun 13 1,000 Owned by Berkshire
(previously Hathaway Energy (as
Antelope with Topaz PV); largest
Valley) renewable project bond
ever
Foresight PV UK 16 May 13 91 Refinancing part of
Group Foresight’s UK portfolio
Continental Wind US 667 Sep 13 613 Portfolio of 13 Exelon-
Wind owned projects
Greater Transmission UK 497 Nov 13 496 First offshore wind
Gabbard transmission link bond,
Offshore Link EIB Project Bond credit
enhancement
Renewable PV UK 20 Dec 13 108 Backed by six solar
Financing Co parks in the UK
Arise AB Wind Sweden 145 Mar 14 172 Portfolio of 10 wind
projects in Sweden
So far this year Swedish wind developer Arise AB is the sole project bond issuer. Its bond is senior
secured, sized at SEK 1bn ($172m), and maturing in 2019. The bond is secured by a portfolio of
operational wind farms in southern Sweden and was confirmed as compliant with Green Bond
Principles, with certification firm DNV GL.
Figure 11: Project bond issuance 2011-present (coupon, year, size $m)
Coupon (%)
9.0
Oaxaca IV, BBB-
Desert Sunlight Oaxaca II, BBB- Antelope Valley, BBB-
8.0 (U), BBB- Arlington Valley II,
Baldwin, NAIC 2 BBB- (implied)
Comber, BBB Continental Wind, BBB-
7.0
Granite Reliable Mount Signal, NR
Power, BB
6.0
Topaz, BBB-
Genesis (U), A-
5.0
Genesis (G), AAA Greater Gabbard, A3
4.0 L'Erable, NR
St Clair, BBB Topaz II, BBB
Arise AB
3.0
Granite Reliable Power, Solar Power
AAA Generation
2.0 Desert Sunlight (G), AAA Ltd, NR Renewable Financing
Foresight Group, NR
Westmill Solar Company,
1.0
Cooperative, NR
0.0
Jan 11 Jul 11 Feb 12 Aug 12 Mar 13 Sep 13 Apr 14
Solar PV Wind Solar thermal Transmission $50m
Source: Bloomberg New Energy Finance, Bloomberg Terminal, Company Filings
2 JUNE 2014

Citigroup secured the top underwriting position in 2013 with 3 deals for nearly $800m in allocated
underwriting credit. The bank was involved in the Topaz second placement, the Solar Star project
and Continental Wind. Citi along with Barclays and RBS have participated in four deals together
since 2012: the initial Topaz deal ($850m), the Topaz follow-up ($250m), Solar Star ($1,000), and
Continental Wind ($613).
Figure 12: Top project bond underwriters, 2013 ($m, deals)

Number of deals
0 1 2 3 4
Citigroup
Barclays
RBS
Scotia
HSBC
Santander
Independent Debt Capital Markets
Standard Bank of South Africa
Other
0 200 400 600 800 1000
Source: Source: Bloomberg New Energy Finance, company filings. Note: Joint-lead underwriters are allocated
equal portions of each issue, data for some deals is unconfirmed by underwriters due to nature of private
placement deals.
5.4. INVESTORS
Insurance companies are typically the most common holders of project bonds – both renewable
and otherwise – due to the long-dated nature of the investments, which pair with their liabilities.
Holdings data is available for $2.7bn of the $7.1bn worth of clean energy project bonds issued
since 2011, or about 40% of issuance.
Table 13: Top reported holders of clean energy project bonds, all time
Investor Country Activities $m
AIG United States Insurance 630
Northwestern Mutual United States Insurance 261
MetLife United States Insurance 202
John Hancock United States Insurance 182
Allstate United States Insurance 160
ING Netherlands Insurance 156
Allianz Germany Insurance & financial 134
Variable Annuity Life United States Insurance 113
Hartford Canada Diversified financial 80
New York Life Group Canada Asset management 75
Source: Bloomberg New Energy Finance, Bloomberg Terminal. Note: data from reported holdings and
represents only a portion of total issued value.
2 JUNE 2014
SECTION 6. SUPRANATIONAL/INTERNATIONAL
BONDS
6.1. OVERVIEW
Supranational and international banks issued a record $7.1bn of bonds in 2013, a 70% increase
from the previous best in 2010. With $6.1bn issued year-to-date, they are on record to beat that
volume within the next few months. Since the beginning of 2013 export credit banks Export
Development Canada (EDC) and Korea Export-Import (KEXIM) as well as Dutch development bank
FMO have entered the market, and the African Development Bank got back into the space after a
two-year hiatus.
Average issuance size jumped 370% in 2013 to $375m from $86m in 2012 as banks began to bring
benchmark-size bonds to the market: the World Bank has issued two $1bn bonds since Q1 2013.
Structures evolved as well: in March 2014, the European Investment Bank issued its first ever green
Samurai bond (yen-denominated bonds issued in Tokyo by foreign companies) and the World Bank
launched its first ever green Kangaroo bond (Australian dollar-denominated bonds issued in
Australia by foreign companies). These structures allow issuers to take advantage of demand for
foreign currency-denominated debt while capitalising on the growth in demand for green fixed
income products.
Figure 13: Supranational/international green bond issuance by bank ($bn)

8 Other
7
African
6 Development
Bank (AfDB)
5 Asian
Development
4 Bank (ADB)
World Bank: IFC
3
2 World Bank:
IBRD
1
European
0 Investment Bank
2007 2008 2009 2010 2011 2012 2013 2014 (EIB)
Source: Source: Bloomberg New Energy Finance
The use of bond proceeds varies by bank, and the level of transparency into the end use ranges
from very little to nearly complete. We took a look into the disclosed funded projects by the top three
all-time green bond issuers and broke them into a few simple categories (Figure 14).
The EIB’s proceed use seems the most limited: their funds have gone almost entirely to renewable
energy projects like offshore wind – which has received $571m in funding across five separate
European projects – or to transmission projects with an emphasis on connecting renewable assets
to the grid or increasing grid connectivity to cope with more renewables. The African Development
Bank also leans towards renewables and transmission, but has funded two water projects: a
wastewater treatment plant in Egypt and an irrigation water-use reduction project in Morocco. The
World Bank is significantly broader in their fund allocation: five of their 36 disclosed projects were
in renewable energy (and in fact two of those also include energy efficiency components), while the
2 JUNE 2014
rest were spread across climate change adaptation and mitigation, low carbon urban transport,
forestry and various types of energy efficiency improvements from residential to industrial
installations.
A full list of the disclosed funded projects from these banks is available in the attached spreadsheet.
Figure 14: Disclosed use of proceeds by bank ($bn)
Renewable energy
Transmission
Energy efficiency
Transport
Climate change
Water
Forestry
0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0

European Investment Bank (EIB) World Bank (IFC & IBRD) African Development Bank
Source:: Bloomberg New Energy Finance, bank reports

While supranational/international bonds are technically issued by banks these organizations do not
have investment banking arms and thus they still require the services of the private sector in order
to issue and place their debt.
Swedish bank SEB led issuance in 2013 with over $1.2bn in underwritten debt across eight different
deals. They maintain this lead thus far in 2014 with $726m in allocations. Deutsche Bank – who
was absent from the market in 2013 – has come back strong so far this year and has $650m to its
name, putting it in second place year-to-date.
Figure 15: Top supranational/international green bond underwriters, 2013 ($m, deals)
Number of deals
0 1 2 3 4 5 6 7 8 9
SEB
Morgan Stanley
Bank of America ML
JPMorgan
Credit Agricole
Citi
Unicredit
DZ Bank
Rabobank
Nomura
Danske Bank
LBBW Securities
HSBC
LBBW Securities
TD Securities
Zuercher Kantonalbank
0 200 400 600 800 1,000 1,200 1,400
2 JUNE 2014
Source:: Bloomberg New Energy Finance, Bloomberg Terminal. Note: Joint-lead underwriters are allocated
equal portions of each issue, data for some deals is unconfirmed by underwriters due to nature of private
placement deals.
6.3. INVESTORS
Data on the holders of supranational and international bank debt is slim: of $18bn in active green
supranational bonds, publicly filed holdings data only accounts for $1.7bn. Due to the breadth of
international holdings, many holders do not fall under US or European regulations that require
disclosure. Rather than look at individual holdings, we use recently disclosed data from World Bank
as a sample of the types of buyers interested in this market (Figure 16).
Figure 16: Top disclosed buyers of World Bank IBRD bonds, 2013-present
Superannuation
funds
Insurance 6%
companies
Asset
12%
managers
31%
Official
institutions
12%
Banks
Pension funds treasuries &
19% corporates
20%
Source: Bloomberg New Energy Finance, World Bank. Note: data accounts for 73% of the total value issued
by the IBRD during this time; data was not disclosed for the remaining 27% of issues.
2 JUNE 2014
SECTION 7. GOVERNMENT & MUNICIPAL BONDS

Government entities issued $910m in green bonds in 2013 as a number of new programmes and
issuers came to market, accounting for $677m of total volume. One of the two previously existing
US municipal bond schemes – the Qualified Renewable Energy Bond (QECB) – made up the
remainder, while the other programme – and Clean Renewable Energy Bonds (CREB) – saw zero
issuance for the second straight year. Thus far in 2014 $1.2bn has been issued, almost entirely
from the international segment.
Figure 17: Government & municipal issuance over time ($m)

1,600
1,400
US Other
1,200
1,000
QECB
800
600 CREB
400
200 International
0
2009 2010 2011 2012 2013 2014
US
Issuances from the Build America Bonds QECB programme are still flowing, and the market
appears to have had its best year ever in 2013 with $230m raised. In contrast, we have not tracked
a single CREB issuance since 2012. Small average issuance sizes in the QECB market make it
hard to track all issuances, but figures we have complied, coupled with data from the Energy
Programs Consortium, illustrate show that QECB issuance passed the $1bn mark in 2014, while
CREB issuance remains flat at about $400m. Total issuance is still small relative to the total amount
allocated to each programme (Table 14). The QECB programme stands at 31% of allocation CREB
at about 17%.
Table 14: QECB and CREB issuance versus allocation
Program Issued ($bn) Allocated ($bn) %

QECB 1.0 3.2 31
CREB 0.4 2.4 17
Total 1.4 5.6 25
Source: Bloomberg New Energy Finance, Energy Programs Consortium
The use of proceeds varies significantly, and by definition CREB bonds can only be used for clean
energy projects. The most common use for QECB proceeds is energy efficiency followed by
hydropower (Figure 18).
2 JUNE 2014
Figure 18: CREB & QECB issuance by use of proceeds ($m)

600 Advanced
transport
500 Wind
Landfill gas
400
Smart grid
300
Solar - PV
200
Hydro
100 Unknown
0 Energy
2010 2011 2012 2013 efficiency
Other programmes are popping up in the US as states and municipalities seek to leverage
municipal bond markets to fund their state renewable energy and energy efficiency goals.
Massachusetts issued a $100m green bond to finance water quality, energy efficiency and pollution
mitigation projects. At the federal level, US Representatives Zoe Lofgren and Doris Matsui re-
introduced the Clean Energy Victory Bonds Act with the goal of raising up to $50bn for renewable
energy through small denomination bonds for US investors.
International
Three government authorities entered the market in 2013: two regional German banks plus the City
of Gothenburg Sweden. Ile de France – the governing authority of Paris and its environs – issued
its second bond in April 2014 (its first was on March 2012): an $829m issue with proceeds
earmarked for a broad array of projects including typical renewable energy and energy efficiency
developments plus innovative uses like ecological corridor development. The Indian Renewable
Energy Development Authority issued $91m in bonds, bringing their all-time issuance to $290m,
the proceeds of which are used to make loans to project developers. The government of Ontario,
Canada has indicated that it will enter the market in the coming months with a bond to fund mass
transport.
Table 15: International government green bond issuance since 2013

Issuer Country Use of proceeds Date Value ($m)
Indian Renewable Energy India Loans for renewable 10 May 2013 91
Development Authority energy
(IREDA)
City of Gothenburg Sweden Loans for renewable 3 Oct 2013 13
energy, energy efficiency,
adaptation
NRW Bank Germany Water management 27 Nov 2013 340
Landwirtschaftlich Germany Loans for renewable 20 Aug 2013 67
Rentenbank energy
Ile de France France Investments in renewable 14 Apr 2014 829
biodiversity
County of Stockholm Sweden Transport & green 19 May 2014 167
buildings
City of Gothenburg Sweden Loans for renewable 3 Jun 2014 270
adaptation
2 JUNE 2014
ABOUT US
Subscription details Renewable Energy, Energy Smart Technologies
[email protected]
Contact details
Joseph Salvatore, CFA
Senior Associate, Capital Markets
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GREEN BONDS

SECTION 3. CORPORATE SELF-LABELLED BONDS _______________ 9

SECTION 4. GREEN ASSET-BACKED SECURITIES_______________ 12

SECTION 5. PROJECT BONDS _______________________________ 16

SECTION 6. SUPRANATIONAL/INTERNATIONAL BONDS __________ 19

SECTION 7. GOVERNMENT & MUNICIPAL BONDS _______________ 22

SECTION 1. EXECUTIVE SUMMARY

2.1. MARKET SIZE

Figure 1: Historical green bond issuance, by type ($bn)

Figure 2: Green bond issuance versus US corporate debt ($bn)

Table 1: Our definition of the green bond universe

The ongoing definition debate

SECTION 3. CORPORATE SELF-LABELLED BONDS

Table 2: Example verifiers used for corporate green bonds

Verifier Location Background

Table 3: Self-labelled corporate bond issuers

3.2. LEAD UNDERWRITERS

0 200 400 600 800 1,000 1,200

Table 4: Top reported holders of self-labelled corporate bonds, all time

SECTION 4. GREEN ASSET-BACKED SECURITIES

Table 5: Green ABS deals to date

4.2. SOLARCITY 2013 ABS IN DEPTH

Residential Commercial Lease PPA

Source: SolarCity filings, Bloomberg New Energy Finance

ABS pricing and structure

Table 7: SolarCity securitisation characteristics versus other ABS types, US market

4.3. UNDERWRITERS & INVESTORS

Table 8: Underwriters of green ABSs

Table 9: Toyota ABS holdings

Table 10: SolarCity 2013 ABS holdings

SECTION 5. PROJECT BONDS

5.2. KEY PROJECT BONDS

Table 12: Key project bond issuances since January 2013

Project Technology Country MW Date $m Notes

Solar PV Wind Solar thermal Transmission $50m

Source: Bloomberg New Energy Finance, Bloomberg Terminal, Company Filings

5.3. LEAD UNDERWRITERS

Figure 12: Top project bond underwriters, 2013 ($m, deals)

Figure 13: Supranational/international green bond issuance by bank ($bn)

Source: Source: Bloomberg New Energy Finance

Figure 14: Disclosed use of proceeds by bank ($bn)

0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0

6.2. LEAD UNDERWRITERS

SECTION 7. GOVERNMENT & MUNICIPAL BONDS

Figure 17: Government & municipal issuance over time ($m)

Table 14: QECB and CREB issuance versus allocation

Program Issued ($bn) Allocated ($bn) %

Figure 18: CREB & QECB issuance by use of proceeds ($m)

Table 15: International government green bond issuance since 2013

Senior Associate, Capital Markets

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