The EnBW green bonds: Investing in the future of energy
In line with our strategy of developing into a sustainable and innovative infrastructure partner, we are investing increasingly in climate-friendly growth projects. Therefore, we plan to invest a total of around €14 bn between 2021 and 2025, 80% of which will be spent on growth projects (focusing on grid expansion, expansion of renewables and further development of our smart infrastructure for customers). In addition, we aim to reduce our CO₂ emissions in Scopes 1 and 2 by 2035 in line with the 1.5° pathway of the Paris Climate Agreement and neutralize remaining emissions via recognized offset projects. Moreover, we added an SBTi approved reduction target for indirect emissions in scope 3.
Since 2018, our green bonds have been contributing on the road to decarbonization. In 2022, funds from green bonds also went into the expansion of electricity distribution networks for the first time. The energy transition requires infrastructure, which is why a large part of our investment is focused on expanding the grids.
Allocation of EnBWs green bond proceeds
Key data on EnBW green bonds
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Bond type
|
Rating (Moodys / S&P)
|
Issue size (€m)
|
Net issue proceeds (€m)
|
Issue date
|
Term (years)
|
Coupon (% p.a.)
|
Denomination (€)
|
ISIN
|
|---|---|---|---|---|---|---|---|---|
|
Bond type
Green Senior
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Rating (Moodys / S&P)
Baa1 / A-
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Issue size (€m)
500
|
Net issue proceeds (€m)
496.42
|
Issue date
31.10.2018
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Term (years)
15
|
Coupon (% p.a.)
1.875
|
Denomination (€)
1,000
|
ISIN
XS1901055472
|
|
Bond type
Green Subordinated
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Rating (Moodys / S&P)
Baa3 / BBB-
|
Issue size (€m)
500
|
Net issue proceeds (€m)
498.25
|
Issue date
05.08.2019
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Term (years)
60
|
Coupon (% p.a.)
1.625
|
Denomination (€)
100,000
|
ISIN
XS2035564629
|
|
Bond type
Green Subordinated
|
Rating (Moodys / S&P)
Baa3 / BBB-
|
Issue size (€m)
500
|
Net issue proceeds (€m)
498.25
|
Issue date
05.08.2019
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Term (years)
60.25
|
Coupon (% p.a.)
1.125
|
Denomination (€)
100,000
|
ISIN
XS2035564975
|
|
Bond type
Green Subordinated
|
Rating (Moodys / S&P)
Baa3 / BBB-
|
Issue size (€m)
500
|
Net issue proceeds (€m)
494.75
|
Issue date
22.06.2020
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Term (years)
60
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Coupon (% p.a.)
1.875
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Denomination (€)
100,000
|
ISIN
XS2196328608
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|
Bond type
Green Subordinated
|
Rating (Moodys / S&P)
Baa3 / BBB-
|
Issue size (€m)
500
|
Net issue proceeds (€m)
498.25
|
Issue date
24.08.2021
|
Term (years)
60
|
Coupon (% p.a.)
1.375
|
Denomination (€)
100,000
|
ISIN
XS2381272207
|
|
Bond type
Green, Senior
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Rating (Moodys / S&P)
Baa1 / A-
|
Issue size (€m)
500
|
Net issue proceeds (€m)
498.75
|
Issue date
22.11.2022
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Term (years)
4
|
Coupon (% p.a.)
3.625
|
Denomination (€)
1,000
|
ISIN
XS2558395351
|
|
Bond type
Green, Senior
|
Rating (Moodys / S&P)
Baa1 / A-
|
Issue size (€m)
500
|
Net issue proceeds (€m)
498.75
|
Issue date
22.11.2022
|
Term (years)
7
|
Coupon (% p.a.)
4.049
|
Denomination (€)
1,000
|
ISIN
XS2558395278
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Sustainable projects with sustainable finance
We invest the proceeds from our green bonds in sustainable environmental and climate change mitigation projects. These include onshore wind power, offshore wind power and photovoltaics. We are also pressing ahead with the expansion of charging infrastructure for electric mobility.
Wind offshore
42% (€1,483 million) of the €3.5 billion we have raised with green bonds so far went into the following projects.
The Hohe See and EnBW Albatros offshore wind farms have been connected to the grid since October 2019 and January 2020 respectively. At the time of commissioning, they were Germany’s biggest offshore wind farms.
Furthermore, EnBW and bp are developing offshore wind farms in a 50:50 partnership in the UK. In the auction for the award of seabed rights by The Crown Estate, EnBW and bp secured two large high-value areas in the Irish Sea. The plans are to build two offshore wind farms there with a combined capacity of three gigawatts and to bring them into operation from 2028.
Wind onshore
Germany is one of the European leaders in onshore wind with some 58,106 MW¹ of installed capacity. EnBW contributes here and continues to drive the expansion of wind power – not only in its home market of Germany but also in selected foreign markets.
22% (€782 million) of the €3.5 billion we have raised with green bonds so far went into onshore wind farms.
As well as numerous wind farms in Germany, these also include our newly acquired or constructed wind farms in Sweden. We also plan further expansion in this renewable energy subsector and are looking here beyond the boundaries of our home state of Baden-Württemberg, and also beyond Germany.
¹Source: Bundesverband WindEnergie e. V. (BWE) (German Wind Energy Association)
Charging infrastructure for electric mobility
4% (€55 million) of the green bonds issued to date went on financing the expansion of fast-charging infrastructure.
We are the German market leader in electric mobility. And we are systematically expanding our nationwide EnBW charging network. In addition to rolling out our fast-charging network for long-distance travel, we are now adding fast-charging stations in urban locations.
EnBW financed 1,096 charging points at 561 locations from green bonds. Our target is 2,500 fast-charging locations throughout Germany by 2025. In the expansion of charging infrastructure, we are working in partnership with companies such as Shell, Euronics, haugebau and the Tank & Rask roadside services chain, for which we are installing high-capacity charging points.
Solar (PV)
4% (€169 m) of the green bond net proceeds were used to finance a range of photovoltaic installations. Solar is the third pillar of EnBW’s renewable energy activities alongside wind and hydropower, and is a key part of the transition to renewables. By 2025, EnBW aims to expand solar power to some 1.200 megawatts, primarily by building large-scale installations.
With the Weesow-Willmersdorf project, EnBW has built what at the time of commissioning was the largest solar park in Germany in Brandenburg. Likewise in Brandenburg, the Gottesgabe and Alttrebbin solar parks with a capacity of 150 megawatts each were connected to the grid at the beginning of 2022. Together with Weesow-Willmersdorf, the three installations will have a total output of some 500 megawatts.
Acquisition of Valeco
The proceeds of the €500 million green subordinated bond issued on 22 June 2020 went in full on refinancing the acquisition of Valeco. This is 14% of the €3.5 billion we have raised in total via green bonds.
In June 2019, EnBW acquired Groupe Valeco based in Montpellier, France. The VALECO Group is a French company that specializes in developing, financing, realizing, operating and maintaining renewable energy production plants in France and internationally.
In acquiring Valeco, EnBW lastingly strengthened its renewable energy activities, which are a central pillar of the company’s future. At the same time, with Valeco’s existing project pipeline, it secured growth opportunities in one of the most important renewable energy markets in Europe. Those opportunities are now being realised step by step.
Electricity distribution grids
The proceeds from the seven-year bond (XS2558395278) were used for the first time to develop the electricity distribution grids. These are essential for the expansion of renewables and the success of the energy transition. Grid development in the German state of Baden-Württemberg is the responsibility of Netze BW GmbH, a subsidiary of EnBW AG. Netze BW has already been officially recognized since 2021 as a climate-neutral distribution network operator by the internationally recognized certification company GUTcert. In addition, the electricity grid activities within the EnBW Group have already been reported as sustainable in accordance with the EU Taxonomy since 2020. This means that investments in grid development are also fully recognized by the EU as green economic activities. In order to be classified as Taxonomy-aligned activities, the development and operation of electricity grids must meet certain technical screening criteria.
The proceeds were used to refinance projects and investments of Netze BW GmbH from the years 2020 and 2021. In total, 5,338 projects were refinanced. These included a large number of small-scale and in some cases also larger measures, such as network upgrades directly or indirectly related to the increasing expansion of renewables and projects to connect charging stations for electric cars.
Good independent assessments
For independent assessments, we have obtained both a Second Party Opinion from ISS ESG and CBI certification for all of our green bonds.
ISS ESG, a rating agency internationally specialising in sustainability, has confirmed that all EnBW Green Bonds issued to date comply with the Green Bond Principles on the basis of International Capital Market Association (ICMA) criteria. In addition, ISS ESG confirmed the good sustainability quality of the bonds and also our above-average sustainability performance as the issuer (ISS ESG Prime Status). Further information is available for downloading here.
Our Green Bonds also are certified to the high standards of the Climate Bonds Initiative (CBI). The Climate Bonds Initiative (CBI) is an international organisation that works to mobilise the bond market for climate change solutions. These feature detailed sector-specific criteria for qualification as green bonds. Further information is available for downloading here.