New report: 2018 Canadian green bond issuance reached $5.5bn, as Canada hits major sustainable finance milestones, issues first ever green bond from a pension fund globally

Ottawa, CANADA


OTTAWA and LONDON, Feb. 26, 2019 (GLOBE NEWSWIRE) -- Smart Prosperity Institute and the Climate Bonds Initiative have released Green Finance State of the Market – 2018, the seventh annual stocktake of green bonds and sustainable finance in Canada.

State of the Market Canada results from a longstanding partnership between the two organisations and is a country-based supplement to the flagship Bonds and Climate Change: State of the Market global report produced by Climate Bonds.

The Canadian report marks domestic highlights from the past year, details emerging trends, and identifies specific opportunities for green bond market development.

2018 Highlights:

  • 2018 annual Canadian green bond issuance reached C$5.5 billion, just shy of 2017’s all-time high of C$5.6 billion.
  • Canada placed 10th globally in 2018 issuance and 9th globally in cumulative issuance with more than C$15.2 billion.
  • Canada’s largest ever green bond was issued by Canada Pension Plan Investment Board (CPPIB) (C$1.5 billion). It is the first ever green bond from a pension fund globally.
  • Sub-national governments continued to drive issuance, with the Province of Ontario as Canada’s largest issuer.
  • Renewables and transportation dominated the use of proceeds, with cumulative allocations of 32% and 30% respectively.

Key Recommendations:

  • Ambitious climate commitments and policy have been put in place to transition to a low-carbon economy. A growing Canadian green bonds market can be instrumental in steering private sector and international capital flows to finance this transition.
  • The creation of a Canadian sovereign green bond and implementing recommendations from the Expert Panel on Sustainable Finance would send strong market signals and contribute to advancing the country’s climate change agenda.
  • Canadian banks, pension funds, and institutional investors must play a more active role in developing green financial instruments and the domestic green bond market to meet investor demand and enhance environmental outcomes.

Quotes:

Mike Moffatt, Senior Director, Policy and Innovation at Smart Prosperity Institute:

"As Canada continues to ramp up its climate policy ambition, green bonds have the potential to harness much-needed private capital flows to finance the transition to a cleaner, low-carbon economy.”

“Canada continues to take a leadership position in green bonds, with the Canada Pension Plan Investment Board issuing a $1.5bn green bond, the world's first ever from a pension fund. We expect 2019 to be another year of firsts for Canada in this growing field."

Sean Kidney, CEO, Climate Bonds Initiative:

“The report reflects a 2018 mix of growing sub-sovereign and sub national issuance, repeat green issuance from corporate leaders and increased engagement from banks and institutional investors. This is the platform for Canada to progress on green finance. The coming Expert Panel final report will provide impetus for wider policy reforms. Taken together, this emerging blend of private and public sector activity provides Canada with an open opportunity to create a national model of sustainable investment that supports climate action and low carbon economic growth.”

Links:

Download “Bonds and Climate Change: Green Finance State of the Market Canada” here.

Climate Bonds Contact:

Andrew Whiley,
Head of Communications and Media
Climate Bonds Initiative (London)
+44 (0) 7914 159 838
andrew.whiley@climatebonds.net  
Smart Prosperity Institute Contact:

Mac Radburn
Communications & Outreach Officer
Smart Prosperity Institute (Ottawa)
 613-322-6631
mac@smartprosperity.ca  

About Smart Prosperity Institute: Smart Prosperity Institute (formerly Sustainable Prosperity) is a national research network and policy think tank based at the University of Ottawa. We deliver world-class research and work with public and private partners – all to advance practical policies and market solutions for a stronger, cleaner economy.

About the Climate Bonds Initiative: The Climate Bonds Initiative is an investor-focused not-for-profit, promoting large-scale investment in the low-carbon economy. More information on our website here.

About the State of the Market Report:

Green Finance State of the Market Canada is jointly produced by Climate Bonds Initiative and Smart Prosperity Institute. French translation has been sponsored by Addenda Capital.

Previous Canadian State of the Market reports can be found at www.climatebonds.net and at institute.smartprosperity.ca/