Climate Bonds Initiative has released a series of useful briefing papers on ways to mobilise the bond market for climate change solutions.
Green securitisation can help unlock finance in debt capital markets for smaller scale low carbon and climate-resilient assets. The public sector has a key role to play to scale up securitisation markets for green assets.
Covered bonds are an ideal tool to finance low carbon infrastructure, having been used in other public priority areas. Identifying existing green cover pools and developing frameworks for other low carbon assets will help scale up investment.
Initial findings indicate that there is over-subscription and tighter pricing of USD and EUR denominated green bonds in the primary market.
There is a clear potential for exchanges to create dedicated green bond segments, develop indices and support market education to facilitate investor decisions towards climate-aligned investments and enhance the market’s liquidity.
Green City Bonds are increasingly used by municipalities and other city-affiliated entities, such as utilities and transport companies, to finance climate-aligned infrastructure.