RWE Issues Inaugural Green Bond for Sustainable Projects Worth $2 Billion

by ESG News • April 17, 2024

RWE's debut green bond issuance in the US signifies its strategic entry into the American market, aiming to raise 3.0-3.5 billion annually until 2030.

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US$2 billion dual tranche green bond, with maturities of 10 and 30 years with a coupon of 5.875% and 6.250%
Funds will be used to finance renewable energies projects according to RWE’s Green Financing Framework
High investor demand – bond oversubscribed 3.8 times

RWE successfully placed its first green US dollar bond with a total volume of US$2 billion. The bond was issued in two tranches of US$1 billion with 10-year tenor and US$1 billion with 30-year tenor, respectively. For the first tranche, the yield-to-maturity amounts to 5.926%, based on a coupon of 5.875% p.a. and an issuance price of 99.619%. For the second tranche, the yield-to-maturity amounts to 6.261%, based on a coupon of 6.250% p.a. and an issuance price of 99.852%. The issuance was met with strong interest from investors and the order book was 3.8 times oversubscribed at US$7.6 billion.

This is RWE’s first green bond placement outside Europe and marks the strategically important entry into the US bond market. RWE plans to issue 3.0-3.5 billion of bonds per year on average through to 2030 in both euros and US dollars.

Michael Müller, CFO of RWE AG: “With our first US green bond, we are expanding our sustainable financing. Going forward, we plan to be a regular issuer in both Euro and US markets. The US stands as our largest market outside of Europe where we have more than doubled our net installed capacity since 2020 to 9 gigawatts today. As one of the leading renewable energy companies in the US, we want to further expand our market position in onshore and offshore wind as well as in solar and batteries with investments of about €20 billion by the end of this decade.”

RWE intends to use the net proceeds for its ‘Growing Green’ investment and growth programme. With this, the company is making an important contribution to the success of the energy transition and the decarbonisation of the energy system. RWE has already invested €20 billion net between 2021 and 2023 and plans to invest a further €55 billion net globally in renewable energies, batteries, flexible generation, and hydrogen projects by 2030. With this, the company intends to expand its green portfolio globally to more than 65 gigawatts through the end of the decade.