Monday, December 4, 2017

California Leads USA in Muni Green Bond Issues

As recently discussed in the California Green Finance blog (here), California government agencies are issuing green bonds at a record pace.  More green bonds have been sold in 2017 than all prior years combined and the total for all green bonds issued by California governments has topped $5 billion.

Newly released data from the Climate Bonds Initiative shows that California leads all other states on green bond issues that have closed, followed closely by New York State at $4.73 billion, Massachusetts at $2.83 billion, and Washington State at $1.9 billion, with Connecticut, Indiana, Colorado, Iowa, Illinois & Ohio all under $1 billion (Top 10 ranking below). 


Issuer
Cumulative Amount Issued (USDbn)
Top 10 Rank Nov 2017
California
5.03
1
New York
4.73
2
Massachusetts
2.83
3
Washington
1.97
4
Connecticut
0.83
5
Indiana
0.75
6
Colorado
0.62
7
Iowa
0.46
8
Illinois
0.37
9
Ohio
0.35
10


California green issuers ranges from large institutions such as the California Infrastructure Bank and the City of Los Angeles to school districts in Fremont and San Diego to the Mid-Peninsula Open Space District.  The chart below shows the range of California issuers and the total of all green bonds they have issued.  The prior CalGreenFinance post showed the individual issues and the general project descriptions (here).

California Cumulative Muni Green Bond Data Through Nov, 2017

Issuer
Total All Issuances
State of California IBank
$860,735,000
City of Los Angeles
$739,740,000
San Francisco Public Utilities Commission
$531,955,000
Los Angeles Metropolitan Transit Authority
$471,395,000
California Health Facilities Financing Authority
$408,390,000
Bay Area Rapid Transit (BART)
$384,735,000
State of California Treasurer's Office
$300,000,000
East Bay Municipal Utility District
$259,690,000
California Pollution Control Financing Authority
$228,165,000
City and County of San Francisco
$171,405,000
Los Angeles County Sanitation District
$170,265,000
San Diego Unified School District
$159,000,000
San Diego County Water Authority
$98,945,000
Santa Monica Public Finance Authority
$68,565,000
Midpeninsula Open Space District
$57,410,000
Port of Los Angeles
$35,205,000
Fremont Union High School District
$31,170,000
City of Long Beach
$25,985,000
Trinity Public Utilities District
$20,835,000
City of Napa
$12,500,000
Total
$5,036,090,000


A growing number of California issuers have also followed international best practice in gaining Climate Bonds Certification for their green issuance, including Bay Area Rapid Transit (BART), SFPUC and Los Angeles MTA

California leads other state in green bond issues, but
New York has issued more CBI Certified green bonds


“California has long been a national standard bearer in areas ranging from advancing civil rights to protecting our natural resources," says State Treasurer John Chiang.  "In that same vein, the State of California and its municipalities lead the U.S. in the use of green bonds, raising more than $5 billion in affordable capital to both curb climate change and build critical infrastructure.  The achievement is laudable but not enough considering how the United States still lags behind Europe, Asia, and South America in taking advantage of climate-friendly green bonds to finance the conversion of a fossil-fuel based economy to a carbon-free alternative.”


State Treasurer John Chiang

“I am working to change that equation by hosting a major green bonds symposium in February," says Treasurer Chiang.  "I am assembling the nation’s foremost experts to come up with ways to turbocharge this innovative, new market, with an eye toward unlocking its latent potential to pay for billions of dollars in investments to protect our planet from global warming.”

More information on Treasurer Chiang's Green Bond Symposium can be found at:  Green Bond Symposium

“Capital flows are moving in the right direction from diverse municipal issuers of every size across the state," said Justine Leigh-Bell, Director of Market Development for the Climate Bonds Initiative. The focus on water, energy and waste is very encouraging. The challenge now is to increase the number of green issuers across the state and encourage repeat issuance.”

Justine Leigh-Bell of Climate Bonds Initiative


“Our previous data at the end of Quarter 3 had New York State in front, but California has just nudged ahead to reach the landmark $5 billion figure for municipal green bonds," said Leigh-Bell. "The foundation is there to lead US states again and be first to reach $10 billion. We expect the State Treasurer’s February 2018 Green Bonds Symposium and Governor Brown’s Global Climate Action Summit later in 2018 will both provide sub national, national and international momentum around green investment to address climate change.”

Monday, November 13, 2017

California Green Muni Bonds Top $5 Billion

More 2017 Issuance Than All Prior Years Combined


2017 is a record year for California green bond issuances by government agencies.  And, the year isn't over yet.  In 2017:

  • More green muni bonds have been issued than all prior years combined. 
  • There have been nearly $3 billion in bonds issued this year, compared to about $2 billion from 2013 through 2016 combined.
  • More and more issuers are entering the marketplace.  The City of Long Beach, Los Angeles Metropolitan Transit Authority and the Fremont Union High School District are among the newest issuers.
  • The state of California, through the Treasurer's Office, IBank, Pollution Control Financing Authority and Health Facilities Financing Authority is the largest green muni bond issuer
State Treasurer John Chiang is looking into ways to expand the green bond market further.  He has partnered with the Milken Institute and Environmental Finance to hold a symposium February 27-28, 2018 at the Milken Institute in Santa Monica. More information on Treasurer Chiang's green bond efforts can be found at Treasurer Chiang Green Bond Symposium.

Below is a summary of all California green muni bond issuances to date. (note:  slight correction to chart made 11/28/2017)


California Green Muni Bond Issuances
IssuerDate*AmountGeneral Purposes
State of California10/7/2014$300,000,000Mass Transit, Clean Water, Energy Efficiency
San Francisco Public Utilities Commission5/20/2015$32,025,000Renewable Energy
City of Los Angeles6/4/2015$188,755,000Wastewater, Digester, Water Purification
East Bay Municipal Utility District6/17/2015$74,335,000Clean Drinking Water, Conservation, Flood Protection, Renewable Energy, Biodiversity
City of Los Angeles6/30/2015$100,835,000Wastewater, Water Purification, Digester
San Diego Unified School District1/5/2016$100,000,000Energy Efficient Buildings, Renewable Energy
IBank4/28/2016$410,735,000Clean Water, Water Pollution Control
San Francisco Public Utilities Commission5/24/2016$240,580,000Clean water, wastewater
San Diego County Water Authority6/23/2016$98,945,000Water Efficiency
Midpeninsula Open Space District9/22/2016$57,410,000Open Space Acquisition, related
Port of Los Angeles10/13/2016$35,205,000Open space, habitat, green building
City of Napa10/20/2016$12,500,000Recycling and materials recovery facility
Los Angeles County Sanitation District11/16/2016$170,265,000Reclaimed water projects, sewage system Improvements
San Francisco Public Utilities Commission12/14/2016$259,350,000Clean water projects (Climate Bond Certified)
IBank3/23/2017$450,000,000Clean Water, Water Pollution Control
California Health Facilities Financing Authority5/3/2017$408,390,000for Kaiser Hospital** System green buildings
City of Los Angeles (Taxable and tax-exempt)5/24/2017$450,150,000Sewage system upgrades
Bay Area Reapid Transit (BART) (taxable and tax-exempt)6/1/2017$384,735,000Rapid Transit (Climate Bond Certified)
California Pollution Control Financing Authority6/14/2017$228,165,000for CalAg manufacturing rice-straw to fiberboard plant
East Bay Municipal Utility District6/22/2017$185,355,000Water quality, recliamed water, environmental enhancements
City of Long Beach6/28/2017$25,985,000Enviornmental improvements at port of Long Beach
Fremont Union High School District7/11/2017$31,170,000Green buildings
Santa Monica Public Financing Authority9/14/2017$68,565,000Green buildings
Los Angeles Metropolitan Transportation Authority10/31/2017$471,395,000Mass Transit (Climate Bond Certified)
San Diego Unified School District11/1/17$59,000,000Green buildings
Trinity Public Utilities District11/1/17$20,835,000Hydroelectric Project (some taxable)
City & County of San Francisco11/9/17$171,405,000TransBay Transit Center (Taxable; Climate Bond Certified)
2014 Subtotal$300,000,000
2015 Subtotal$395,950,000
2016 Subtotal$1,384,990,000
2017 Subtotal to date$2,955,150,000
* Dated per MSRB
** companion taxable non-muni green bond for $575 million also issued)
Total All Issuances$5,036,090,000(prepared/updated by Michael Paparian Nov 28, 2017)