Over the last few years, the market for municipal green bonds has been burgeoning in cities around the world, as a way for them to pay for infrastructure such as energy, water and transportation systems. Yet cities have had to independently navigate the often complex process of issuing green bonds…until now.
Today, the U.S. branch of the Green City Bonds Coalition – of which C40 is a key member – released The Green Muni Bonds Playbook, a comprehensive guide to unlock this type of financing for cities and public entities around the world.
So what is a green bond, and why are they necessary?
Green bonds are just like other bonds, except that the funds generated are specifically earmarked to finance sustainable infrastructure and services, such as renewable energy and public transportation. Green bonds offer investors accessible, climate-friendly fixed income investments, and provide a pathway to financing climate action; this is critical: the World Bank predicts that cities will require $100 billion in annual investment for climate mitigation alone.
C40 Head, Finance and Economic Development Initiative James Alexander said:
"As demonstrated by the successful green bond issuance in Johannesburg and the preparations for green bonds being made in a number of C40 cities, green bonds have great potential to support the financing requirements of cities as they strive to become more sustainable and resilient. The C40 Sustainable Infrastructure Finance Network will continue to support our cities as the green muni bond market takes shape."
Member organizations of the U.S. Green City Bonds Coalition include As You Sow, C40 Cities, CDP (formerly Carbon Disclosure Project), Ceres, Climate Bonds Initiative, and Natural Resources Defense Council.
To view the playbook, click here.
For more information on green bonds, click here.
For more on C40’s Sustainable Infrastructure Finance network, click here.
Follow the online conversation around green bonds with the hashtag #GreenCityBonds.