NTMA to sell up to €1.5bn of ‘green bonds’

The National Treasury Management Agency (NTMA) has hired a group of banks and securities firms to sell as much as €1.5 billion of bonds to finance "green" projects.

The move comes a year after the State’s debt management agency tapped this fast-growing area of global debt markets for €3 billion in an inaugural green-bond sale.

Barclays, Bank of America Merrill Lynch, BNP Paribas, Danske Bank, Davy and JP Morgan have been hired as the lead managers of the bond sale.

“The transaction is expected to be launched and priced in the near future subject to market conditions,” the NTMA said in a statement.

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Market sources said that the agency aims to raise between €1 billion and €1.5 billion from the transaction.

Green bond funds will be used to finance eligible projects, such as sustainable water and waste management, clean transportation and renewable energy deals, as the National Development Plan targets €23 billion of spending on green energy schemes over the next decade.

Minster for Finance Paschal Donohoe said in his Budget 2020 speech on Tuesday that climate change "is without doubt the defining challenge of our generation", as he announced plans to increase carbon tax from €10 per tonne to €16, as part of a trajectory to reach €80 per tonne by 2030.

“We need to prove that we can grow the economy while reducing our environmental impact,” Mr Donohoe said.

The NTMA has so far raised €12.3 billion of long-term debt in 2018, compared to its full-year target of €14 billion and €18 billion. The money to be raised from sale of green bonds is included in the target.