In 2021, the Group obtained new loans, in particular to support investment plans, which confirm the confidence of the financial system in planned development initiatives and make it possible to maintain an adequate balance between short- and long-term financial exposure. The Group’s focus is increasingly on sustainable finance instruments, which account for 64% of source of funding: Green Bonds, EIB (European Investment Bank) and CEB (Council of Europe Development Bank) financing that support specific projects and meet particular sustainability requirements.
As part of its Euro Medium Term Notes (EMTN) Programme of 4 billion, on 07 October 2021 Iren successfully concluded the issuance of a new Green Bond for 200 million Euro (Tap Issue) which is part of the reopening of the Green Bond of 300 million Euro issued on 10 December 2020, making it the first Italian multi-utility for the number of instruments issued in this format: 4 Green Bonds for a total of 2 billion Euro. The new issue, with a Fitch BBB rating, is listed on the regulated market of the Irish Stock Exchange, and on the ExtraMOT market of the Italian Stock Exchange in the segment dedicated to green instruments. As for the previous Green Bonds, the list of projects refinanced by the Green Bond was defined by Iren’s Sustainable Financing Committee and its correspondence to precise environmental criteria is ensured by an external body (DNV GL). The issue was earmarked for the financing and refinancing of projects in the following categories: energy efficiency, renewable sources, waste management efficiency and recycling, wastewater treatment, efficiency improvement in water services, e-mobility.
The bonds of the new Green Bond (Tap GB4), placed at an issue price of 94.954%, reflect the characteristics of the Green Bond issued in December 2020: they have a minimum unit denomination of 100,000 Euro, pay an annual gross coupon of 0.25% and mature on 17 January 2031. The effective rate of return at maturity is 0.818%, corresponding to a yield of 67 basis points above the mid-swap rate. This issue received the market’s appreciation of the Group’s sustainability strategy, and its ability to achieve the objectives set, which outlines an ever-increasing ambition embodied in the 2030 Business Plan and the adoption of procedures dedicated to green financial instruments to ensure the necessary transparency for investors.
Iren Group has also focused its attention on identifying further innovative sustainable finance instruments, through relations with the EIB and CEB, which finance projects that meet particular sustainability requirements. In particular, in March 2021, the technical investigation with CEB was concluded for a loan of 80 million Euro to integrate a loan signed in 2020 with EIB, relating to the development projects of the district heating network in the Turin area for a total amount of 197 million Euro. These are projects that can be classified by EIB as “efficient district heating and cooling”, according to directive 2012/27/EU, which therefore fall within the provisions of the EU bank’s new energy lending policy.
|
Iren Green Bonds in circulation at 31/12/2021 |
||||||||
|---|---|---|---|---|---|---|---|---|
|
Bond |
Iren code |
ISIN code |
Bond amount (€/000) |
Ann. coupon (%) |
Maturity at issue (years) |
Maturity date |
Issue price (%) |
Rating |
|
Tap Issue Green Bond 2031 |
Tap GB4 |
XS2275029085 |
200,000 |
0.250% |
10 |
17/01/2031 |
94.954 |
BBB |
|
Green Bond 2031 |
GB4 |
XS2275029085 |
300,000 |
0.250% |
10 |
17/01/2031 |
99.030 |
BBB |
|
Green Bond 2029 |
GB3 |
XS2065601937 |
500,000 |
0.875% |
10 |
14/10/2029 |
99.345 |
BBB |
|
Green Bond 2025 |
GB2 |
XS1881533563 |
500,000 |
1.950% |
7 |
19/09/2025 |
99.129 |
BBB |
|
Green Bond 2027 |
GB1 |
XS1704789590 |
500,000 |
1.500% |
10 |
24/10/2027 |
98.356 |
BBB |
|
Total |
|
2,000,000 | ||||||
Allocation of Green Bond funds
The funds of the Green Bond issued on 7 October 2021 (Tap GB4) were allocated to 15 projects, identified by Iren, whose correspondence to specific environmental criteria was ensured by an external certification body. Starting from the date of issue and until the complete allocation of the net amount of 189,908,000 Euro, within the maximum period of 24 months, the use of liquid funds allocated to the refinancing/financing of the selected projects is monitored. An amount equal to 76% of the net proceeds (144,571,350 Euro) was used for refinancing and/or financing investments covered by previous bank lines and bonds, while the remaining part of 24% (45,336,650 Euro) will be allocated within 24 months of issue and is included in the liquidity balance as at 31 December 2021, with an allocation constraint to the refinancing/financing Eligible Projects.
For the Green Bonds issued in 2019 and 2020 (GB3 and GB4), full allocation of the cash collected within the required allocation terms occurred during 2021. The investments related to all Green Bonds issued at the end of 2021, shown in the table below, are all confirmed and present in the Group’s assets as at 31 December 2021.
|
Allocation of income from Green Bonds as at 31/12/20211 |
||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
|
Project categories
|
Tap Green Bond 2031 (Tap GB4) |
Green Bond 2031 (GB4) |
Green Bond 2029 (GB3) |
Green Bond 2025 (GB2) |
Green Bond 2027 (GB1) |
|||||
|
Investments (€) |
Proj. (no.) |
Investments (€) |
Proj. (no.) |
Investments (€) |
Proj. (no.) |
Investments (€) |
Proj. (no.) |
Investments (€) |
Proj. (no.) |
|
|
Energy efficiency |
104,196,535 |
7 |
196,784,859 |
6 |
387,503,236 |
11 |
247,991,764 |
4 |
232,587,446 |
6 |
|
Renewable sources |
9,075,639 |
1 |
33,360,992 |
5 |
4,263,000 |
1 |
134,658,410 |
5 |
161,002,995 |
7 |
|
Waste management efficiency and recycling |
52,719,803 |
4 |
47,450,547 |
6 |
35,388,104 |
3 |
7,265,347 |
1 |
42,123,504 |
1 |
|
Wastewater treatment |
18,817,532 |
2 |
8,393,602 |
3 |
61,594,858 |
4 |
100,438,533 |
1 |
56,066,055 |
4 |
|
Water service efficiency |
- |
- |
- |
- |
4,677,908 |
1 |
- |
- |
- |
- |
|
E-mobility |
5,098,491 |
1 |
- |
- |
3,297,894 |
1 |
5,290,946 |
1 |
- |
- |
|
Total allocated |
189,908,000 |
15 |
285,990,000 |
20 |
496,725,000 |
21 |
495,645,000 |
12 |
491,780,000 |
18 |
|
Issue discount |
10,092,000 |
2,910,000 |
3,275,000 |
4,355,000 |
8,220,000 |
- |
||||
|
Residual to be funded by 2022 |
11,100,000 |
- |
||||||||
|
Total issue |
200,000,000 |
15 |
300,000,000 |
20 |
500,000,000 |
21 |
500,000,000 |
12 |
500,000,000 |
18 |
1 The 86 projects indicated in the table include projects common to the 5 Green Bond issues for different years (46 projects not including common projects).
The positive environmental impacts generated by the projects funded by the Green Bonds are outlined by the main indicators shown in the table below.
More information on the Green Bonds and funded projects is available in the Sustainable Finance section of the gruppoiren.it website.
|
Project category and main indicators |
u.m. |
2021 |
2020 |
2019 |
2018 |
2017 |
|---|---|---|---|---|---|---|
| Efficienza energetica | ||||||
| Electricity produced | MWh | 3,847,662 | 3,486,789 | 3,833,955 | 3,887,199 | 3,884,511 |
| Electricity produced from renewables1 | MWh | 878 | 0 | 657 | 46 | 25 |
| Primary energy saved | MWh | 1,838,393 | 1,532,645 | 1,808,508 | 2,200,496 | 2,281,239 |
| CO2 emissions avoided by non-fossil sources | t | 578,080 | 492,287 | 616,258 | 636,478 | 724,744 |
| Thermal energy produced1 | MWh | 1,996,062 | 1,660,701 | 1,592,436 | 1,684,507 | 1,770,005 |
| Electricity input to the grid1 | MWh | 3,585,171 | 3,505,548 | 3,790,141 | 3,803,936 | 4,222,786 |
| Network leaks (electricity)1 | MWh | 87,791 | 94,613 | 154,570 | 166,866 | 158,921 |
| Electricity and gas smart meters installed | no. | 1,418,954 | 1,385,339 | 1,330,716 | 1,188,480 | 966,569 |
| Renewable sources | ||||||
| Primary energy saved | MWh | 2,497,041 | 2,101,596 | 2,827,848 | 3,254,066 | 3,663,699 |
| Electricity produced from renewables | MWh | 713,362 | 765,174 | 777,269 | 904,438 | 761,335 |
| Thermal energy distributed2 | MWh | 3,144,036 | 2,856,932 | 2,779,773 | 2,816,307 | 2,956,143 |
| CO2 emissions avoided by non-fossil sources | t | 1,057,353 | 1,074,207 | 1,320,889 | 1,371,073 | 1,581,848 |
| Waste management efficiency and recycling | ||||||
| Refuse Derived Fuel (RDF) | t | 8,461 | 9,429 | 16,523 | 2,585 | 7,886 |
| Sorted waste collected | t | 856,682 | 825,674 | 813,804 | 788,313 | 711,910 |
| Unsorted waste treated | t | 366,570 | 371,735 | 415,905 | 445,411 | 464,837 |
| Door-to-door collection services – residents
served |
no. | 1,817,913 | 1,656,415 | 1,590,536 | 1,473,268 | 1,391,087 |
| Plastic sent for recovery | t | 221,783 | 59,635 | - | - | - |
| Blupolymer product | t | 19,137 | 7,054 | - | - | - |
| Bluair product | t | 8,538 | 6,648 | - | - | - |
| Biomethane produced | scm | 1,778,145 | - | - | - | - |
| Emissions of CO2 avoided | t | 367,637 | 102,162 | - | - | - |
| Wastewater treatment | ||||||
| Equivalent residents served (potential)1 | no. | 628,878 | 625,806 | 531,528 | 515,650 | 295,650 |
| Volumes of water for reuse/Volumes of treated water | % | 32 | 31 | 32 | 30 | 30 |
| Wastewater treatment plants | no. | 1,291 | 1,310 | 1,293 | 1,278 | 1,122 |
| Sewer networks | km. | 10,842 | 10,739 | 10,662 | 10,606 | 9,924 |
| Water service efficiency | ||||||
| Smart meters installed | no. | 127,046 | 96,965 | 51,742 | - | - |
| E-mobility | ||||||
| CO2 emissions avoided by non-fossil sources2 | t | 1,420 | 1,069 | 789 | 52 | - |
1 The years prior to 2021 have undergone a restatement.
2 The year 2020 has undergone a restatement.