In a significant move for the renewable energy sector, Dhafrah PV2 Energy has successfully priced an $870.75 million green bond to finance the Al Dhafrah PV2 solar photovoltaic plant (ADPV2) in Abu Dhabi. The 27.5-year bond, with a weighted average life (WAL) of 17 years, was issued at a coupon rate of 5.794%, offering a similar yield. The re-offer price was set at par, signaling strong demand and investor confidence in sustainable energy projects.
The Green Bond’s Key Details
The bond, which raised the company’s book size to $2.1 billion (excluding joint lead manager interest), was issued as an amortizing Eurobond, a regulatory S benchmark bond. Initially, the pricing thoughts were set at T+130 basis points over US Treasuries but were tightened to 100 basis points due to favorable market reception.
Dhafrah PV2 Energy, which has earned a credit rating of A3 from Moody’s and A from S&P with a stable outlook, is one of the leading players in the UAE’s renewable energy landscape. The bond issuance is expected to support the development of the Al Dhafrah PV2 solar plant, a key contributor to the region’s energy diversification and sustainability goals.
Key Players and Partners
The bond issuance was coordinated by BNP Paribas and HSBC as joint global coordinators, with other leading financial institutions such as Crédit Agricole CIB, MUFG, Standard Chartered Bank, and SMBC serving as joint lead managers and bookrunners.
Dhafrah PV2 Energy’s stakeholders include major entities like Abu Dhabi National Energy Company PJSC (TAQA), Abu Dhabi Future Energy Company PJSC (Masdar), EDF Renewables, and Jinko Power (HK) Company Limited from China. The bond proceeds will be used to finance or refinance projects related to the Al Dhafrah PV2 solar plant, aligning with the company’s Green Bond Framework to ensure transparency and sustainability in its operations.
This green bond issuance marks a significant milestone in the ongoing transition towards sustainable energy in the UAE. The successful pricing reflects strong investor interest in financing clean energy projects and highlights Dhafrah PV2 Energy’s position as a key player in the renewable energy sector. With the Al Dhafrah PV2 solar plant poised to play a crucial role in Abu Dhabi’s energy future, this green bond sets the stage for continued growth and investment in solar energy across the region.
