Models of Green Bond Issuance

Model Cases of Green Bond Issuance

In the Green Bond Guidelines, 2017, several Green Bond issuance model cases are examined, and the issuer, nature of the green project, the green bond scheme, and others were presented in each case.

CASE 1
An SPC executing wind and solar power generation projects raises funds for the projects.
CASE 2
A financial institution raises funds for loans for renewable energy projects, such as solar, wind, and biomass power generation, and the construction of energy efficient houses and other buildings.
CASE 3
A waste treatment company raises funds for the construction of a new facility to recover rare metal in its plant premises and the installment of advanced treatment equipment in the facility for wastewater containing hazardous chemicals.
CASE 4
A manufacturing company raises funds to renovate plants to increase energy efficiency and to build a new energy efficient head office building.
CASE 5
A financial company, a group company of an automobile manufacturer, raises capital by securitizing loan claims for loans to purchasers of low-emission electric and hydrogen vehicles through a trust plan.
CASE 6
A local government raises capital to implement renewable energy, energy efficiency, waste treatment, and flood control projects as part of a climate change adaptation program.
  • Please refer to the Green Bond Guidelines, 2017 Chapter 4 Model Cases for more information.
  • Note, however, that these model cases of issuance are only examples and many other cases exist where Green Bonds can be used.

Green Bond Issuance Case Studies

The Ministry of the Environment is implementing Pilot Project for Green Bond Issuance, in order to introduce Green Bonds issuances cases that comply with the “Green Bond Guidelines 2017” and can be regarded as model cases to promote issuance and investments of Green Bonds in Japan. As of May 2018, the compliance of the issuances of three companies, namely the Japan Railway Construction, Transport and Technology Agency, Hokuriku Green Bond Co., Ltd., and NYK Line, were confirmed.

case1 Projects for clean transportation Japan Railway Construction, Transport and Technology Agency An Illustration:都市鉄道利便増進事業として進められている神奈川東部方面線の路線図

  • Selected in the first offering for the 2017 project for creating a Pilot Project for Green Bond Issuance.
  • In November 2017, a pre-issuance report was released after compliancewas confirmed by the Ministry of the Environment and the Verifiers.

Project overview (use of proceeds)

The following two railway paths have been newly established on Kanagawa eastern district line (Sotetsu/ JR direct lines, Sotetsu/ Tokyu direct lines) as part of the project promoting urban railway convenience.

  • A connecting line between Nishiya Station on the Sotetsu Main Line and the area of Yokohama Hazawa Station on JR East Tokaido Freight Line (approx. 2.7 km).
  • A connecting line between the area of Yokohama Hazawa Station on JR East Tokaido Freight Line and Hiyoshi Station on the Tokyu Toyoko Line (approx. 10.0 km).
An Illustration:北陸地域地方公共団体完全LED化包括事業におけるグリーンボンドの発行フレームワークの事業スキーム図

Source: Japan Railway Construction, Transport and Technology Agency

Environmental benefits
Reduction of CO2 and NOx emissions by shifting transportation mode from automobiles to railway (modal shift)
1,800 t-CO2/year
18 t-NOx/year
Verifiers
E&E Solutions Inc.
Japan Credit Rating Agency, Ltd.
Sustainalytics
Pre-issuance report
Pre-issuance report (Japanese text only.)PDF

case2 Projects for energy-efficiency Hokuriku Green Bond Co., Ltd.

  • Selected in the second offering for the 2017 project for Pilot Project for Green Bond Issuance.
  • In March 2018, the pre-issue report was released after compliance was confirmed by the Ministry of the Environment and Verifiers.

Project overview (use of proceeds)

Project to change existing lighting equipment owned by municipalities in three Hokuriku districts into LED by an ESCO project

Schematic diagram

Role sharing within the scheme
  • Hokuriku 1st GB Project Co., Ltd.: Green bond issuance, representative of the project, fund management, etc.
  • Hokuriku Green Bond Co., Ltd.: Green Bond issuance support, projectmonitoring, reporting, etc.
  • Selected operators: survey, design, management system development, construction, operation, and maintenance, etc.

Source: pre-issuance report of the compliance check (2) with the Green Bond Guidelines related to FY2017 Pilot Project for Green Bond Issuance

Environmental benefits
Reduction of CO2 emissions through energy conservation by using LED lighting equipment
Verifiers
Rating and Investment Information, Inc.
Pre-issuance report
Pre-issuance report (Japanese text only.)PDF