Green Bonds
Overview
At HASI, we are committed to ensuring all debt we issue is dedicated to eligible green projects. Typically, for corporate unsecured debt, we pursue independent verification. Since 2013, we have raised approximately $11 billion of green debt, including securitizations and non-recourse and corporate issuances. The HASI Green Bond Framework is in the process of being issued a Second-Party Opinion (SPO) by an independent rater, which will be made available to investors.
Green Debt Issuances
Secured Non-Recourse Debt
Non-recourse, asset-backed debt managed on balance sheet
Corporate Green Bonds
Senior unsecured or convertible bonds issued as corporate obligations
Other Green Debt
Syndicate CarbonCount®-Based Unsecured Revolving Line of Credit and Term Loan A and CarbonCount® Green Commercial Paper Program2
1) From IPO through 12/31/23, Including corporate bond add-on of $200m and additional secured non-recourse debt of $94m in January 2024
2) Represents total commitments of the Sustainability Linked Unsecured RLOC, Term Loan A, and Green Carbon Count Commercial Paper Program
Secured Non-Recourse Debt
Non-recourse, asset-backed debt managed on balance sheet
Corporate Green Bonds
Senior unsecured or convertible bonds issued as corporate obligations
Other Green Debt
Syndicate CarbonCount®-Based Unsecured Revolving Line of Credit and Term Loan A and CarbonCount® Green Commercial Paper Program2
Total Green Debt ~$11 Billion¹
1) From IPO through 12/31/23, Including corporate bond add-on of $200m and additional secured non-recourse debt of $94m in January 2024
2) Represents total commitments of the Sustainability Linked Unsecured RLOC, Term Loan A, and Green Carbon Count Commercial Paper Program
Green Bond Framework
In alignment with ICMA’s Green Bond Principles (2018)3
“Eligible Green Projects” means projects intended to reduce carbon emissions or provide other environmental benefits in the following categories:
Behind-The-Meter (“BTM”): Distributed building or facility projects that reduce energy usage or cost through the use of solar generation and energy storage or energy efficient improvements, including heating, ventilation and air conditioning systems (“HVAC”), lighting, energy controls, roofs, windows, building shells, and/or combined heat and power systems
Grid Connected (“GC”): Renewable projects that deploy cleaner energy sources, such as solar, solar-plus-storage, stand-alone storage, and wind, to generate or shift power production where the off-taker or counterparty may be part of the wholesale electric power markets; and
Fuels, Transport, and Nature (“FTN”): renewable natural gas (RNG) plants, transportation fleet enhancements, and ecological restoration projects, among others, that increase resiliency or more efficiently use natural resources.
As part of our investment process, we intend to calculate the ratio of the estimated first year of metric tons of carbon emissions avoided (or that will be avoided) by the investment divided by the capital to be invested to understand the impact the investment is expected to have on climate change pursuant to HASI’s CarbonCount® methodology.
We intend to utilize the net proceeds of this offering to acquire or invest in, in whole or in part, Eligible Green Projects. Eligible Green Projects may include projects with disbursements made during the twelve months preceding the issue date of the Notes and projects with disbursements to be made following the issue date. Prior to the full investment of such net proceeds, we intend to invest such net proceeds in interest-bearing accounts and short-term, interest-bearing securities.
During the term of the Notes, until such time as the net proceeds from this offering have been fully allocated to Eligible Green Projects, we will publish annual updates on our website detailing, at a minimum, the allocation of the net proceeds from this offering to specific Eligible Green Projects along with the associated CarbonCount®.
3) ICMA’s Green Bond Principles are applicable to our corporate unsecured green bonds, exchangeable green notes
Corporate Green Bonds
| SECURITY NAME | INDEPENDENT VERIFIER | CUSIP | MATURITY DATE | ISSUED VOLUME | COUPON RATE | CONVERSION PREMIUM | BOND TYPE | RATINGS | CARBONCOUNT®4 |
|---|---|---|---|---|---|---|---|---|---|
| HASI-GRB-002 | Ernst and Young | 418751 AB9 | 4/15/2025 | $400,000,000 | 6.00% | N/A | Senior Unsecured | S&P: BB+ Moody's: Baa3 Fitch: BB+ Positive Outlook | 2.01 |
| HASI-GRB-003 | Ernst and Young | 418751 AD5 | 9/15/2030 | $375,000,000 | 3.75% | N/A | Senior Unsecured | S&P: BB+ Moody's: Baa3 Fitch: BB+ Positive Outlook | 0.35 |
| HASI-GRB-005 | Ernst and Young | 418751 AE3 | 6/15/2026 | $1,000,000,000 | 3.375% | N/A | Senior Unsecured | S&P: BB+ Moody's: Baa3 Fitch: BB+ Positive Outlook | 0.39 |
| HASI-GRB-006 | Ernst and Young | 418751 AG8 | 5/01/2025 | $200,000,000 | 0%5 | 32.5% | Exchangeable Note | - | 0.24 |
| HASI-GRB-007 | Ernst and Young (Likely) | 418851 AJ2 | 8/15/2028 | $402,500,000 | 3.75% | 25.0% | Exchangeable Note | Moody's: Baa3 | TBD |
| HASI-GRB-008 | Ernst and Young (Likely) | 418751 AL7 | 6/15/2027 | $750,000,000 | 8.00% | N/A | Senior Unsecured Note | S&P: BB+ Moody's: Baa3 Fitch: BB+ Positive Outlook | TBD |
Green CarbonCount® Commercial Paper
| SECURITY NAME | INDEPENDENT VERIFIER | MATURITY DATE | ISSUED VOLUME | DEBT TYPE | RATINGS6 | CARBONCOUNT®4 | AVOIDED EMISSIONS7 | RENEWABLE OR AVOIDED GENERATION7 | TECHNOLOGY | GEOGRAPHIC | MARKET |
|---|---|---|---|---|---|---|---|---|---|---|---|
| HASI-GCCP-001 | Ernst and Young | 3/10/2022 | $50,250,000 | Green Commercial Paper | S&P: A1 Moody's: P1 | 1.66 | 0 (2021) | 0 (2021) | Wind | National | GC |
CarbonCount®– Based Credit Facilities
| SECURITY NAME | INDEPENDENT VERIFIER | MATURITY DATE | ISSUED VOLUME | COUPON RATE | DEBT TYPE | RATINGS | CARBONCOUNT®8 |
|---|---|---|---|---|---|---|---|
| HASI-SLL-001 | Apex Companies, LLC | 4/12/2028 | $1,250,000,000 | Term SOFR + 1.825% | Unsecured Revolving Line of Credit | S&P: BB+ Moody's: Baa3 Fitch: BB+ Positive Outlook | 0.33 |
| HASI-SLL-002 | Apex Companies, LLC | 4/12/2027 | $250,000,000 | Term SOFR + 2.075% | Unsecured Term Loan A | S&P: BB+ Moody's: Baa3 Fitch: BB+ Positive Outlook | 0.33 |
4) This is the CarbonCount® metric resulting from the allocation of the net proceeds from this offering to specific Eligible Green Projects. CarbonCount® is the ratio of the estimated first year of metric tons of carbon emissions avoided (or that will be avoided) by the investment divided by the capital to be invested to understand the impact the investment is expected to have on climate change. In this calculation, we use emissions factor data, expressed on a CO2 equivalent basis, from the U.S. Government or the International Energy Administration to estimate a project’s energy production or savings to compute an estimate of metric tons of carbon emissions that will be avoided. In addition to carbon, we also consider other environmental attributes, such as water use reduction, stormwater remediation benefits, or stream restoration benefits
5) The 2025 Exchangeable Senior Notes accrete to a premium at maturity equal to 3.25%. The accreted balance at maturity is expected to be ~$220 million. Upon any exchange, holders will receive a number of shares of our common stock equal to the product of (1) the aggregate initial principal amount of the notes to be exchanged divided by $1,000 and (2) the applicable exchange rate.
6) Bank of America, N.A. (BofA) has issued a letter of credit of up to $125M as a credit enhancement to our green commercial paper program. As a result, no more than $125MM of green commercial paper will be outstanding at any point in time. The ratings above represent short-term debt ratings of BofA.
7) Avoided emissions and generation for 2021 are zero as the projects to which these proceeds were allocated were not placed in service until 2022.
8) Each CarbonCount® – Based credit facility provides for interest rate reductions if HASI achieves a certain level of its CarbonCount® metric on an annual basis. Metric represents HASI’s CarbonCount® reported in 2023.
Affiliations
HASI is a proud member of the Nasdaq Sustainable Bond Network. Copyright, Nasdaq 2021.
HASI’s notes meet the environmental eligibility criteria for green bonds as defined by the International Capital Market Association’s Green Bond Principles.