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 $10 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
Sustainable Yield Bonds
Non-recourse, asset-backed debt
Corporate Green Bonds
Senior unsecured or convertible bonds issued as corporate obligations
Other Green Debt
Syndicate Sustainability Linked Unsecured Revolving Line of Credit, Term Loan A and Green Carbon Count Commercial Paper Program
1) From IPO through 9/30/23, including the $165mm Term Loan Facility upsizing in October 2023
2) Represents total commitments of our Sustainability Linked Unsecured RLOC, Sustainability Linked 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”): Projects that deploy cleaner energy sources, such as solar and wind to generate power where the off-taker or counterparty is part of the wholesale electric power grid; and
Fuels, Transport & Nature (“FTN”): Projects that decarbonize high-emitting economic sectors beyond electricity use, including renewable natural gas (RNG) plants, transportation fleet enhancements, and ecological restoration projects, among others.
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.
We intend to utilize the net proceeds of this offering to acquire or refinance, 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 which are consistent with our intention to qualify for taxation as a REIT.
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®, which metric we will verify annually with an independent auditor to ensure its accuracy. In addition, we commit to reporting the avoided emissions, renewable or avoided generation, technology type, geography, and market of each offering.
3) ICMA’s Green Bond Principles applicable to corporate unsecured green bonds and convertible green bonds due 2023 but not necessarily to convertible green bonds due 2022
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+ Fitch: BB+ | 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+ Fitch: BB+ | 0.35 |
| HASI-GRB-004 | Ernst and Young | 41068X AD2 | 8/15/2023 | $143,750,000 | 0.00% | 27.5% | Convertible Senior Unsecured | S&P: BB+ Fitch: BB+ | 0.29 |
| HASI-GRB-005 | Ernst and Young | 418751 AE3 | 6/15/2026 | $1,000,000,000 | 3.375% | N/A | Senior Unsecured | S&P: BB+ Fitch: BB+ | 0.39 |
| HASI-GRB-006 | Ernst and Young | 418751 AG8 | 5/01/2025 | $200,000,000 | 0%5 | 32.5% | Exchangeable Note | - | 0.24 |
| SECURITY NAME | INDEPENDENT VERIFIER | CUSIP | MATURITY DATE | ISSUED VOLUME | COUPON RATE | CONVERSION PREMIUM | BOND TYPE | RATINGS | CARBONCOUNT®2 |
|---|---|---|---|---|---|---|---|---|---|
| HASI-GRB-002 | Ernst and Young | 418751 AB9 | 4/15/2025 | $400,000,000 | 6.00% | N/A | Senior Unsecured | S&P: BB+ Fitch: BB+ | 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+ Fitch: BB+ | 0.35 |
| HASI-GRB-004 | Ernst and Young | 41068X AD2 | 8/15/2023 | $143,750,000 | 0.00% | 27.5% | Convertible Senior Unsecured | S&P: BB+ Fitch: BB+ | 0.29 |
| HASI-GRB-005 | Ernst and Young | 418751 AE3 | 6/15/2026 | $1,000,000,000 | 3.375% | N/A | Senior Unsecured | S&P: BB+ Fitch: BB+ | 0.39 |
| HASI-GRB-006 | Ernst and Young | 418751 AG8 | 5/01/2025 | $200,000,000 | 0%5 | 32.5% | Exchangeable Note | - | 0.24 |
Green CarbonCount® Commercial Paper
| SECURITY NAME | INDEPENDENT VERIFIER | MATURITY DATE | ISSUED VOLUME | DEBT TYPE | CARBONCOUNT®5 | AVOIDED EMISSIONS6 | RENEWABLE OR AVOIDED GENERATION6 | TECHNOLOGY | GEOGRAPHIC | MARKET |
|---|---|---|---|---|---|---|---|---|---|---|
| HASI-GCCP-001 | Ernst and Young | 3/10/2022 | $50,250,000 | Green Commercial Paper | 1.66 | 0 (2021) | 0 (2021) | Wind | National | GC |
| SECURITY NAME | INDEPENDENT VERIFIER | MATURITY DATE | ISSUED VOLUME | DEBT TYPE | CARBONCOUNT®3 | AVOIDED EMISSIONS4 | RENEWABLE OR AVOIDED GENERATION4 | TECHNOLOGY | GEOGRAPHIC | MARKET |
|---|---|---|---|---|---|---|---|---|---|---|
| HASI-GCCP-001 | Ernst and Young | 3/10/2022 | $50,250,000 | Green Commercial Paper | 1.66 | 0 (2021) | 0 (2021) | Wind | National | GC |
4) The 2025 Exchangeable Senior Notes accrete to a premium at maturity equal to 3.25%. The accreted balance as of December 31, 2022 is $205 million. Upon any exchange, holders will receive a number of shares of our common stock based 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.
5) 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.
6) Avoided emissions and generation for 2021 are zero as the projects to which these proceeds were allocated were not placed in service until 2022.
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.