EBRD Invests In A Baltic First
Acting as an anchor investor, the European Bank for Reconstruction and Development (EBRD) has backed the issuance of a €75 million sustainability-linked bond by Lithuania’s state-owned energy transmission system and exchange group EPSO-G.
Photo Insert: The EBRD is investing €22.5 million in the first such bond issued by a Baltic company, which will help Lithuania diversify its energy supplies.
The EBRD is investing €22.5 million in the first such bond issued by a Baltic company, which will help Lithuania diversify its energy supplies.
“The EBRD is proud to contribute to the successful placement of the EPSO-G bond in this volatile and challenging market environment. EPSO-G’s debut sustainability-linked bond is consistent with Lithuania’s climate commitments and energy security ambitions by facilitating the integration of Lithuania’s electricity grid with the EU network. It therefore represents a top priority for the EBRD,” said Grzegorz Zielinski, EBRD Director and Head of Energy Europe.
The EBRD's key priorities in Lithuania are energy security and efficiency. To date, the Bank has invested over €1.15 billion in 111 projects across the Lithuanian economy.
Lithuania is a net importer of electricity, relying heavily on interconnection with neighboring countries to meet its energy requirements. It is currently a member of the BRELL electricity ring, which includes the three Baltic countries, Russia, and Belarus, but it hopes to fully integrate its electricity grid with the EU network by 2025.
The sustainability-linked bond will be listed on the Nasdaq Baltic exchange, which is a European Union-regulated platform and a member of the Sustainable Stock Exchanges Initiative, which aims to improve corporate transparency on environmental, social, and corporate governance (ESG) issues.
Algirdas Juozaponis, acting CEO of EPSO-G added that “The issuance of sustainability-linked bonds will have direct impact strengthening Lithuanian energy independence and will make a significant contribution to achieving sustainability objectives: to reduce carbon footprint, ensure the stability of the transmission grid and foster a transition toward climate-neutral energy."
EPSO-G is not only the first Baltic company to issue a sustainability-linked bond, but it is also the first time the company has approached the capital market for funding.
EPSO-G will be able to diversify its funding basis and continue investments in energy grid synchronization with continental Europe, which are partially sponsored by the European Union, to ensure improved supply security, thanks to the successful placement of its €75 million issue.