World Bank’s IFC to Invest $75 Mn in AC Energy’s Green Bond

The proceeds from the AC Energy green bonds will be used to finance the company’s plans for up to 5GW of renewable energy projects in East Asia and Pacific.

IFC, a member of the World Bank Group, will invest $75 million in the first-ever listed green bond issued by AC Energy Finance International Limited and guaranteed by AC Energy, the power arm of Ayala Corporation.

IFC’s investment anchored a $300 million green bond, attracting interest from international and Philippine institutional and bank investors and opening up more financing for renewable energy projects in the Asia Pacific region. 

This is the first Climate Bond certified infrastructure-focused green bond to be publicly listed in Southeast Asia. The five-year green bond is listed on the Singapore Exchange. 

The proceeds from the AC Energy green bonds will be used to finance the company’s plans for up to 5GW of renewable energy projects in East Asia and Pacific to 2025, with IFC’s subscription dedicated to selected solar PV and wind projects in Vietnam. This builds on IFC’s investment in the power sector in Vietnam, particularly its equity stake in Gia Lai Electricity Joint Stock Company, the developer of the first operational utility-scale solar PV projects in the country. 

The investment will also support AC Energy’s strategy to transform the company into a regional player focused on renewable energy, beyond its home market in the Philippines.

Vivek Pathak, IFC Director for East Asia and the Pacific, said, “This partnership, leveraging IFC’s extensive global experience in green bonds, demonstrates the tremendous potential of the green bond asset class as a tool for mobilizing international institutional capital into infrastructure assets.” He added, “We look forward to expanding our support of such issuances across Asia, advancing the integration of regional power and financial markets.” 

Recently, the Asian Development Bank (ADB) also invested $20 million in the maiden climate bond issuance of AC Energy.

“This climate bond will help the Association of Southeast Asian Nations meet its target of drawing 23% of the region’s energy mix from modern, clean, and sustainable renewable sources by 2025,” said Michael Barrow, Director General of ADB’s Private Sector Operations Department. “AC Energy aspires to be a regional leader in renewable energy, and ADB is delighted to support the Ayala Group in this effort by anchoring this investment and crowding in other institutional investors.”