Santander Bank Polska is the coordinator, lead arranger and bookrunner of the first sustainability-linked bond issue for TAURON Polska Energia S.A. worth PLN 1 bn. The funds from the transaction will be used, among others, to increase the share of zero-emission energy sources in the generation structure of TAURON Group.
The issue executed for TAURON Polska Energia S.A. will be the first issue of sustainability-linked bonds in Poland and the largest bond issue in the corporate sector since the introduction in Poland of the lockdown caused by the coronavirus pandemic. The funds from the issue will support the transformation of the TAURON Group and will be used to finance the costs of construction/acquisition of projects involving renewable energy sources, to finance distribution and general corporate activities of the Issuer's Group related to RES or the transformation towards zero emissions, as well as to refinance the debt incurred by the Issuer's Group to finance the above projects.
Notably, the funds raised from the bonds will not be available for financing new and existing coal units, activities of Tauron Wydobycie S.A. and Tauron Wytwarzanie S.A. (in case of undertakings other than those mentioned in the paragraph above). Moreover, the above objectives were additionally supported by the introduction of specific sustainable development indicators to the bond issue terms and conditions and making the interest margin conditional on their achievement.
'Today it is difficult to imagine sustainable development without sustainable finance. That is why Santander Bank Polska is deeply involved in the processes supporting and shaping the green transformation of enterprises , which resulted, among other things, in the decision to withdraw from financing coal-based investments. At the same time, we are a partner of changes in business by offering companies, as the first bank in Poland, financing related to the implementation of Sustainable Development Goals. This form of financing defines modern business, bringing benefits to the environment.,' comments Aleksander Piniński, Corporate and Investment Banking Director at Santander Bank Polska.
'The funds obtained from the bonds will be one of the driving forces behind TAURON's Green Turnaround. We are primarily interested in increasing the share of renewable energy sources in our generation structure and quickly reducing CO2 emissions. Our plan is to cut emissions by more than 50 percent by 2030. The bond issue is another step in building a diversified financing of the Group's non-carbon activities,' says Wojciech Ignacok, President of the Management Board of TAURON Polska Energia S.A.
The TAURON Group, together with the issue coordinator, has defined the following indicators: CO2 emission reduction rate (2% per year on average) and RES capacity increase rate (8% per year on average). If these indicators are not met, the base margin will be increased in accordance with the provisions of the issue terms and conditions. Every year an independent auditor will certify the correctness of the calculations of the sustainable development indicators.
'Issuance of green bonds, ESG-linked loan agreements and finally sustainability-linked bonds are solutions that we successfully launched on the market as the first bank in Poland. We are glad that we can support our customers' ambitious goals with such solutions,' comments Kamil Witkowski, Manager DCM Santander Bank Polska.
One of the pillars of Santander Bank Polska's Responsible Banking strategy is sustainable financing, understood, among others, as the development of products based on Sustainable Development Goals or ESG indicators and contributing in this way to the increase of the RES share in our energy system. The issue of sustainability-linked bonds by TAURON Polska Energia S.A. is another transaction that fits into the implementation of these objectives. This year alone, Santander Bank Polska co-financed the largest contract in Poland worth PLN 350 million for the construction of photovoltaic farms, with a total capacity of 121 MWp. This will enable the launch of 128 solar power plants in Poland within the next 2 years. The bank has also financed a 121 MW wind farm construction project for Poland's leading producer of green energy, and recently provided funding of PLN 165.4 million to deliver 50 zero-emission buses to the Municipal Transport Company in Krakow.