A green bond is a type of fixed-income instrument that is specifically earmarked to raise money for climate and environmental projects. These bonds are typically asset-linked and backed by the issuing entity's balance sheet, so they usually carry the same credit rating as their issuers’ other debt obligations.
MILLIONS OF INVESTORS have embraced socially responsible investing, preferring to put their money into stocks of firms that don't sell weapons, alcohol or tobacco. But few investors are as familiar with a kind of second cousin: green bonds.
Like all bonds, green ones are loans from investors to issuers, with interest paid to bond owners for a given period before the principal is repaid. But green bonds are used to raise money for projects deemed good for the environment, like cleaning up pollution, supporting agricultural or forestry projects, or countering the effects of climate change.
Issuance of green bonds has soared alongside concerns about climate change, from about $800 million in 2007 to about $150 billion in 2017, according to Van Eck Securities Corp., which offers an exchange-traded fund, VanEck Vectors Green Fund (ticker: GRNB) composed of green bonds.
The first green bonds were issued by development banks and international agencies, but eventually that evolved into including private companies and local governments. In 2019, green bonds were issued by 506 entities. The top three issuing countries in 2019 were the U.S. ($51.3bn), China ($31.3bn), and France ($30.1bn).
How does one buy a green bond? Probably the easiest way — and one in which you can further spread your risk — is to buy into one of many green bond mutual funds. These are investments that pool multiple green bond offerings from around the world. For example, the Calvert Green Bond Fund had 166 holdings as of 10/31/2020. The largest holding — at 3.8% of the portfolio – is a 1.75% interest rate bond issued by France.
The green bond market is expected to continue growing robustly. In a recent interview with Bloomberg TV, Frans Timmermans, executive vice-president of the European Commission, said that rising demand for green bonds may create a $266 billion opportunity for the EU. He added:
“If you see organizations like BlackRock BLK +1.8% making this really enormous change into the green economy, if you see them all waiting for us to come up with green bonds because they want to be part of this — I believe this is the moment to do this.”
FUNDING METHODS and TIMELINES
The entire project of VETERANS NATIONAL CENTER & TECHNOLOGY EDUCATIONAL INSTITUTE is focused on greet energy. From the 100 MW HYDROGEN PLANT with full battery storage, DER and EMS, utilizing hydrogen powered microgrid and nanogrids with Hydrogen fuel cells for heating and air in all building on the campus. This is extremely important to our funding since we are using Green Bonds Funding as one of our main sources of funds.
Funding for the project is a combination of GREEN BOND $800,000,000.00, Corporate Sales of major products, Opportunity Revenue Partnerships bases on separate LLCs for various programs and technologies on that campus, Government Contracts, Private Equity, In-Kind Corporate Support, Naming Rights, Real Estate Sales and Corporate Diversity Funds, Endowments and Grants as well as from 15% Supporting Funds from the revenue of sales, projects, programs and contracts of Honor Valor Courage Corporation. Also, the cost is off set by the corporate IN-KIND programs as well as Naming rights on sections of the project.
The time frames are critical to the executions of funding methods. All building are built in modular design by Modular Direct in their factories which will cut our time to delivery by fifty percent over stick built. Architects and over 100 technology partners and vendors have been notified and are working on this project. All systems are installed at the factory allowing concurrent operations with manufacturing. The trenching and excavation takes place simultaneously as the building construction. Evaluation of addition partners and in-kind support companies is underway in all areas.
The time line for opening is two years from ground breaking scheduled for 2021 fall. It is critical that this project is turnkey, meaning all doors open at the same time no phase build out.
VETERANS NATIONAL CENTER
TECHNOLOGY EDUCATIONAL INSTITUTE