Masdar, the largest generator of renewable energy in the UAE intends to raise up to $750M in its first-ever green bond offering in order to finance new solar energy and hydrogen projects throughout the world. According to Masdar’s Chief Financial Officer, Niall Hannigan, the bonds would probably be sold in the second half of the year. By the end of the decade, the company wants to increase its renewable energy capacity by five times.
“Given the growth ambitions we have as a business and the pipeline we have in place, I would be expecting that we’re likely to be an annual issuer,” Hannigan said on the sidelines of Abu Dhabi Sustainability Week, the emirate’s annual conference for renewables, water, and climate change, according to Gulf News. The additional cash will assist the state-owned business in continuing to create new projects in its own country as well as in Saudi Arabia, central Asia, and other regions. In markets like Egypt and Oman and other regions with export and transportation ties, it will also try to combine solar and wind assets with green hydrogen initiatives. By the end of the decade, it aims to have 100 gigawatts of green capacity.
“We’re exploring,” he said of the company’s efforts to develop hydrogen projects. “It’s a very nascent sector and it is very early days for a lot of this.” This year, the UAE is hosting COP28, the UN’s major annual climate change conference. The UAE was also the first in the region to declare a target of net zero carbon emissions by 2050. ADNOC is earmarking 10% of its $150B budget for low-carbon energy projects over the next five years, in addition to Masdar’s green plans.
Masdar will also look to mergers and acquisitions to help meet its ambitious growth target, Hannigan said. “M&A is obviously and should be a significant part of our growth strategy,” he said, adding that the US is “an increasingly attractive market.” The money needed to wean the UAE’s economy further from dependence on oil sales has been raised through the sale of bonds in state-affiliated businesses. As state enterprises went public in a Middle East boom, equity markets in Abu Dhabi, Dubai, the business capital of the UAE, and neighbouring Saudi Arabia have been one bright spot for bankers over the last year.
