The London Stock Exchange welcomed Anglian Water to the market on Tuesday at a market opening ceremony following the successful launch of its Green Bond – the first ever sterling bond from a UK utility.
Anglian Water successfully launched its £250 million Green Bond on Monday 31 July to finance a range of activities that support its ambitious Love Every Drop sustainability strategy. The bond will
mature in August 2025 with a coupon of 1.625%, and on launch the orderbook peaked at £800m with nearly 80 investors participating.
Long term access to secure water supplies is one of the most pressing global challenges today. Operating in one of the driest, yet fastest growing and economically important regions of the UK, Anglian Water is a sustainability leader and innovator in areas including reducing carbon, reducing leakage, encouraging water efficiency, long term water resource planning, and environmental stewardship.
The ceremony of opening the market and signing the official register dates back to 1875.
Aware of its responsibility, and of the major role it plays in the regional and UK economy, the water company has committed to a range of ambitious environmental goals, including pledging to become a carbon neutral business by 2050. Having already reduced embodied carbon by 55% from a 2010 baseline, it is on course to reach 60% carbon reduction by 2020.
Longer term, it has also pledged to enable sustainable economic and housing growth in the UK’s fastest growing region, make the East of England resilient to the risks of drought and flooding.
The sustainability focus at the heart of its business means all of Anglian Water’s capital expenditure qualifies as eligible expenditure for the Green Bond. However, the water company will select some of its largest, and stand out schemes to be included, such as innovative water abstraction, drought and flood resilience schemes, and progressive water recycling and water resource management projects.
Peter Simpson, Chief Executive for Anglian Water, said:
“This bond issue will enable us to address the three-fold challenges of water scarcity, climate change and environmental protection in the face of a growing population, but it also represents the pinnacle in responsible financing. As members of The Prince’s Trust, Accounting for Sustainability, we aim to lead the broader business community towards more resilient and sustainable business models, and as Business in the Community’s Responsible Business of the Year, we have pledged as part of our manifesto to encourage more companies to pursue green, responsible finance.
“For Anglian Water, sustainability is simply how we do business, all day, every day. But issuing the very first public utility sector green bond is a signal to others that amplifies our commitment in this area and demonstrates that debt financing and sustainable business principles go hand in hand.
“Our continuous drive to offer value for money for customers and deliver environmental benefits is made possible by investor confidence in our strong financial structure, governance and reporting. It’s this that made us automatically eligible for a Green Bond without needing to change any part of our processes and without incurring significant expense.”
Anglian Water’s green bond was launched with the support of BNP Paribas, HSBC, ING and JP Morgan.
Anglian Water CEO Peter Simpson with Catherine Bremner, Director of of the Department of Business, Energy and Industrial Strategy with the London Stock Exchange Market Opening plaque.