USD 13.8 MM subscription in the USD 80 MM 5-year secured green bond (the "Bond"), to be listed on the Georgian Stock Exchange, issued by JSC Georgian Renewable Power Operations ("GRPO"), one of the leading renewable energy platforms in Georgia, which is 100% indirectly owned by JSC Georgia Capital, ("GCAP"), a holding company of a diversified group of businesses operating in healthcare, insurance, beverages, power & utilities and real estate in Georgia.
The project is the first green bond to be issued on the Georgian Stock Exchange.
The Bond proceeds will be applied to refinancing the shareholder loan provided by GCAP for redemption of JSC Georgia Global Utilities' USD 250,000,000.00 7.75% Eurobond, which took place in September 2022.
ETI score: 61
The Transition Impact arises from the Green and Resilient qualities:
Green: The expected transition impact is derived from introducing a capital market instrument that is novel on the Georgian market - a green bond with an independent third party verification.
Resilient: The Bond is the first corporate issuance of an instrument of this size on the local capital market.
GEORGIAN RENEWABLE POWER OPERATIONS JSC
GRPO is one of the leading renewable energy platforms in Georgia. The company operates four hydro power plants and the only wind power plant in Georgia with combined capacity of 71 Megawatts.
GRPO is 100% indirectly owned by GCAP, a holding company of diversified group of businesses operating in healthcare, insurance, beverages, power & utilities and real estate in Georgia.
EBRD Finance Summary
Total Project Cost
The Bank's additionality derives from supporting the Company's access to the local capital markets in the context of uncertain market conditions.
The transaction is Gender Additional through GRPO's planned implementation of an outreach campaign to raise awareness of the importance of women's participation in the energy sector.
Environmental and Social Summary
Categorised B (2019 ESP). As the project is a capital market transaction, Environmental and Social Due Diligence was carried out by review of publically available information, including the Green Bond Principals (GBP) Second Party Opinion (SPO), and disclosures made by the Issuer within MNPI rules. This approach is aligned with the EBRD's ESP and procedures for Capital Markets Transactions. Much of the ESDD had been completed under previous projects associated with the Issuer's underlying operational asset base and sufficient E&S information was available to EBRD to complete ESDD for the proposed transaction.
The Issuer's Green Bond Framework was subject to independent review and the resulting report confirms that the Framework is aligned with the Green Bond Principles, 2018. Furthermore, the report confirms that the categories for investment of Bond proceeds would advance the UN Sustainable Development Goals, specifically SDG 7. The Issuer will report the allocation of proceeds on its website on an annual basis until full allocation. The allocation reporting will include the total amount of proceeds allocated, the share of new financing and refinancing, the number of projects and level of certification, and the balance of unallocated proceeds. In addition, the Issuer plans to report on relevant ESG impact metrics which is aligned with good international practice.
The Issuer's asset base is known to EBRD and all of the sub-projects were structured to meet EBRD's requirements; Mestiachala 2 and Kasleti 2 HPPs are located in Svaneti region which presents a number of social sensitivities, however, both assets have been operational for some time and no new impacts will occur as a result of this transaction; Akhmeta HPP and Qartli WPP are considered to be examples of good international practice in the HPP and WPP sectors and reporting and supervision of these projects has been good; and Debeda HPP is a small run-of-river HPP that has been in operation since 2015 and no new issues associated with this facility are anticipated as a result of this transaction. EBRD will continue to monitor the operating performance of the assets as part of this Bond participation.
Technical Cooperation and Grant Financing
Company Contact Information
Medea Jugeli Street #10, 0179, Tbilisi, Georgia
PSD last updated
20 Oct 2022
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