Fingrid to increase its use of green financing
Fingrid has established a Green Finance Framework and a Green Euro Commercial Paper Programme that enable the company to cover its debt financing entirely with green financing.
The new Green Finance Framework integrates Fingrid’s sustainable strategy, which enables Finland to reach its climate goals, further into the company’s financing activities. The short-term goal is to significantly increase the share of green financing in the company’s debt financing. Alongside the new framework, Fingrid has established a EUR 600 million Green Euro Commercial Paper Programme, which will allow the company to cover its short-term financing needs by issuing commercial paper with a maturity of up to one year. The company has used green financing to finance investment projects since 2017 (Green Bond). The new framework will expand Fingrid’s use of green financing to cover all its debt financing needs.
Fingrid has long been engaged in purposeful work to enhance Finland’s competitiveness and promote the green transition. Corporate responsibility is an essential aspect of Fingrid’s business and value-creation for society and its various operators. Climate change mitigation and Finland’s target of becoming carbon neutral by 2035 are the company’s key commitments to sustainable development. Fingrid uses green financing to develop and expand the main electricity grid, enabling the transition to a clean electricity system. The ten-year main grid development plan published in summer 2023 calls for investments of approximately EUR 4 billion.
“Finland is building one of the world’s cleanest energy systems, which will create opportunities for significant economic growth. This development requires investments and close cooperation. It will also present business opportunities for many different operators. Fingrid is enabling the growth of new green industries in Finland by developing the electricity market and further strengthening its reliable main grid to cater for clean electricity production and consumption. This development is also an excellent opportunity for Fingrid to make increasing use of green financing to fund its investments,” says Jukka Metsälä, Fingrid’s CFO.
ISS Corporate Solutions, a specialist in assessing green financing, provided an independent second party opinion confirming the alignment of the framework with the International Capital Markets Association (ICMA) 2021 Green Bond Principles and the Loan Market Association (LMA) 2023 Green Loan Principles. ING acted as the sole green structuring advisor on the Green Finance Framework and the arranger of the Green ECP Programme.
For more information on the Green Finance Framework, the Second Party Opinion, and the Green ECP Programme, visit Fingrid’s website at https://www.fingrid.fi/en/green-finance-framework
Jukka Metsälä, CFO, Fingrid Oyj, tel. +358 40 563 3756