ADB Supports Thailand's First Sustainability Bond to Boost Renewable Energy and Access

This bond issuance marks a significant step towards building a robust and sustainable bond market in Thailand and demonstrates PEA’s dedication to environmental and social governance in its operations.

The Asian Development Bank (ADB) is assisting Thailand's Provincial Electric Authority (PEA) in launching its first sustainability bond, which will raise 1 billion baht (approximately $35 million). Scheduled for issuance on 21 August, this bond represents a major milestone in the development of Thailand’s sustainable finance market.

The five-year bond will be sold to Thai institutional investors and is designed to fund various sustainability projects. The proceeds will support PEA's initiatives to advance renewable energy projects, such as microgrid development, and enhance climate resilience through initiatives like submarine cables to remote islands. Additionally, the funds will be used to improve energy access in underserved areas, thereby raising the quality of life for beneficiaries.

ADB’s support for this bond highlights its commitment to fostering ESG-driven capital market developments. Anouj Mehta, ADB Country Director for Thailand, emphasized the significance of this transaction: “This transaction affirms ADB's commitment to supporting pioneering, ESG-driven capital market issuances by state-owned enterprises and private corporations that align with the ASEAN Taxonomy for Sustainable Finance. PEA is showcasing the critical role utility operators play in the country’s decarbonization efforts, given the energy sector's impact on Thailand’s greenhouse gas emissions.”

PEA’s sustainability goals include achieving carbon neutrality by 2037, a target set 13 years ahead of the national goal, and reaching net-zero emissions by 2065, aligning with the Government of Thailand’s policy. Supachai Ek-Un, PEA Governor, noted: “PEA will issue sustainability bonds and promote both green and social finance. In collaboration with ADB, we have developed a sustainable finance framework that adheres to international and regional standards to build investor confidence and align with the Sustainable Development Goals.”

ADB’s technical assistance for this bond is provided through the Green, Social, Sustainable and Other Labeled (GSS+) Bonds Initiative for Southeast Asia, part of a collaboration between the Asian Bond Markets Initiative (ABMI) and the ASEAN Catalytic Green Finance Facility (ACGF). The ABMI, supported by ASEAN governments and other regional partners, aims to develop local currency bond markets. The ACGF, an initiative of the ASEAN Infrastructure Fund, accelerates green infrastructure investments in Southeast Asia.

This bond issuance marks a significant step towards building a robust and sustainable bond market in Thailand and demonstrates PEA’s dedication to environmental and social governance in its operations.