Duke Energy Florida issues $700 million green bond to fund renewable energy investments
Duke Energy Florida completes two financings totaling $900m. Photo: courtesy of Duke Energy Corporation.
Duke Energy Florida, a subsidiary of Duke Energy (NYSE: DUK), completed two debt issuances today, aligned with the company’s focus on generating cleaner energy and advancing diversity and inclusion.
The first transaction, totaling $700 million, marks Duke Energy Florida’s inaugural green bond, which will finance eligible green energy projects, including the development, construction and procurement of solar generation and utility-scale battery storage projects in the state.
This transaction marks the third green bond issued by a Duke Energy utility in the past 12 months – and brings Duke Energy’s total clean energy offerings to $2.3 billion. Duke Energy Carolinas issued a $1 billion green bond in November 2018 and Duke Energy Progress issued a $600 million green bond in March 2019.
Duke Energy Florida’s second transaction, totaling $200 million, was led by PNC Bank and five diversity-owned financial institutions, further demonstrating Duke Energy’s pledge to elevate diversity and inclusion. Each of the firms served as an active bookrunner. The firms included CastleOak Securities, C.L. King & Associates, Drexel Hamilton, Great Pacific Securities and Ramirez & Co. – representing African American-owned, women-owned, Hispanic-owned and disabled veteran-owned institutions.
The funds from this bond will be used to cover costs associated with Hurricane Dorian, as well as other general corporate purposes.
“These transactions demonstrate Duke Energy is investing in more than just energy infrastructure. By offering green and diversity-led bonds, we are investing in the future of Florida,” said Duke Energy Florida state president Catherine Stempien. “We are generating cleaner energy for our customers and communities – and the green bond helps us fund these important projects as we advance our carbon-reduction goals.
As a company, we’re enhancing diversity and inclusion, with our commitment extending beyond the walls of Duke Energy. Increasing diversity is the right thing to do – and we are taking deliberate actions to increase our work with diverse suppliers, financial advisors, investors and more.”
Sam Ramirez, president of Hispanic-owned Ramirez & Co., said his company was pleased to be a part of today’s transaction. Ramirez & Co. has operations in Florida.
“The partnership on this transaction is a testament to Duke Energy’s commitment to diversity and inclusion. We were proud to have a meaningful role in the deal and it demonstrates that Duke Energy understands the importance of involving institutions like ours. It allowed different kinds of diversity-owned firms help Duke Energy Florida broaden its investor base and access low-cost capital on behalf of its customers,” said Ramirez.
Duke Energy has outlined a comprehensive strategy to reduce carbon emissions by more than 50 percent by 2030, and is striving to attain net-zero carbon emissions by 2050. Duke Energy Florida plans to install or acquire more than 700 megawatts of solar energy through 2022. To date, approximately 345 megawatts have been installed or are currently under construction to benefit customers.
The $700 million green bond was priced at a fixed-rate coupon of 2.50% and has a 10-year maturity. The $200-million diversity-led transaction has a two-year maturity and a floating rate pricing structure, with initial pricing set at approximately 2.17%.
The company priced the bonds on Nov. 21 and closed the transaction earlier today.
Source: Company Press Release