UAE's Largest Renewable Energy Company Aims to Raise $750 Million Through Bond Sale

The largest renewable energy producer in the United Arab Emirates is planning to raise up to $750 million in its first-ever green bond sale to finance new solar, wind, and hydrogen projects globally.

‍Masdar is planning to sell bonds in the second half of the year, Chief Financial Officer Niall Hannigan said in an interview in Abu Dhabi. The firm is aiming to grow its renewables capacity five-fold by the end of the decade.‍

Hannigan said that the company is likely to issue bonds on an annual basis, given its growth ambitions and the pipeline of projects in place. He made the comments on the sidelines of Abu Dhabi Sustainability Week, the emirate's annual conference for renewables, water and climate change.

The new funds will help the government-owned company to continue to develop new projects at home, in Saudi Arabia, central Asia and other markets. It will also seek to combine solar and wind assets with green hydrogen projects in markets like Egypt and Oman and other areas with export and transport connections. It has a green capacity target of as much as 100 gigawatts by the end of the decade.

He said that the company is exploring hydrogen projects and that it is very early in the development of this sector.

This year, the UAE is hosting COP28, the UN's major annual climate change conference. One of its most important tasks is to get the world's biggest oil producers more involved in discussions on how to curb global warming. This is no easy task, but it's one that the UAE is committed to taking on.

The country was the first in the region to declare a target of net zero carbon emissions by 2050. The government-owned Abu Dhabi National Oil Co. is earmarking 10% of its $150 billion budget for low-carbon energy projects over the next five years, in addition to the Masdar green plans.

Hannigan said that Masdar will also look to mergers and acquisitions to help meet its ambitious growth target.

‍"M&A is obviously a significant part of our growth strategy," he said, adding that the US is "an increasingly attractive market."‍

‍The UAE is using its oil wealth to attract foreign investment to the country. By selling bonds in state-linked firms, the UAE has been able to raise the funds needed to diversify its economy away from reliance on oil sales.

The equity markets in Abu Dhabi, Dubai, and Saudi Arabia have been a bright spot for bankers over the past year as state companies have gone public in a Middle East boom.