Infrastructure investor Kommunalkredit Austria has announced the issuance of a €200 million bond aimed at accelerating the green energy transition in Central and Eastern Europe (CEE) and Turkey. The bond is backed by investments from the International Finance Corporation (IFC) and the Asian Infrastructure Investment Bank (AIIB), each committing up to €100 million.
The proceeds from the bond will be directed towards renewable energy projects, with a particular focus on wind power, as part of the broader decarbonisation efforts in the region. This initiative is designed to address the energy transition challenges faced by countries such as Bulgaria, Poland, and Romania, where renewable energy currently represents just 14-19% of total energy consumption—well below the EU's targets.
Kommunalkredit, which has long been a partner for supranational institutions in financing large-scale infrastructure projects, will work alongside IFC and AIIB, both of which are committed to supporting green projects in the CEE region. This collaboration aligns with the European Green Deal's goal to reduce greenhouse gas emissions by 55% by 2030 and achieve climate neutrality by 2050.
“With our passion for sustainable infrastructure projects, we have perfectly aligned missions with IFC and AIIB to drive green transition and private sector investments in emerging markets,” said Sebastian Firlinger, Acting CEO of Kommunalkredit. “We are honoured to collaborate with supranational organizations in a field where we share a common vision for sustainable development. This transaction marks the first step in what we hope will be a long-term partnership between Kommunalkredit, IFC, and AIIB.”
The bond issuance is seen as a crucial step towards bolstering the resilience of the power sector in Bulgaria, Poland, and Romania, while diversifying the energy mix. IFC's focus on financing wind projects in these countries aims to address both the urgent need for renewable energy development and the region's commitment to decarbonisation.
Gregory Liu, Director General of the Global Financial Institutions and Funds Department at AIIB, stated, “Together, we are working towards a shared vision of sustainable infrastructure that meets the needs of the future and addresses climate challenges in this vital region.
Vittorio Di Bello, IFC Regional Director for the Financial Institutions Group in Europe, Latin America, and the Caribbean, added, “Our investment in Kommunalkredit's bond will channel critical funding into sustainable energy projects in Bulgaria, Poland, and Romania.
