Goldman Sachs is arranging a JPY 8.7 billion (63.5 million) green bond to support the construction of around 700 solar plants on disused farmland across Japan by Clean Energy Connect (CEC), the renewable energy unit of Japanese trading company Itochu.
The solar facilities will sell power to NTT Anode Energy, a unit of Nippon Telegraph and Telephone Corp. (NTT), under a 30-year PPA.
“While 30 years is a long horizon, the vast majority of investors said they felt comfortable because of the issuer’s exceptionally strong credit ratings, ” a Goldman Sachs spokesperson told pv magazine.
This is the first time that a green bond linked to a solar PPA has been issued in Japan.
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Under current Japanese regulations, corporate PPAs must involve electric utilities, except for on-site PPAs. Both physical and virtual PPAs are allowed. Under physical PPAs, electricity buyers pay fixed fees to generators through retailers, including “sleeving” and management fees.
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