by BLOOMBERG / pic by BLOOMBERG
JAKARTA • A power company sold Indonesia’s first green corporate bond with an investment-grade rating as the country extends its lead over Asean neighbours in issuing debt to support the environment.
The US$1.1 billion (RM4.58 billion) bond sale from Star Energy Geothermal (Salak-Darajat) BV pushes Indonesia past Singapore to make it the biggest issuer of such debt, across all currencies, in SouthEast Asia this year.
Indonesia’s government returned to the green bond market for a third time in June after first issuing in 2018, helping to set more benchmarks for other borrowers. The market is still relatively small, with just a handful of issuers.
Star Energy will use some of the proceeds from the issuance to fund its geothermal operations.
It’s the third green bond offering from the group, Barito Pacific’s president director Agus Salim Pangestu said in a text message on Monday.
While units PT Royal Lestari Utama and Star Energy Geothermal (Wayang Windu) Ltd previously sold the securities, their ratings were non-investment grade, according to Pangestu.
Indonesia has not yet witnessed major growth of solar and wind generation capacity, said Fitch Ratings Inc’s Muralidharan Ramakrishnan.