Bangkok: The Ministry of Finance has announced its support for the Electricity Generating Authority of Thailand (EGAT) as it embarks on its inaugural issuance of Sustainability-Linked Bonds (SLB) valued at 2 billion baht, with an interest rate pegged at 1.40% per annum.

According to Thai News Agency, Ms. Chananporn Pisitwanich, Deputy Director-General of the Public Debt Management Office (PDMO), disclosed that the PDMO has facilitated a loan to EGAT for the issuance of the 5-year SLB 2025 (EGAT309B). This bond issuance, not guaranteed by the Ministry of Finance, is targeted at institutional investors. The bonds are structured under the Sustainability-Linked Finance Framework, with advisory support from the Asian Development Bank (ADB) and external review by DNV (Thailand) Co., Ltd., ensuring compliance with the ICMA Sustainability-Linked Bond Principles and the ASEAN Sustainability-Linked Bond Standards.

The underwriting for this bond issuance is managed by Bank of Ayudhya Public Company Limited. EGAT has committed to sustainability indicators, aiming to cut down Scope 1 and Scope 2 greenhouse gas emissions per unit of electricity production by a minimum of 30% by 2030. This target translates to achieving emissions of 0.3877 tons of carbon dioxide equivalent per megawatt hour, using 2021 as a reference year.

EGAT’s venture into SLB issuance positions it as the first state enterprise in Thailand to undertake such an initiative, garnering significant interest from investors including financial institutions, life insurance companies, and mutual fund management companies. The total offering amount reached 6.576 billion baht, surpassing the issued amount by 3.29 times, as indicated by the Bid Coverage Ratio (BCR). The National Broadcasting and Telecommunications Commission (NBTC) is optimistic that EGAT’s successful SLB issuance will serve as a benchmark for other state enterprises, promoting sustainable economic, social, and environmental advancements in the future.