BNP Paribas Closes Sustainability Linked RCF With Brookfield Renewables

BNP Paribas has closed an incentive-linked corporate revolving credit facility with Brookfield Renewable Partners to expand its renewable portfolio

BNP Paribas, a premier global banking partner, has announced that it has closed a bi-lateral, incentive-linked corporate revolving credit facility (RCF) with Brookfield Renewable Partners, structured as a sustainability-linked loan (SLL). One of the first SLLs offered in Canada and the first for BNP Paribas in Canada.

SLLs typically incorporate a pricing mechanism linked to a client’s environmental, social or governance (ESG) performance. The key feature of this RCF structure is a pricing incentive whereby Brookfield Renewable Partners’ cost of debt declines as it continues to expand its renewable and clean electricity generating capacity and meets pre-determined CO2 emissions avoidance levels. This alignment ultimately reflects the vision of placing sustainability at the core of its business strategy. 

Brookfield Renewable Partners operates one of the world’s largest publicly-traded renewable power platforms. In 2018, its portfolio helped to avoid 25 million tons of CO2 equivalent emissions. The portfolio consists of hydroelectric, wind, solar and storage facilities in North America, South America, Europe and Asia, and totals over 18,000 megawatts of installed capacity and an 8,000-megawatt development pipeline.

“BNP Paribas’s sustainability-linked loan aligns well with our goal of expanding our renewable power portfolio as we continue to play a leading role in the decarbonisation of the global power generation grid,” said Julian Deschâtelets, managing director at Brookfield Renewable, responsible for the capital markets and treasury function globally. “We also see this facility as a complement to issuances under our Green Bond framework.”

In 2011, the bank had decided to place the fight against climate change at the forefront of its priorities. The Bank financed more than EUR 15 billion in renewable energy in 2018 and is among the top 3 issuers of green bonds in euros. At the end of 2018, the total financing provided by BNP Paribas that contributed to the energy transition and the SDGs was EUR 168 billion.

Sonja Volpe, principal officer and CEO BNP Paribas in Canada, said that “we are delighted to be helping Brookfield Renewable Partners, one of the world’s largest investors in renewable power, to build on its leadership position in renewables. The sustainability lending space has grown rapidly worldwide, and BNP Paribas is proud to be a leader in renewable energy financing, and Sustainable Finance more broadly.”

PC: Ørsted