Cabinet plans bond issue to repay debt to green energy producers
21 January 2021
Ukrainian PM Denys
Shmyhal ordered the energy, finance and economy ministries to consider an issue
of state bonds in order to raise funds for the repayment of arrears to
renewable energy producers, the epravda.com.ua news site reported on Jan. 20.
He called the possible issue “green bonds.”
Recall, last year,
the state operator of the wholesale market Guaranteed Buyer, whose
responsibility is to purchase electricity from renewable energy sources, accumulated
swelling arrears to green producers. Namely, Guaranteed Buyer paid just UAH 2.8
bln for the green electricity it purchased in March-July at a total amount of
UAH 24.6 bln.
Alexander
Paraschiy: Ukraine’s
2021 state budget does not explicitly foresee an issue of any state debt to
repay the accumulated green energy arrears, so it is not clear on what basis the
government is going to issue its “green bonds”.
Nevertheless, such
an issue is possible, and in case it’s done, it will significantly improve the
liquidity of green energy producers, including DTEK Renewables (DTEREN). This
supports our view that DTEREN bonds, yielding currently 10.4% to their maturity
in 2024, are the most attractive instrument in Ukraine’s fixed income universe.
