By Tessa Walsh

LONDON, March 31 (IFR) – Enel signed a € 1.35 billion sustainability guarantee facility with BBVA as the Italian utility continues to add instruments to its sustainability financing framework.

The sustainability guarantee facility is Enel’s largest to date and will support the company’s operations, including electricity and gas generation, transmission and distribution, and street lighting services. .

It promotes Enel’s sustainable agenda, because the guarantees that will be issued fall under the United Nations Sustainable Development Goal 7 for affordable and clean energy.

The guarantee facility is linked to Enel’s KPI target to increase its percentage of renewable energy, which the company uses for shorter-term instruments. Longer-term financing is linked to a KPI to reduce greenhouse gas emissions.

The Renewable Energy KPI applies to the years 2021 and 2022. If Enel achieves a target of 55% or more renewables in its energy mix in 2021 and 60% or more in 2022, BBVA will pay a bonus under of the guarantee facility. If Enel does not meet his goals, he will pay a penalty to BBVA.

Enel pioneered the sustainability-related format across multiple funding instruments and was the first company to develop a fully-fledged sustainability-related funding framework last year. The framework links instruments, such as sustainability-related bonds, loans, derivatives and commercial paper, to Enel’s KPIs and the sustainability performance targets used to calibrate them.

Enel also aims to increase its share of sustainable finance to 48% in 2023 and to more than 70% in 2030, and in early March signed a record 10 billion euros revolving credit facility linked to sustainable development with linked margins. direct greenhouse gas emissions.

The company plans to add other financing instruments to its framework this year, including factoring and trade finance loans, and is exploring supply chain finance.

Moody’s upgraded Enel’s long-term credit rating in January to Baa1 from Baa2, citing progress made in improving the group’s business risk profile through its investments in networks and renewables, its geographic diversification and its focus on centralized funding.

BBVA has mobilized 50 billion euros as part of its “Pledge 2025” commitment to provide 100 billion euros in green financing, sustainable infrastructure, social entrepreneurship and financial inclusion.

The bank has a sustainable transactional products framework that allows it to classify customer transactional banking (including confirmation and deposit facilities) as green, social, sustainable or related to sustainability. In 2020, BBVA signed 41 sustainable transactional banking facilities for a total of 1.57 billion euros.

(Reporting by Tessa Walsh; editing by Ian Edmondson)

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