By Arman Kazemi
February 4, 2015
The online clean investment platform CoPower has just released its first Canadian green bond to individual investors.
CoPower’s Green Bond I is accessible for a minimum investment of $5,000, with five per cent annual returns for five years.
CoPower lends the capital to development partners specializing in solar and energy efficiency systems, who in turn pay back the loans based on revenue generated.
While the World Bank established green bonds in 2008, the instrument only took off in Canada in 2014, when these fixed income securities went from zero to $1.4 billion by the end of the year, mainly thanks to large issuers like TD Bank and the province of Ontario.
Traditionally, Canadian green bonds have been geared toward institutional investors, because of higher entry thresholds.
With CoPower’s Green Bond I, according to a news release, “average Canadians can also earn financial returns while helping to build green communities.”
he capital raised through green bonds is dedicated to projects with a specifically environmental outcome, from transport efficiency and green infrastructure to rooftop solar and electric vehicles.
By the end of 2014, the global “climate-themed” bond market was valued at $506 billion.
Just last week, Ontario announced the issuance of a second green bond, after its initial $500 million security was oversubscribed fivefold back in October 2014. Part of those initial investments funded the Eglinton Crosstown LRT line in Toronto.
"We are meeting a growing demand from investors who want a simple way to align their money and their environmental values,” said cofounder and CEO of CoPower, David Berliner, in the news release.
“The average investor was often excluded from impact investing opportunities in the past due to high capital requirements—until now."