New York's Metropolitan Transportation Authority expects to issue more green bonds in 2017, a finance official told board members on Monday.
The MTA, one of the largest municipal issuers with roughly $35.7 billion of debt, issued two green bond deals last year. Both "were very well-received by the market," deputy finance director Olga Chernat said before the finance committee.
"Many issuers followed in our footsteps," said Chernat. "Overall we feel that our green bond program is a successful one."
She did not quantify how much the MTA expects to issue. Overall the authority intends to sell $6.8 billion for 2017, including $2.6 billion in new money, $2.3 billion in bond anticipation note takeouts, $1 billion in refunding and $860 million worth of remarketing.
Overall the MTA issued $7.76 billion of debt in calendar 2016. "We were very busy last year," said Chernat.
Its $782.5 million transportation revenue bond issuance in February 2016 was the first to receive U.S. certification from London-based Climate Bonds Initiative, which uses low carbon transport criteria. The MTA also issued $588.3 million in dedicated tax fund bonds in May.
Low carbon transport criteria establishes what transportation projects apply for certification. Projects are determined eligible if they are compatible with an emission trajectory that limits global temperature rise to 2 degrees Celsius, or 3.56 degrees Farenheit.
Chernat said that the MTA's transportation network prevents about 17 million metric tons of greenhouse gas emission annually, and that the network outperforms single-occupancy vehicles, including indirect emissions.
According to Thomson Reuters, 52 U.S. green bond deals in 2016 totaled $7.6 billion.
The Washington, D.C. Water & Sewer Authority expects to price its third green bond issuance on Jan. 31, designated one-third of its $300 million public utility senior lien revenue bond term offering as green. Once placed, said Moody's Investors Service, that will represent a combined $550 million issuance for DC Water since July 2014.
According to Chernat, MTA officials did year-round market outreach in 2016 that included a speech by finance director Patrick McCoy at a Municipal Forum of New York luncheon, conference participation and several meetings with institutional investors.
