IslamicFinance.de

Investor appetite for green sukuk is growing in the Arabian Gulf countries despite the lukewarm economic growth amidst the ongoing pandemic. Saudi Arabia’s electric transmission monopoly, Saudi Electricity Company (SEC), issued a multi-tranche $1.3 billion green sukuk and reported an order book of more $5.2 billion, indicating the immense appetite for sustainable Islamic bonds. The proceeds of SEC’s sukuk will be used to finance green projects relating to energy efficiency and renewable energy. Currently, Saudi Arabia is almost exclusively reliant on fossil fuels for power generation and has a high energy usage per capita because of its reliance on air conditioning and desalinated water. The green sukuk market is still in its infancy, with only a handful of issuances taking place.

Allen & Overy, associated with local law firm Abdulaziz AlGasim Law Firm, advised Saudi Electricity Company (SEC), on the successful closure of its $1.75 billion dual-series Sukuk issue. The transaction represents SEC's first international Sukuk issuance and the largest international debt capital markets issuance to date out of Saudi Arabia.
The transaction was organized as a Sukuk al-ijara, with the two series of trust certificates launched by Saudi Electricity Global SUKUK Company.