Finance, Industrial, Sourcing Renewables - February 12, 2024
Dow Chemical Completes First Green Bond
The Dow Chemical Company, a wholly owned subsidiary of Dow, announced the closing of its green bond offering of $600 million aggregate principal amount of 5.150% notes due 2034 and $650 million aggregate principal amount of 5.600% notes due 2054.
The notes represent the company's inaugural green financing instrument, in alignment with Dow's Green Finance Framework, published on January 25, 2024 via the company’s website.
The framework was established to support the execution of Dow's sustainability strategy and achieve its targets focused on climate protection and a circular economy.
The chemical company intends to allocate proceeds from this offering toward projects that meet eligibility criteria contained within the framework, including expenditures and investments related to its Fort Saskatchewan, Alberta Path2Zero ethylene and derivatives project.
"This green bond offering marks a foundational opportunity for investors to participate in Dow's strategy to decarbonize and drive circularity while growing earnings over the cycle," said Jeff Tate, Dow's chief financial officer, in a statement. "We expect the proceeds of this instrument to primarily support our project to build the world's first net-zero Scope 1 and 2 emissions ethylene and derivatives complex in Alberta, which achieved the critical milestone of final investment decision from our Board in November 2023."
In 2020, Dow announced its goal to be carbon neutral for Scopes 1,2, and 3 plus product benefits by 2050. The commitment included a mid-term target to reduce by 2030 the company's Scope 1 and 2 net annual carbon emissions by 5 million metric tons versus its 2020 baseline.
The company must reach a goal of a total of 30% emissions reduction versus Dow's 2005 level to achieve its 2030 goal.
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