ECONOMYNEXT – Resus Energy PLC, a renewable energy firm in Sri Lanka, will launch the country’s first-ever green bond issue by a local energy company to fund new projects and refinance past debts, the company said.
Resus will raise 1 billion rupees in the issue scheduled to open on Wednesday (25). This is the first green bond issue by a non-banking and finance company in Sri Lanka.
Resus, in a statement, said the issuance has already generated substantial market interest, with 100% of the proceeds dedicated to renewable energy projects.
NDB Investment Bank acts as the Manager to the issue.
“From the funds raised, Resus Energy proposes to utilize over 55% for financing 8 MW of clean solar capacity to Sri Lanka’s energy grid, generating an estimated 15 GWh of renewable energy annually and avoiding approximately 10,000 tonnes of CO₂ emissions per year, significantly contributing to the country’s climate commitments and sustainable development objectives,” the company said in a statement.
“The projects will be 100% owned by the company and will be connected to the national grid via Ampara and Pallekele substations.”
The company will issue up to 10 million senior, listed, rated, unsecured, redeemable green bonds at 100 rupees each.
The issue comprises two types of Green Bonds with type A offers a four-year tenure with a coupon rate of 11.55% per annum payable annually (AER of 11.55%), and Type B provides a five-year tenure offering 11.75% per annum payable annually (AER 11.75%).
Kishan Nanayakkara, Resus Managing director said raising 1 billion rupees through listing with an annual return of above 11.5 percent is more cost effective than borrowing from banks at fixed rates at present.
“If you look at it as of now, you can argue the bank’s cost is less. But we can’t borrow at a fixed rate from banks as of now at 11.5% for 4-5 years,” Nanayakkara told EconomyNext on the sideline of a media briefing over the green bond held on Monday (23).
“If there is an interest rate increase in the next 12 months, the bank borrowing could be expensive. We feel that the interest rates are at an interesting level. It is not very low. We have actually borrowed some existing loans at 8.5 percent also on a long term basis.”
“So I think 11.5 percent is not a bad rate looking at 4-5 year borrowing because we don’t have an alternative line like that at that cost to borrow for 4-5 years.”
The company believes these renewable projects create economic opportunities, improve essential services, and reduce fossil fuel dependence while supporting the Paris Agreement’s climate objectives and building community resilience.
Resus Energy currently operates 11 utility-scale renewable energy plants throughout Sri Lanka, comprising hydropower and solar facilities with a total capacity of over 30 MW and generating nearly 75 GWh of clean energy annually.
The company is also expanding its footprint internationally, with its first potential project reaching an advanced stage in the approval process in East Africa.
Fitch Ratings has assigned the Green Bond issue an A-(lka) rating. (Colombo/June 23/2025)