Korea East-West Power raises $500M in world's first climate transition bond
What's the deal? Korea East-West PowerDealroom has a profile for this one. Try Dealroom → (EWP) has raised $500 million through the world's first climate transition bond aligned with International Capital Market Association (ICMA) guidelines. Bank of AmericaDealroom has a profile for this one. Try Dealroom → and HSBCDealroom has a profile for this one. Try Dealroom → led the deal as ESG structuring banks. The 5.5-year fixed-rate Eurobond priced at 58 basis points over equivalent US Treasury yields.
Why now? Investor sentiment toward Korean Paper has weakened amid concerns over US interest rate hikes and artificial intelligence investment overheating. Korea Electric Power Corp. (KEPCO) and its generation subsidiaries have also faced rejection from overseas investors over their coal-fired power plants as ESG investing takes hold.
How did it land? The bond drew orders exceeding $2.7 billion during bookbuilding, letting EWP tighten the spread from initial guidance of around 90 basis points and lift the issuance from $400 million to $500 million. Some high-quality investors raised their orders specifically on the ESG and climate transition characteristics.
What's the endgame? EWP plans to use the proceeds for renewable energy projects, converting coal-fired plants to LNG, improving energy efficiency, and hydrogen co-firing generation. The rated Aa2 by Moody's utility is working toward a 2050 carbon neutrality target.
Why the format matters? Green bonds require proceeds to fund environmentally friendly projects, limiting their use for carbon-intensive companies. ICMA published its climate transition bond guidelines in November 2025 to fill that gap, giving high-emitting firms a labelled route to fund credible transition plans.
The signal: At $500 million, EWP's raise sits in the 91st percentile of all-time debt rounds in the energy sector. The deal shows heavy-emitting power generators can still tap ESG-minded capital — provided they frame their funding around a credible path off coal.
Read more: Infomax
