U.S. chemical company Air Products issued two green bonds in multiple currencies. The $600 million green bond is a U.S. dollar-denominated fixed-rate note. Its second offering is a €700 million fixed-rate note denominated in euro.
The industrial gas producer plans to use the net proceeds to finance or refinance three areas of investments. The first is expenses and investments to prevent and control pollution via green and blue hydrogen and green and blue ammonia. The second will be used to finance renewable energy. And the third tranche will finance sustainable aviation fuel.
“We want to grow responsibly through sustainability-driven opportunities that benefit our customers and our world,” said Seifi Ghasemi, Air Products chairman, president, and CEO. “Importantly, our multi-currency green bond offerings make us the first U.S. chemical company to issue with green and blue hydrogen as an eligible expenditure category, further reinforcing our leading position advancing the energy transition through hydrogen for zero-emission transportation and industrial decarbonization.”
The company also ranks as the first major U.S. chemical company to have incorporated sustainability-linked ESG-related metrics into its $2.75 billion syndicated revolving credit facility in 2021.
Blue hydrogen comes from natural gas, whereby the carbon that’s generated during production is captured and stored underground permanently. Green hydrogen results from splitting water into its two components of hydrogen and oxygen using clean energy.
Air Products’ significant ESG investments include building Canada’s multi-billion-dollar net-zero hydrogen energy complex. The energy complex will have a $1.6 billion blue hydrogen production and liquefaction facility to be completed in 2024.
In 2021, the company announced an investment of $4.5 billion into a blue hydrogen clean energy complex in eastern Louisiana. The facility will produce over 750 million standard cubic feet per day of blue hydrogen.
Last year, Air Products committed to building Arizona’s green liquid hydrogen facility. The complex will produce 10 metric tons of green liquid hydrogen per day and is expected to be onstream this year. Its products will be sold to areas and states that require zero-carbon hydrogen fuel, such as California.
Also, last year, the company partnered with World Energy to build a new expansion of World Energy’s Sustainable Aviation Fuel (SAF) facility in California. The cost of the project will be $2.5 billion, creating the world’s first commercial-scale SAF facility, and North America’s only SAF facility. It will produce 340 million gallons of SAF annually.
At the end of 2022, Air Products announced that it would build and operate a $4 billion green hydrogen production facility in Texas in partnership with electric utility AES. This project will include 1.4 gigawatts of wind and solar power generation, as well as the capacity to produce 200 metric tons per day of green hydrogen. This would make it the largest green hydrogen complex in the U.S.
The company has set sustainability goals to reduce the intensity of its scope 1 and 2 carbon emissions by one-third by 2030. It also plans to reduce the intensity of its scope 3 emissions by one-third by 2030, with 2015 as the baseline year. The company is also working with the Science Based Targets Initiative (SBTi) and several other leading chemical companies to develop a sustainability framework and methodology for the chemicals sector.
