Green Bonds and Land Conservation: The Evolution of a New Financing Tool

27 Pages Posted: 9 Dec 2015

See all articles by Carolyn DuPont

Carolyn DuPont

Harvard University - Harvard Kennedy School (HKS); Massachusetts Institute of Technology (MIT) - Sloan School of Management

James Levitt

Harvard University Program on Conservation Innovation at the Harvard Forest

Linda Bilmes

Harvard University - Harvard Kennedy School (HKS)

Date Written: December 7, 2015

Abstract

"Green Bonds" emerged as a new form of environmental financing in 2007. While most investors still view them as a niche product in the overall fixed income market, green bonds have grown rapidly to nearly $37 billion in issuance in 2014, with issuers from the World Bank to the State of Massachusetts. This paper examines the current and potential future use of green bonds for financing sustainable land use and conservation projects around the world. The paper draws on interviews with land conservation practitioners, bond issuers, investors, and financial analysts, as well as analysis of two case studies in China and Massachusetts. The paper summarizes the key insights from this community of experts, and lays out a series of steps that will be required before green bonds can develop into a significant and reliable tool in the conservation finance toolkit. The authors find that projects linked to water and storm water management may be investment "sweet spots" for green bonds and land conservation.

Keywords: Environment, Environmental Policy, Bonds, Finance, China, Massachusetts

Suggested Citation

DuPont, Carolyn and Levitt, James and Bilmes, Linda, Green Bonds and Land Conservation: The Evolution of a New Financing Tool (December 7, 2015). HKS Working Paper No. 072. Available at SSRN: https://ssrn.com/abstract=2700311 or http://dx.doi.org/10.2139/ssrn.2700311

Carolyn DuPont

Harvard University - Harvard Kennedy School (HKS)

79 John F. Kennedy Street
Cambridge, MA 02138
United States

Massachusetts Institute of Technology (MIT) - Sloan School of Management

100 Main Street
E62-416
Cambridge, MA 02142
United States

James Levitt

Harvard University Program on Conservation Innovation at the Harvard Forest ( email )

1875 Cambridge Street
Cambridge, MA 02138
United States

Linda Bilmes (Contact Author)

Harvard University - Harvard Kennedy School (HKS) ( email )

79 John F. Kennedy Street
Cambridge, MA 02138
United States
617-495-4753 (Phone)
617-496-2554 (Fax)

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