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European Commission Gearing Up for Issuing €250 billion of NextGenerationEU Green Bonds

The European Commission has adopted an independently evaluated Green Bond framework, thus taking a step forward towards the issuance of up to €250 billion green bonds, or 30% of NextGenerationEU's total issuance. The framework provides investors in these bonds with confidence that the funds mobilised will be allocated to green projects and that the Commission will report on its environmental impact.

NextGenerationEU is a temporary recovery instrument of some €800 billion in current prices to support Europe's recovery from the coronavirus pandemic and help build a greener, more digital and more resilient Europe. To finance NextGenerationEU, the European Commission – on behalf of the EU – will raise from the capital markets up to around €800 billion between now and end-2026. This will translate into borrowing volumes of an average of roughly €150 billion per year.

Following the release of the framework, the launch of NextGenerationEU green bonds is imminent, with the first issuance already planned for October 2021, using the syndicated issuance format.

In line with standard practice, the framework will report on both allocation and impact. For the allocation reporting, the Commission will use Member States' data on spending on green projects. An independent external auditor will verify the allocation reporting.