Green Bonds Coming Into Vogue

A colleague of mine predicts a huge future for green bonds, e.g., municipal bonds that are directed solely at environmental targets: renewable energy, smart grid, clean transportation, etc. Linked above is an article that describes what Portland, Oregon is doing in this capacity.

This is a fledgling market now, but it is bound to expand. And as more investors climb on board, the coupon rates will fall, meaning a lower cost of capital enabling more projects to be completed. Perhaps that’s a good reason to buy now.