Green bond market still small, with likes of Tesla skipping it

New York

INVESTORS are hungrier than ever for green bonds, yet companies known for their sustainable prowess - including Tesla Inc - are choosing to sit out, raising questions about just how valuable the label is.

US non-financial companies have been among the slowest to embrace green bonds - debt that's designated to only finance eligible green projects - issuing just US$4.3 billion last year, a tiny fraction of an overall US corporate bond market that sold US$1.6 trillion. US companies are expected to issue US$5.2 billion of green bonds this year, meaning a green label for Tesla's offering last week would have grown US corporate issuance in 2017 by more than a third, according to Bloomberg New Energy Finance data.