News Release
31 Aug 2022

Everbright Environment Issues 2022 Carbon Neutrality Bond Series 1, Being Committed to Environmental Sector and Seeking Carbon-linked Opportunities for a Green Future

31 August 2022, Hong Kong – Everbright Environmental Protection (China) Limited ("EEP China"), a wholly-owned subsidiary of China Everbright Environment Group Limited ("Everbright Environment" or the "Company") (SEHK: 257), completed the issue of EEP China Series 1 Green Private Placement Asset-backed Notes ("ABN") (Carbon Neutrality Bond) for the year 2022 ("2022 Carbon Neutrality ABN Series 1"), with an issue size of approximately RMB858 million and a maturity period of approximately 2.74 years.

The proceeds from the 2022 Carbon Neutrality ABN Series 1 issuance will be used by EEP China and its subsidiaries for replenishment of the working capital, repayment of debts to financial institutions and/or any other purposes in compliance with relevant national industrial policies and applicable laws and regulations. The 2022 Carbon Neutrality ABN Series 1 comprises the preferential carbon neutrality ABN and the subordinated carbon neutrality ABN. The preferential carbon neutrality ABN has an issue size of approximately RMB815 million, an interest rate of 2.80%, and a subscription rate of 2.43 times, with an "AAA" credit rating by Golden Credit Rating International Co., Ltd.. The subordinated carbon neutrality ABN has an issue size of approximately RMB43 million. Everbright Securities Company Limited acts as the lead underwriter for the issuance of the 2022 Carbon Neutrality ABN Series 1.

EEP China received approval on 16 December 2021 from the National Association of Financial Market Institutional Investors of the People's Republic of China ("PRC") to issue RMB-denominated ABN in single or multiple tranches to institutional investors in the national inter-bank bond market of China, with a total registered issue size of not exceeding RMB2 billion. On 28 December 2021, EEP China completed the issuance of the Series 1 Green Private Placement ABN (Carbon Neutrality Bond) for the year 2021, with an issue size of RMB672 million, which is considered China's first carbon neutrality-linked ABN that uses receivables relating to the national subsidies for renewable energy power prices for municipal biomass power generation projects as the underlying assets. The 2022 Carbon Neutrality ABN Series 1 is also considered the second tranche of the above-mentioned carbon neutrality ABN.

The total issue size of EEP China's first and second tranches of the carbon neutrality ABN exceeded RMB1.5 billion, which has not only helped to revitalise the Company's existing assets but also optimise its financing structure. This is also an excellent proof of Everbright Environment's continued practices in relation to China's strategic goals of peaking carbon emissions and achieving carbon neutrality ("Two Carbons"). Starting from this year, with guidance of China's Two Carbons strategic goals, Everbright Environment has been carrying out explorations and deployments with an emphasis on "Reduction of Pollution and Carbon Emissions" and "Pursuit of Synergy and Efficiency". It continued to optimise the Company's carbon calculation model to assess carbon emissions of its business operations, so as to better tailor its future carbon reduction strategies. By leveraging on its environmental protection projects, the Company launched several pilot programmes on various themes, such as low-carbon steams, in-plant solar power and roof-top solar power, which have improved synergy effect of the projects through reduction of pollution and carbon emissions. The Company also actively participated in the pilot programme on monitoring and evaluation of carbon emissions, which was initiated by the Ministry of Ecology and Environment of the PRC. Additionally, it carried out the pilot development of carbon assets for its projects and the development of a carbon asset management information platform. The Company also continued to carry out technology research and development relating to carbon capture, and completed the development of 100kg-level solid amine carbon dioxide capture materials.

As a leading player in China's environmental protection industry, as well as an active participant in the circular economy and sustainable development, Everbright Environment will continue to focus on its major business areas, actively grasp the the Two Carbons trend, and flexibly leverage resources and advantages from the capital market by further diversifying its financing channels, to facilitate its strategic transformation and high-quality development. Everbright Environment is dedicated to better fulfill the demands for environmental protection products and services, as well as expectations for sustainable and wonderful living environment, from the country, the society and the public.