Capital-intensive Projects Research Articles

Appraising the application of cryptocurrency technologies in the Nigerian built environment: stakeholders’ perspective

PurposeTwenty-first century digitalisation birthed new methods of payment systems like the emergence of cryptocurrencies. Cryptocurrency technologies have been identified as drivers for crypto-smart contracts and procurements. Studies regarding the application of cryptocurrency technologies in the Nigerian built environment industry are uncommon. Therefore, this paper aims to explore the relevance of cryptocurrency technologies to the sector, examine the perceived barriers that may hinder cryptocurrency technologies implementation and propose measures to promote the applications.Design/methodology/approachThe research conducted a virtual interview across Abuja and Lagos cities to appraise stakeholders’ perceptions. The interviewees were requested to proffer answers to the research questions. The study conducted 25 semi-structured interviews with knowledgeable stakeholders. The data were analysed, and findings were reported in themes.FindingsEnhanced the era of smart contracts, increased liquidity for small and medium-sized enterprises (SMEs) and new openings to raise more funds for capital-intensive construction projects emerged as the advantages where cryptocurrency technologies can benefit the sector if allowed to operate. Cryptocurrency technology applications are not without some anticipated hindrances. Risk of loss of investment/price instability, lack of intrinsic value, money laundering, attracting speculators, criminal activities/security issues, lack of clarity and awareness and lack of skills emerged as the frequently anticipated barriers that may hinder cryptocurrency technologies applications.Research limitations/implicationsThe study is limited to cryptocurrency technology applications in Nigeria’s built environment, and a qualitative method has been adopted.Originality/valueBesides uncovering barriers hindering cryptocurrency technology usage via an unexplored mechanism, the study is one of the few studies to proffer measures to improve cryptocurrency technology usage in the built environment.

Forecasting financial distress in listed Chinese construction firms: leveraging ensemble learning and non-financial variables

The construction industry, characterized by high business failure rates due to complex, capital-intensive projects, is crucial for China’s economy. Predicting financial distress and early warnings is crucial to prevent crises. While financial ratios are commonly used, non-financial information remains underexplored, with limited empirical evidence supporting its effectiveness in enhancing predictive accuracy. Additionally, most studies on financial distress prediction focus on constructing single classifiers without utilizing ensemble models that integrate multiple algorithms, resulting in suboptimal prediction accuracy. To address these problems, this study presents a model that uses accounting variables and firm characteristics, construction market dynamics, and macroeconomic indicators to predict the probability of failure one to two years in advance. The model uses a soft voting-based ensemble algorithm, financial ratios refined through the recursive feature elimination with cross-validation (RFECV) algorithm, and dataset balancing via Synthetic Minority Over-Sampling Technique + Tomek Link (SMOTETomek). The comparison results indicate that the predictive performance of the soft voting ensemble model outperforms all single classifiers across all combinations of input variables and prediction years. Additionally, incorporating non-financial variables, such as firm characteristics, construction market dynamics, and macroeconomic indicators, further enhances the model’s accuracy. The proposed model can be effectively employed to help stakeholders mitigate the risks associated with the financial distress of construction companies before the project implementation phase.

Potentials of greenhouse gas emission reduction through energy efficiency improvement in Iran's petrochemical sector

Reducing energy consumption and increasing energy efficiency is a key strategy to mitigate greenhouse gases (GHGs) in the petrochemical sector, both because of the high share of energy-related emissions and because of the economic attractiveness in terms of return on investment. This paper aims to calculate the GHG mitigation potentials of the energy reduction projects in Iran's petrochemical sector. firstly, we estimated the trend of GHG emissions until 2035 using data collected from the petrochemical complexes in Iran. Then, by assessing the energy audits and other studies, we calculated the energy consumption reduction potentials as well as their costs and benefits for petrochemical complexes. Finally, we modelled the energy supply and demand of the petrochemical sector in LEAP software to evaluate the mitigation potentials of the energy reduction projects. The results show that a 6.7 % emission reduction in the existing petrochemical complexes can be achieved with a capital of about 160 million dollars. The net present value of the projects will be about 2 billion dollars, and the cost of carbon reduction will be −60.7 dollars per ton. The results of this research can be used for policymakers to plan the mitigation pathway of the sector since the revenues obtained from the energy conservation measures can be used to fund capital-intensive GHG mitigation projects.

Temporal frictions: competing futures of LNG in Tanzania

ABSTRACT This paper explores the temporalities behind resource nationalism and the liquefied natural gas project (LNG) in Tanzania. At a cost of $42 billion, the LNG project would be one of the most capital-intensive projects in Africa and would allow for export of Tanzanian gas. Focusing on the LNG negotiations during the rule of John Pombe Magufuli, this paper uses interviews with key stakeholders involved in the negotiation and planning of the LNG project, both from the government and the hydrocarbon sector. It argues that competing imaginaries of the future of the gas sector in Tanzania has led to friction between actors and has resulted in slow progression for the project. Central to this has been competing short-, medium-, and long-term time horizons, contrasting market and electoral cycles, and differing imaginaries of what the future of LNG holds for the country. This paper’s core argument is that competing perceptions of the future between different actors involved in the project, have allowed for friction between actors. At its core, this is through how the future was constructed for actors, be it through development strategies, price forecasts, or different imagined futures.

Prerequisites for the formation of business alliances among agricultural exporters in Ukraine under martial law

This article explores the state and structural trends of the grain and oilseed market under martial law in Ukraine, focusing on the prerequisites for the formation of business alliances. In scientific literature, business alliances are often seen as strategies for achieving competitive advantages in globalized markets by pooling the resources and competencies of independent companies. However, the formation and functioning of business alliances in countering extreme business conditions remain underexplored. This study aims to summarize the prerequisites, factors, and potential benefits of forming business alliances among agricultural exporters. Despite the negative impact of war, Ukrainian agribusiness has demonstrated resilience and adaptability by maintaining a leading position in exports. The analysis of exporter ratings has shown significant changes in the distribution of market shares during the first two years of the war, indicating shifts in the market roles traditionally played by participants. Interviews with the CEOs of leading agricultural holdings in Ukraine outlined the main tactical and strategic decisions taken to mitigate the challenges of the war. Partnerships among independent agricultural producers have been widely used to respond to challenges such as closed export markets, finding new export routes, and achieving the necessary scale for export operations. Systematizing this experience could be of scientific and practical interest, particularly in the context of ongoing events in Ukraine. Effective communication and alliances among participants in the grain market may help address critical tasks such as creating competitive advantages in global grain trade, reducing costs for external and internal logistics, jointly using logistics infrastructure, and investing in capital-intensive projects to develop export infrastructure, especially under increased risk conditions.

Assessment of the Economic Consequences of Riverbank Erosion: The Case of the South Morava River, Serbia

Landscape transformation, degradation and destruction are caused by fluvial processes as the predominant erosive processes in Serbia. The loss of arable land due to riverbank erosion is permanent, and the economic consequences are, therefore, especially pronounced. The primary aim of this study was to quantify the intensity of riverbank erosion in the lower part of the South Morava River (Serbia) during period 1924–2020, evaluate its economic consequences, and conduct a cost benefit analysis of revetment investments. The economic effects of riverbank erosion were analyzed by means of land loss and reduction in the quantity of agricultural production. An interdisciplinary research approach was applied using specific methodological procedures to calculate the riverbank erosion and soil (land) loss intensity (geographic information system-GIS), the economic consequences of riverbank erosion (ECRE), and the results of an investment decision-making model. The results showed that 202.6[Formula: see text]ha of arable land was lost during the observed period, the value of arable land loss was almost 622,000[Formula: see text]USD, and the loss in agricultural production was 7.5 million USD (discount rate 3.7%). The model is seen as the main research output and can be used for the assessment of long-term capital-intensive infrastructure projects in developing countries. The analysis identified the river segments that are economically viable for investments in riverbank revetments to preserve the largest area of fertile agricultural land. The results are especially valuable for river channel management, environmental planners and policy-makers, who deal with decisions regarding planning and the protection of bank erosion in areas of particular interest.

The Dynamics of Public Financing in Heavy Engineering Projects: A Comprehensive Analysis of International Relations

The study examines public financing in heavy engineering projects, highlighting the importance of a multidisciplinary approach. Key factors include bilateral agreements, international financial institutions, and geopolitical tensions. Public financing is crucial for long-term, capital-intensive projects, and institutional capacity and governance effectiveness are essential for successful implementation. The research integrates economics, political economy, and institutional theory to provide practical insights for policymakers, project managers, and investors. Key factors influencing financing mechanisms include bilateral and multilateral agreements, international financial institutions, and geopolitical tensions. The study emphasizes transparency, accountability, and governance in infrastructure financing, as well as collaboration among countries, international organizations, and the private sector. This contributes to understanding global governance and cooperation in infrastructure investment, guiding optimization of financing strategies, and promoting sustainable development outcomes. Keywords: Engineering projects, International relations, multidisciplinary approach and public financing

Creating sustainable public private partnerships through corporate governance in the Sub-Saharan Africa (SSA)

Governments of Sub Saharan African (SSA) countries have struggled to successfully invest in capital intensive projects. As such, public private partnerships play a key role in redefining the role of Government in the context of infrastructure projects, by focusing on supervision and regulation and moving away from direct ownership and management. Sub Saharan African countries have seen such inclusive partnerships yielding some numerous benefits in different sectors. However, despite the salubrious benefits that PPPs have brought in different projects, PPPs in SSA countries are still dogged by a myriad of administrative, technical, financial and legal challenges. These corporate governance related challenges have made it difficult for these SSA governments to glean the full benefits of PPPs. The study is informed by the qualitative methodology with an extensive review of literature. Data was gathered from purposively selected written documents and these documents were analysed using thematic and content analysis techniques. The study established that there are some corporate governance deficiencies in most PPP projects in the SSA countries. Additionally, most of these public projects in the SSA lack adequate good corporate governance attention that is given to the PPP procedures and processes involved. The study therefore recommends that there is need for the full adoption of good corporate governance systems, practices, processes and procedures in the PPPs designing, financing, implementation and operationalisation in SSA.

Global Refuse, Planetary Remainder

The line separating the “good life” and the savagery that the “good life” requires, or, perhaps what might be articulated as the line between the space of biopolitics and the space of necropolitics, is maintained in the present through both practices of global policing and imperial war. These practices of policing and war produce the very global refuse that constantly threatens the “good life”—actively wasting the lives and livelihoods of people and non-human lifeworlds Western colonialism established as the raw materials, instruments, and objects of its civilizational goal—against which violence acts to protect a fundamentally human life worth living. At the same time, through capital-intensive projects of “saving” the very targeted populations it destroys, permanent war also produces the subordinated life that will come to serve as the means of maintaining and upholding that “good life.” Beyond this mode of colonial inhabitation, however, subsist other ecologies of life-making practices on the part of those deemed disposable, a planetary remainder which might well be our only hope for a possible future.

Оценка реализации национальных проектов в сфере транспортной инфраструктуры (на примере регионов ЮФО)

The article analyzes the preliminary results of the implementation of the “Safe Quality Roads” and “Comprehensive Plan for the Modernization and Expansion of Main Infrastructure” projects, and identifies the regional features of their implementation for individual regions of the Southern Federal District - the Rostov region, the Krasnodar Territory, the Republic of Crimea. By 2022, the basic values ​​for individual target indicators have been achieved and, in general, given the existing positive dynamics in 2024, the rest will most likely be achieved. At the same time, project passports require revision taking into account regional characteristics. In Crimea, the share of roads that meet regulatory requirements is determined at a fairly low level - 38.8%, and with the current trend towards an increase in freight turnover, motorization, and tourist flow, road safety is significantly reduced, as evidenced by high accident rates. In this regard, target indicators for the quality of the road network should be revised upward. For the Rostov region, the federal project “Road Network” should include a list of agglomerations and for each of them the values ​​of basic indicators should be determined. Particular attention should be paid to the issue of transport support for small isolated settlements in all regional passports. “Safe Quality Roads” and “Comprehensive Plan for the Modernization and Expansion of Trunk Infrastructure” are labor-intensive and capital-intensive projects that require modern equipment and technologies. Infrastructure development will support the overall economic strategy. However, to achieve the assigned tasks, it is necessary to mobilize industrial production so that the modernization and creation of infrastructure is provided with domestic equipment and technologies. Based on the results of 2021, it can be argued that a qualitative transformation of the economy, accompanied by an acceleration in the growth rate of labor productivity, did not occur.

Parsi capital and imperial infrastructure: Shipping and shopping in the port of Aden, 1840-1888

AbstractFor a century following the opening of the Suez Canal, the scale and scope of global capital and information flows was predicated on a chain of imperial outposts like Aden, where ships could replenish their fuel supplies while shorefront godowns and telegraph stations gathered commodities and information to be received, processed, and relayed; by the 1950s, over 5,000 vessels called on the harbour annually, making Aden the second busiest port in the world after New York. This article explores the role of Indian-Zoroastrian (Parsi) capital in shaping the material and institutional development of the port of Aden. Parsi firms mediated between international shipping and the hostile environment of the desert colony, supplying provisions and providing brokerage and agency, or dubash services, literally meaning ‘translator’ in the vernacular. More than a particularly successful comprador community, however, Aden Parsis developed an elaborate transoceanic trade predicated on self-financed, capital-intensive infrastructure projects. Tracing the outsourcing of imperial statecraft to dubashes in Aden allows us to provincialize the making of first-wave globalization, as it was predominantly Parsi capitalists rather than European businessmen who were the driving forces of Aden’s development.

Adapting international natural gas and LNG agreements in the light of the energy transition

Abstract This article will examine the bidirectional relationship between private energy contracts and the transition towards a net-zero world. It will focus on long-term take-or-pay natural gas and liquefied natural gas sale and purchase agreements (natural gas and LNG SPAs) that are commonly used in the natural gas sector. These agreements often contain highly restrictive clauses that are designed to ensure stability of supply and demand, which makes them suitable for acquiring the project financing necessary for large capital-intensive energy projects. At the same time, these agreements create an important lock-in effect for the contracting parties. This article will examine the details of gas SPAs from the perspective of this lock-in effect. It will show that current contractual formulations do not provide an adequate solution in the context of the energy transition. Because of this lock-in effect, there is an urgent need to adapt existing contract forms for future use, and to modify the continued application of existing executory contracts to accommodate new realities.

Economic and technological approach to the design of offshore field development. Review of foreign practices

Relevance. The high profitability potential of hydrocarbon production on the Russian Arctic shelf is one of the significant factors for the further development of the Russian oil and gas complex. For decades, international oil and gas companies (OGCs) have been successfully implementing large capital-intensive projects to develop offshore fields in underdeveloped regions with severe climatic conditions, including at unfavorable oil prices. The purpose of the research is to identify the features of the methodology used by international oil and gas companies to implement projects that ensure their success. Methodology. Systematic approach, methods of analysis, comparison, differentiation. Results. In the course of the study, the content of a systematic approach to the development of offshore fields was disclosed as the basis of the methodology in terms of the optimal choice and integration of technologies in the field development system in terms of cost and efficiency. The concepts and relationships between the system, subsystem and technology are defined. It is shown that the profitability of field development is ensured by compliance with the necessary criteria for the applicability of technologies as part of the development system. At the same time, the technologies must be confirmed by the practice of performing a similar production task under comparable conditions and are available for purchase in a competitive market, and they must also meet the requirements for the efficiency of performing a production task and restrictions on the cost of developing a field. The theoretical aspects of the methodology are illustrated with practical examples of the assessment and selection of technologies according to the specified criteria, including the implemented system of offshore field development in a poorly developed region. Based on the results of the study, recommendations were formulated on the selection of offshore fields for priority development and exploitation, the choice of technologies for field construction, as well as the application of accepted international regulations for more active implementation of oil and gas projects on the Russian Arctic shelf. Conclusions. Based on the review of foreign practices, it is recommended to: 1) focus primarily on projects using proven and available technologies; 2) clearly form a set of requirements for the developed projects; 3) apply the principles and rules laid down in the design regulations of foreign oil and gas companies and EPC companies.

ANALISIS PENGARUH UPAH MINIMUM, INVESTASI DAN PENGELUARAN PEMERINTAH TERHADAP PENYERAPAN TENAGA KERJA DALAM PERSPEKTIF EKONOMI ISLAM

Abstract. 
 Absorption of labor is an important problem in national development where the number is increasing from year to year as a result of the increase in population, while the available job opportunities are limited in number, so that the unemployment rate in several cities is increasing. A high level of investment will increase production capacity which will eventually lead to the creation of new jobs. That way, the unemployment rate can be reduced and people's incomes will increase. This research is a quantitative research with secondary data in the 2015-2021 observation period. Data collection in this study uses the documentation method for data on Population 15+ Working, Investment and Minimum Wage obtained from BPS, Department of Manpower and Office of Investment. The collected data is analyzed using multiple linear regression analysis. Overall, the results of multiple linear regression analysis and hypothesis testing can be concluded that partially investment and minimum wages have no significant effect on employment in Indonesia. Simultaneously, it shows that the investment and minimum wage variables have no simultaneous effect on employment in Indonesia. The lack of effect of investment on labor absorption in Indonesia is due to the fact that more investment is channeled into the capital-intensive project sector (services) compared to the labor-intensive project sector, where the capital-intensive project sector absorbs only a small amount of labor. Meanwhile, the minimum wage has no effect on labor absorption because the majority of the working population in Indonesia have received relatively high wages or exceeded the minimum wage. Employment. Absorption of labor in the perspective of Islamic economics is that the government has made various efforts as its responsibility to provide jobs for its people. The essence of Islamic economics in reviewing the power market based on an Islamic perspective shows the potential in generating economic equality in society and realizing prosperity
 
 Keywords: national development, Investment, Minimum Wage

Assessment of irrigation water distribution using remotely sensed indicators: A case study of Doho Rice Irrigation Scheme, Uganda

The rising competition for scarce land and water resources and the need to satisfy the global food demand from an ever-growing population necessitates novel methods to monitor irrigation scheme performance for improved water use efficiency. The traditional methods employed in sub-Saharan Africa to assess irrigation performance are point-based, expensive, and time-consuming, making monitoring and evaluation of these capital-intensive projects difficult. This study aimed at employing satellite data with high spatial and temporal resolution in assessing the performance of Doho Rice Irrigation Scheme through estimations of actual evapotranspiration. Actual evapotranspiration (ETa) was modelled from Landsat 7 imagery using the surface energy balance system algorithm on five clear days between January and April 2020. Using equity and adequacy metrics, the derived ETa was used to assess the irrigation performance of the scheme. Results showed that the equity indicator was generally fair, with the coefficient of variation between 0.11 and 0.08, close to the 0.10 threshold implying irrigation water is fairly distributed within the scheme. The average adequacy was 0.87, above the 0.65 threshold, indicating adequate water supply throughout the scheme. The study's findings can be used in future research and benchmarking with other irrigation schemes to address the country's water resource management challenges.

Installation planning for an offshore wind farm: a hybrid modelling framework of integrating simulation and optimisation with a Markov Chain

ABSTRACT Offshore wind energy has been rapidly gaining traction more recently and the development of offshore wind farms continues to rise on a global scale in search of a sustainable future energy source. In the meantime, the capital-intensive project of installing wind turbines offshore involves a multitude of logistics activities and maritime operations. The high-risk installation process becomes more complex, in particular, under the uncertain weather conditions at sea such as wind speed and wave height. We present in this paper a hybrid modelling framework that minimises the overall installation time required to build an offshore wind farm, and develop a mixed-integer linear program submodule embedded on the discrete event simulation model. In addition, to take stochastic weather states into consideration, a Markov-Chain Monte Carlo method is used to generate weather instances with uncertainty. The weather occurrence serves as an integrated look-ahead viewpoint in making turbine component installation decisions. Further, the experiments of sensitivity analysis are designed to draw insights regarding the effects that the number of turbines, the number of vessels, and the seasonality have on the total project timespan. The computational results demonstrate the efficacy of our proposed hybrid solution approach, tested on the case of Southwest Offshore Wind Farm in South Korea.

Регіональні особливості іноземного досвіду інвестиційного забезпечення інноваційних трансформацій: специфіка фінансування науково-дослідної та дослідно-конструкторської діяльності

The article substantiates the expediency of borrowing advanced foreign experience of investment support of innovation activity to accelerate the processes of innovative transformations in the regional economic complexes of Ukraine in order to ensure accelerated post-war recovery and formation of the sector of high-tech industries. The authors summarize the best foreign experience (the USA, Japan, Germany) in financing research and development (R&D) in the context of the main trends in the development of the global economy. It has been found that the models of investment provision of innovation activity in the United States, Japan and Germany differ both in terms of subject-object base and in terms of financing priorities regarding the development of the material and technical base and the formation of human resources for university science and the research industry of the corporate sector. It is determined that in the context of interweaving of national economies and formation of international network structures, the key actors in financing innovation activities are transnational corporations, which, due to the high level of concentration of investment potential, finance the most capital-intensive innovative projects, thus decisively affecting the modernization of the basic links of the economies of the advanced countries of the world and the pace and scale of development of the natural wealth of the world economy. It is substantiated that in the context of borrowing advanced foreign experience for the domestic practice of financing innovative developments at the regional level, it is worth adopting the experience of financial and investment support for innovation activities in the Federal lands of Germany. It is proved that the implementation of the experience of financing innovation activities in the German Federal lands, specializing in the development of the agricultural sector, processing and food production and woodworking, will allow the regions of Ukraine of agrarian specialization to form poles of economic growth and ensure the effective use of local labor, production, technical and natural resource potential. It is substantiated that in the context of the deficit of local public finances, the basis for stimulating innovative development at the regional level is the creation of cluster-type network structures, allowing to consolidate the efforts of local authorities, higher education institutions, research institutions, design organizations and financial and credit structures in the direction of producing innovative products and their implementation in the practice of production, economic and commercial activities.

Фінансування інновацій ТНК у контексті інноваційної трансформації економіки регіонів України

It has been found that the world flagship of financing innovation activities are TNCs, which, due to the high level of concentration of investment potential, have the opportunity to finance capital-intensive innovation projects related to the modernization of the most high-tech industries and basic information and telecommunication technologies. It is proved that the selection of sources and methods of financing the innovation activity of TNCs depends on the stage of the life cycle of an innovative product, which makes it possible to timely eliminate the deficit of financing by diversifying the sources of financial and investment support for research, development and approbation of prototypes of equipment and technologies. Studies have shown that the financing of innovation activities in American, European and Japanese TNCs is marked by their distinctive features based on the structure of sources of funding for research and development, in particular the participation of the State in this process. It is determined that Ukraine needs an innovative model of transformation of the post-war economy in order to eliminate at an accelerated pace the terrible consequences of the armed invasion of russian aggressors, to modernize energy-intensive segments of the national economy, to ensure the mass introduction of modern innovative technologies in all phases of the reproductive process and to use the existing production and technical potential of regional economic complexes to straighten territorial imbalances of the socioeconomic development. It has been found that the main catalyst for innovative transformation of regional economic complexes in Ukraine is the inclusion of TNC divisions in them, primarily in terms of financing the processes of production and introduction of innovative technologies. It is substantiated that in the context of the expediency of implementing the best practices of financing research and development into the domestic practice of innovative transformation of the regional economy, it is worth adopting the South Korean experience, which allowed this country to turn from an industrially backward agrarian country into an advanced country in Southeast Asia in a few decades.

Oil-supply news and dynamics of exchange rates in oil-exporting countries

Most sub-Saharan African (SSA) countries have benefited and also suffered from the consequences of oil price fluctuations. The suffering of these nations has reverberated especially from the influencing power of exchange rate volatility, high inflation as well as an adverse impact on other macroeconomic variables. Therefore, this study estimated the magnitude of the effects of oil supply news shocks on the dynamics of exchange rates and also, the impact of exchange rate dynamics on oil supply news shocks in oil-exporting countries of West Africa (WA) countries. We implemented a panel non-linear autoregressive distributed lag (P-NARDL) model. The finding of the study indicates that rising fluctuations in oil prices caused by Organization of the Petroleum Exporting Countries (OPEC) news of oil supply disruption significantly induce exchange rate devaluation. Unambiguously, a 1 percent increase in oil supply news shocks stimulated 1.59432 percent appreciation while the same-size decrease in oil prices led to 0.86397 percent devaluation. These validate asymmetrical presence in exchange rate behaviour concerning the oil market. Also, we found 1.09452 percent devaluation and 0.25371 percent appreciation in the exchange rates of oil-producing African nations following a 1 percent rise and fall in inflation rates indicating a symmetric relationship between inflation rate and exchange rates. Oil-producing countries of WA should utilize foreign exchange (FX) from oil export to acquire capital-intensive projects.

The Efficiency of Environmental Project Financing with Green Bonds in the Energy Sector: Evidence from EU Countries

This paper investigates whether the issue of green bonds by energy companies allows lowering the cost of funding for their environmental projects. We use empirical data on green bond placement in the energy sector and comparable conventional bond yield curves to prove the existence of the green bond yield discount. The sample includes 37 plain vanilla green bond issues and comparable yield curves of EU energy companies for 2017–2020 with total volume EUR 25 bn. We demonstrate that green bonds have a 4.7 bps lower average yield compared to conventional bonds. This green bond discount is statistically significant at a 5% level and does not depend on issue size or debut status of the issue. We draw three main conclusions: (1) energy companies may lower cost of funding by issuing green bonds, making environmental projects more economically attractive, (2) the green bond discount is present for both inaugural and subsequent green bond issues, which makes it reasonable to finance all environmental projects with green bonds, (3) the green bond discount does not depend on the issue size, which makes green bonds an appropriate choice for financing capital-intensive projects.