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Green bond issuance was strong in the first quarter (Q1) of 2017 and it’s on track to reach record levels this year, according to a new report from Moody’s Investors Service Inc.

The credit-rating agency finds that global green bond issuance was significantly higher in Q1 compared with Q1 2016, led by a €7-billion issuance by France, the largest green bond issue so far. “[This] bodes well for additional sovereign issuance,” the Moody’s report says.

Almost US$30 billion in green bonds was issued globally in Q1, which puts the sector on track to top last year’s record of US$93.4 billion for a full year.

“Green bond issuance remained healthy in the first quarter of 2017, reaching US$29.5 billion, up 75% from the first quarter of 2016,” states Henry Shilling, senior vice president at Moody’s, in a statement.

Renewable energy and energy efficiency projects were the two leading types of projects financed by green bonds in the first quarter, accounting for 42% of total issuance, the Moody’s report states. Clean transportation projects ranked third.

The report notes that the green bond market is “continuing to evolve,” adding that “the number of sovereign issuers will likely increase, momentum from the Paris Agreement will expand the market’s geographic reach and new security structures will continue to emerge.”

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