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LONDON, April 15 (Reuters) - The issuance of green bonds by corporates could reach up to $28 billion this year, three times more than last year, if the Chinese green bond market takes off as expected, credit ratings agency Standard & Poor's said on Friday.
Green bonds are created to fund clean energy or low-carbon infrastructure projects such as water treatment or wind and solar plants. They are typically issued by banks and corporate companies.
The corporate sector issued $9.6 billion in green bonds last year and will issue at least $15 billion this year, Standard & Poor's said in a report.
As more high-profile companies issue large green bonds, U.S. utilities show interest and investor demand grows, volumes should be boosted.
Added to that, the Chinese green bond market is expected to start this year which would add even more volumes to the issuance total.
"If the Chinese corporate green bond market takes off this year ... this could add around $13 billion to corporate green bond issuance in 2016, bringing total corporate green bond volumes to $28 billion," Standard & Poor's said in a report.
China is encouraging financial institutions and firms to issue green bonds as part of measures to widen financing channels for environmentally-friendly projects.
Moody's Investor Services said earlier this year it expects to see the issuance of all green bonds rise to over $50 billion this year, following a record $42.4 billion issuance in 2015 due to the global climate change agreement reached in Paris in December.
Reporting by Nina Chestney, editing by David Evans