The EU launched its first-ever green bond to record demand on Tuesday, according to a lead manager, taking its first step to potentially becoming the biggest issuer of environmentally-friendly debt with a record-sized deal. The 15-year green bond, which will raise €12 billion ($13.9 billion), received more than €135 billion of demand, a lead manager told Reuters, making it the largest green bond launch and the highest level of demand for a green bond sale to date. The bond, which will finance member states’ environmentally beneficial projects as part of the bloc’s COVID-19 recovery fund, is the first step for the EU — which aims to be carbon-neutral by 2050 — toward becoming a leading force in the fast-growing green debt market. Green bonds will fund 30 percent of the EU’s up to €800 billion COVID-19 recovery scheme, which gives grants and loans to members states until end-2026. Up to €250 billion of issuance could transform the EU into the world’s biggest green bond issuer. Such is the scale of the issuance that analysts at BofA Securities expect the EU will issue €35 billion to €45 billion in green bonds every year — equivalent to what all European sovereign and supranational borrowers issued in 2020. Bram Bos, lead portfolio manager for green bonds at NN Investment Partners, said the scale of issuance from the EU would increase the liquidity of the green bond market significantly. “I think the possibility and barriers to start ‘greenifying’ your government portfolios is getting easier and easier with these kinds of issuances from the EU, which in terms of size is massive,” Bos added.