Abstract: Purpose/Significance The lack of quantitative analysis of the environmental protection effect of green bond issuance, especially the quantitative analysis of indirect spillover effect, leads to the situation that the green bond rating is the same but the issuance effect is very different, which makes the evaluation of the environmental protection effect of green bond inaccurate. Design/Methodology According to the data of China’s green bond market, a spatial weight matrix is constructed and a panel data spatial Dobbin model is established to measure the spatial effect of the environmental protection effect of green bond issuance from the perspective of energy conservation and emission reduction. Findings/Conclusions The empirical results show that the issuance of green bonds can significantly promote enterprises to reduce carbon emissions and produce a significant environmental protection effect, and the indirect effect is much greater than its direct effect; it also reveals the reason that the environmental protection effect of the primary market is significant and that of the secondary market is not significant. Through the discussion of the reasons, countermeasures to make full use of the financial market and improve the environmental protection effect of green bonds are given.