Climate Investment Platform

Vision

The global energy system is already in an irrevocable transition to a more sustainable future; however, a greater acceleration centered on renewable energy and energy efficiency is needed immediately to keep global warming well below 2 degrees Celsius. Setting the world on a more climate-friendly path would require shifting investments away from fossil fuels towards sustainable energy and also investing an additional USD 15 trillion in the global energy system until 2050.

The accelerated transition towards a decarbonized global energy system can only be possible with improved access to finance in developing and emerging markets. As the funds available for sustainable energy has grown in number and volume, the global climate finance architecture has become increasingly complex. Constantly-evolving and fragmented nature of this architecture makes it quite complicated for both public and private project proponents to have access to climate finance. Consequently, clean energy projects, particularly small-to-medium scale projects in developing countries, remain unimplemented.

The Marketplace’s main vision is to declutter the climate finance architecture by offering both demand-side and supply-side solutions.

On the demand-side, the Marketplace would provide more visibility to sustainable energy projects and enhance the market transparency. By providing a one-stop portal, the Marketplace would make it easier for project proponents to navigate the climate finance architecture and facilitate their access to capital.

On the supply side, the Marketplace would enable both debt and equity capital providers to source and pre-screen projects in a cost-effective manner. The platform will be particularly effective for identifying small-to-medium scale projects in developing countries. The financiers would also be able to explore co-financing opportunities and increase their financial leverage through the platform’s syndication function. Ultimately, the Marketplace aims to channel funds to sustainable energy projects in streamlined manner.

Strategy

The Marketplace will primarily serve as an online matchmaking platform, connecting public and private project proponents with their potential financial and commercial partners.

On the demand side, the marketplace for energy transition will be populated with more renewable energy and energy efficiency projects; providing a pipeline to potential financiers and therefore attracting more financial institutions to the platform. This would produce a virtuous circle and in return bring more projects to the platform. The marketplace will also offer an improved value proposition to project proponents; they would be able to use several tools and documents to bring their projects to full investment maturity.

On the supply side, the financial partners network will be broadened, covering both public and private financial institutions more extensively. Commercial banks, development finance institutions, bilateral and multilateral financial institutions, among others, will present their products and actively search for projects though the platform. Financial institutions would be able to capitalize on the syndication function offered by the platform to seek co-financing and achieve a higher financial leverage. The Marketplace also aims to harmonize the due-diligence processes by offering standardized products and documents, thereby bring down transaction costs and expedite financing timelines.

Building on the Marketplace’s project pipeline, several regional matchmaking forums will be organized each year to connect project proponents with the creditors and investors in a more direct fashion. Prior to these forums, project proponents would be able to receive tailored support on their investor presentations.

Services

This track of the CIP will fulfil its mission and strategy through the following services under four main components:

4.1 Deal making and matching

  • Access to a structured, comprehensive and detailed database on RE, EE and EA projects seeking funding and/or technical assisstance, and public, private, and public-private financing instruments and technical assistance service providers looking for projects, including application processes and eligibility criteria information.
  • Matching of projects with financial instruments and project services. The matching process will be automatic, manual through a help desk, or through the organisation of national/regional matching events and other face to face meetings, according to the client’s preference.
  • Access to expert advice, tools and standardized due diligence processes, to help strengthen project proposals, as well as to minimize time and costs to achieve financial close

4.2 Syndication and blending

  • Access to syndication and blending services, including e-auction and e-procurement tools, where public and private entities can organise a transparent process to select projects, contractors or finance.