Your Newsletter at a Glance
Commentary by C4C
In this week’s issue, Husk Power secures $103M to support community solar mini grids to Sub-Saharan Africa and South Asia, bringing funding to emerging markets/developing economies to $3.0bn. The Landbanking Group raises $11M in seed funding for a fintech-ish platform to invest in “nature equity”, which they aim to define as a new asset class. Egypt and Malaysia issue almost $1bn in green bonds, while total global government commitments run close to $4bn. NbS in agriculture receives $164.7M including AXA buying a leading bioinput player in Brazil.
A few critiques in the climate space:
- The UN gets raked with claims of censorship of methane emissions from agriculture and their role in climate change.
- 130 companies collectively representing $1tn in global annual revenues come together, pushing COP28 to schedule phasing out of fossil fuels.
- Over 200 health journals call on the UN and political leaders to recognize the climate and nature crisis as a singular global health emergency.
Climate and biodiversity finance headlines:
- Carbon Direct looks at the state of the VCM in their new report.
- Biodiversity measurements get some guidance via EU-funded project Align.
- ASN biodiversity fund claims the first measurement of positive nature impact by an investment manager.
- Read up on how the biodiversity market can learn from VCM’s mistakes.
Relevant research:
- Researchers from the University of Edinburgh and UNEP provide data showing protected African woodlands have an almost 7x effect on the sequestration rate of carbon when compared to unprotected areas.
- Archaeological evidence indicates that Indigenous Amazonians have been using a form of biochart to build fertile soils for hundreds of years.
- Sodium-based batteries are attracting capital and focus as an alternative to lithium, particularly for long duration applications.
Research and Knowledge Sharing
Grow your climate finance expertise
Climate
The future of sustainable aviation fuel depends on the 2023 Farm Bill [GreenBiz]
- Sustainable aviation fuel is emerging as the most viable path forward for a decarbonized aviation industry in the US, if the US 2023 Farm Bill provides adequate funding.
Carbon Direct announces the 2023 State of the Voluntary Carbon Market report [Carbon Direct]
- The 2023 State of the Voluntary Carbon Market report analyzes data from the four largest voluntary offset registries, the developing high-durability registries, and in-depth evaluations conducted by Carbon Direct on hundreds of carbon removal projects. Some key findings: removals-focused purchasers of carbon credits increased fivefold from 2021 through the first three quarters of 2023; the volume of retirements for carbon removal credits held steady at around eight million retirements for 2021 and 2022; and quality remains a key challenge across the market.
Firms are exploring sodium batteries as an alternative to lithium [The Economist]
- Unlike lithium, sodium is cheap and abundant and particularly suited to stationary energy applications. If you think it’s not a serious contender, consider that China has 34 sodium battery manufacturing facilities operating or in development.
Ikea and BT among 130 companies to push COP28 for a timeline to ditch fossil fuels [Financial Times]
- Ikea, Volvo Cars, eBay, Heineken, Godrej Industries, and more than 130 other businesses have urged world leaders to agree on a timeline to ditch fossil fuels when countries meet for the UN climate summit in Dubai next month.
The energy world is set to change significantly by 2030, based on today’s policy settings alone [IEA]
- IEA's new report, World Energy Outlook 2023, shows there are set to be almost 10 times as many electric cars on the road, with renewables nearing half of the global power mix, but much stronger policies needed for 1.5 °C. Not a surprise. BNEF has more fine grained forecasts on mobility, if you are looking for them.
Nature-based Solutions
Protected areas reduce deforestation and degradation and enhance woody growth across African woodlands [Nature]
- Researchers from the University of Edinburgh and UNEP-WCMC present a new study that shows protected areas have a positive effect on aboveground carbon, with stocks increasing faster in protected areas (+0.53% per year) compared to comparable lands not under protection (+0.08% per year) with 39% less deforestation and 25% less land degradation the unprotected areas. These results highlight the potential for protected areas to sequester aboveground carbon, although the authors caution that in some areas this may have negative impacts on biodiversity, and human wellbeing.
From carbon to nature: what the biodiversity markets can learn from the voluntary carbon market [Compensation Foundation]
- The biodiversity markets have enormous potential. However, there are risks involved if unregulated markets adopt harmful practices and neglect transparency. This white paper, from a Finnish project-based carbon sales platform, explores what the nascent biodiversity markets can learn from the voluntary carbon market, such as the similarities and differences between the biodiversity markets and the voluntary carbon market; lessons learned from the integrity of projects and credits in the voluntary carbon market; and insights on biodiversity claims.
‘First ever’ positive impact of a biodiversity fund measured by GFI's ASN Impact Investor's biodiversity fund [Carbon Pulse]
- Many thought leaders contributed to this baseline – biodiversity over an area equivalent to at least 3,000 hectares was supported by ASN Impact Investor’s biodiversity fund last year, according to the “first” measuring of positive nature impact by an investment manager. Each euro invested by the €30 million fund protected or restored the biodiversity over approximately one square meter throughout 2022 to a pristine condition, the investor estimated. For readers interested in biodiversity impact measurement per dollar, this is a click through. Includes case studies, deep dives, and UK recommendations.
EU-funded Align project launches biodiversity measurement guidance [Carbon Pulse]
- The EU Commission's Align program provided guidance for measuring biodiversity covering direct operations, supply chains, and ecosystem conditions. The players include UNEP-WCMC, Arcadis, Capitals Coalition and ICF. Resources flagged include EDNA Resources, The World Database of Protected Areas, Natural England’s Biodiversity Metric 4.0. They are forming a community of practice too.
Can biodiversity credits stem the extinction cascade? [Energy Monitor]
- With the world needing to invest $536bn annually to combat the biodiversity crisis, “bio-credits” could provide a vital stream of private finance. However, as carbon offsets have proved, a market-based system for nature conservation also presents a lot of challenges.
South Korea becomes second country after Denmark, to embrace national plan for plant-based foods [Vegconomist]
- Just ten days after the Danish government unveiled its national action plan for plant-based foods, South Korea’s Ministry of Agriculture, Food, and Rural Affairs unveiled a comprehensive plan to boost the plant-based food industry and encourage the adoption of alternatives to animal proteins.
General Mills and Walmart join forces to advance regenerative agriculture across 600,000 acres by 2030 [Walmart]
- The collaboration will seek to support farmers in practices that aim to improve soil health, water quality and carbon sequestration across their shared value chain
Ex-officials at UN farming body say work on methane emissions was censored [The Guardian]
- Former officials in the UN’s farming wing have said due to agriculture industry lobbying, they were censored, sabotaged, undermined and victimized for more than a decade after they wrote about the damaging contribution to global warming of methane emissions from livestock.
Indigenous Amazonians intentionally created fertile 'dark earth' [Phys.org]
- A study published in Science Advances and led by researchers at MIT, the University of Florida, and in Brazil aims to settle the debate over dark earth - black and fertile patches of ancient soils in hundreds of archaeological sites across the Amazon. The team has pieced together results from soil analyses, ethnographic observations, and interviews with modern Indigenous communities, to show that dark earth was intentionally produced by ancient Amazonians by interring charred biomass as a way to improve the soil and sustain large and complex societies. Researchers determined that carbon-rich material has been stable in the soil for centuries.
Time to treat the climate and nature crisis as one indivisible global health emergency [BMJ ]
- Over 200 health journals, including JAMA, BMJ, and The Lancet, call on the United Nations, political leaders, and health professionals to recognize that climate change and biodiversity loss are one indivisible crisis and must be tackled together to preserve health and avoid catastrophe. This overall environmental crisis is now so severe as to be a global health emergency.
Climate Finance ≥ $100M
Commitments
Egyptian government plans to issue $700M worth of green bonds in 2023 [Daily News Egypt]
- The Egyptian government plans to issue green bonds worth $700m through one of its entities under the Ministry of Electricity. Sources state the bonds will fund a green project that will benefit the private sector or involve a partnership with it, and that the International Finance Corporation (IFC) will act as an adviser and possibly underwriter for this issuance.
Australia state to invest $630M to ramp up renewable energy transition [Reuters]
- Australia's state of Victoria said it would invest an initial A$1 billion ($630 million) to help accelerate its energy transition to renewable power and support the switch of households away from natural gas for heating and cooking.
UK ‘adds’ £450M ($545.8M) to its climate-finance spending by changing definition [Carbon Brief]
- The UK has “added” around £450m to its climate-aid spending in developing countries by changing how it defines “climate finance” - expanding the activities that the UK classifies in this category to include payments into development banks and more money for the private sector.
Global Gateway: Team Europe and Cabo Verde present an investment package of €246n ($260.3bn) to boost green energy, sustainable transport and digital connectivity transformation [PR Newswire]
- President of the European Commission, Ursula von der Leyen and Prime Minister of Cabo Verde, Ulisses Correia e Silva presented a package of investments worth €246 million to boost the green transition, sustainable transport, and digital connectivity in the country.
Deals
Vineyard Wind 1 closes $1.2bn tax equity financing [Renewables Now]
- Vineyard Wind 1, the US' first commercial-scale offshore wind project is finally starting construction with CIP and Avangrid as investors and has closed a USD-1.2-billion tax equity package with three major US banks. If you have not been following this story, it took from 2017 to get here following the demise of a different project in the same general area, Cape Wind which was started in 2009 and killed by permitting hurdles in 2016. Offshore wind in the US faces stiff headwinds getting through environmental permitting and negotiating who will pay for interconnect costs and then comes the politicalization – see related Harvard Political Review story.
World Bank approves $1bn loan to help South Africa tackle power crisis [Reuters]
- The World Bank approved a $1 billion loan to help South Africa reform its energy sector, as the country tries to overcome regular power cuts that have curbed economic growth. The bank wants to support the country's reforms to split struggling power firm Eskom and to transition to a low carbon economy.
Green Climate Fund confirms $736M for new projects and readiness strategy to accelerate climate action [Green Climate Fund]
- The Board of the Green Climate Fund (GCF) concluded its thirty-seventh meeting in Tbilisi, Georgia. During the three-day meeting, the Board approved 15 proposals totaling USD 736.4 million to fund new projects in developing countries. GCF’s overall portfolio now stands at USD 13.5 billion in GCF funding, with a total value including co-financing of USD 51.8 billion, covering 243 projects across the developing world.
Enel signs agreement to sell a geothermal and solar portfolio in United States to ORMAT ($271M) [Enel]
- Enel Green Power North America Inc., has signed an agreement with ORMAT Technologies Inc. for the sale of a renewable asset portfolio in the US for $271M. The portfolio consists of approximately 150 MW of operational geothermal and solar facilities.
California Distributes $192M for more clean transit [CA.gov]
- Governor Gavin Newsom announced that Caltrans approved $192 million in California Climate Investment funds for 136 public transportation projects that will cut pollution and create more affordable transportation options, especially for disadvantaged communities.
Innergex Completes its Partnership with Crédit Agricole Assurances in France ($137.0) [Innergex]
- Innergex Renewable Energy Inc. and Crédit Agricole Assurances, in connection with Crédit Agricole Centre-Est, announce they have completed the previously announced long-term partnership. The partnership allows Crédit Agricole Assurances to gain a 30% minority interest in Innergex's portfolio in France, representing a €129.5 million investment. Innergex France is a French renewable platform and a subsidiary of a leading pure play renewable energy group.
Eavor closes $132M equity round led by OMV [Renewables Now]
- Eavor Technologies Inc, a Canadian developer of a globally scalable geothermal closed-loop technology, has successfully closed a CAD-182-million (USD 132m/EUR 125m) equity round led by the Austrian oil and chemicals group.
Biden-Harris administration announces ~$128M for environmental justice projects in communities across the country as part of Investing in America Agenda [EPA]
- The U.S. Environmental Protection Agency (EPA) announced nearly $128 million to fund 186 projects across the country that advance environmental justice as part of President Biden’s Investing in America agenda. The organizations, which EPA has selected through its Environmental Justice Collaborative Problem Solving Cooperative Agreement and Environmental Justice Government-to-Government programs, will use the funds to ensure disadvantaged communities that have historically suffered from underinvestment have access to clean air and water and climate resilience solutions in alignment with the Biden-Harris Administration’s Justice 40 Initiative.
Biden-Harris administration announces $120M WIFIA loan to strengthen climate resilience in Florida [EPA]
- The U.S. Environmental Protection Agency (EPA) announced a $120 million Water Infrastructure Finance and Innovation Act (WIFIA) loan to the City of Fort Lauderdale, Florida. This funding will improve stormwater management and bolster climate resilience in the city’s most flood-prone neighborhoods.
Organic flow battery firm CMBlu gets €100M ($105.8M) investment [Energy Transition News]
- Germany-headquartered organic flow battery company CMBlu has secured €100 million from technology and construction firm Strabag. Alongside the equity investment, Strabag and CMBlu have also signed a preferred partnership agreement. CMBlu’s technology is a redox flow battery which uses an electrolyte sourced from organic materials, which it said are cost-effective, environmentally friendly and secure. By contrast, most flow batteries use vanadium salts in sulfuric acid as the electrolyte.
Husk Power secures $103M in equity ($43M) and debt ($60M) to supercharge growth of community solar mini grids in rural Sub-Saharan Africa and South Asia [Husk]
- Husk Power Systems announced that it has closed $43 million in Series D funding. In addition, Husk has leveraged the Series D equity to secure an additional $60 million in debt from several finance institutions, including the European Investment Bank (EIB), and the International Finance Corporation. (IFC). The deals support Husk in electrifying communities in rural Sub-Saharan Africa and South Asia with an AI-enabled platform of renewable energy services. The equity funding includes new investors STOA Infra & Energy, the US International Development Finance Corporation (DFC) and Proparco, as well as existing investors Shell Ventures, Swedfund and FMO.
Nature-based Solutions ≥ $1M
Commitments
Commission approves €742M ($785.0M) Czech State aid scheme to support sustainable forest management [EU Commision]
- The European Commission has approved, under EU State aid rules, a €742 million (CZK 17.4 billion) Czech scheme to support sustainable forest management. The measure will contribute to the achievement of the objectives of the Common agricultural policy by strengthening forest environmental protection.
Canadian province launches old growth forests crowdfunding venture with C$300M ($217M) [Carbon Pulse]
- The government of British Columbia has launched a crowdfunding initiative for protecting old growth forests with C$300 million ($217 mln) of initial capital. The administration for the province and non-profit BC Parks Foundation each committed to contributing C$150 mln to the fund, which is slated to support Indigenous guardian initiatives, among other programs. The fund will be managed by BC Parks Foundation but overseen by an independent committee, half of whom will be First Nations representatives.
Deals
Malaysia to create biodiversity assets in carbon market through new finance instrument ($210M) [Carbon Pulse]
- The government of Malaysia will use a newly launched biodiversity instrument to fund reforestation and forest restoration by generating carbon credits. Environment Minister Nie Nazmi said the RM1 billion ($210 million) biodiversity sukuk – a sharia-compliant Islamic finance credit instrument similar to a bond – would go towards accelerating work to protect the nation’s biodiversity.
Brazil bio input leader Biotrop acquired by AXA's impact fund partner($127.0M) [AXA]
- Tikehau Capital, AXA’s impact fund partner, has announced an initial investment of 120 million euros in Biobest, a Belgian group specializing in alternative agricultural inputs and world leader in the fight against plant pests and diseases. This injection of capital will finance the acquisition of Biotrop, a Brazilian company specializing in organic solutions for nutrition and the protection of row crops including soybeans, sugarcane and corn.
Nature restoration fund hits £30M ($36.4M) milestone for Scotland [Scottish Greens]
- Scottish Green Minister Lorna Slater has revealed some 150 projects across the country have already shared in £30m of investment allocated from the Scottish Government's Nature Restoration Fund. Coastal areas, marine habitats, and work on invasive species, habitat and species restoration and crucially, on health and well-being of local communities, have all benefited from the fund. Scotland's existing two National Parks have also received support, alongside projects across all 32 of Scotland's council areas.
EU launches an Initiative to develop food systems and blue economy in Mauritania ($25.1M) [PR Newswire]
- European Commission President Von der Leyen and the Mauritanian President Mohamed Ould Ghazouani have launched a new Team Europe Initiative, as part of the EU's positive Global Gateway offer, to support investment in the energy transition and decarbonization of Mauritania's economy and towards green hydrogen. In addition, €13,7 million was committed to promoting sustainable food systems and access to quality and affordable food by strengthening value chains and economic operators; and €10 million was committed to promoting the Blue Economy in Mauritania, in particular, eco-friendly fishing systems and strengthening fisheries' value chain.
John Deere Foundation announces $14M in grants towards nature-based solutions [Cision]
- The John Deere Foundation announced a series of grants totaling $19 million for increasing access to food, uplifting resource-constrained farmers, and supporting global food systems, with $14M going towards NbS. One Acre Fund received $7.5M to support farmers in their endeavors including soil health, and The Nature Conservancy received $6.5 million to promote natural climate solutions in key regions across the globe.
The Landbanking Group wants to make nature a balance sheet-grade asset, raises $11mn in seed funding [Business Insider]
- The Landbanking Group picked up $11 million in seed funding. The round was led by High Impact Fund BonVenture together with André Hoffmann. Venture capital funds 4P Capital, Vanagon, and Planet A will contribute their expertise in marketing, ReFi, and impact measurement. The funds will allow The Landbanking Group to expand from the agrifood sector to infrastructure, energy, and financial services, as well as continue their expansion from managed land to conservation.
FarmInsect's €8M ($8.5M) funding boosts scale-up of insect-based livestock feed technology in a Series A [Tech EU]
- FarmInsect, a German agritech startup, raises €8 million to scale up sustainable livestock feed production using insects, offering a cost savings solution to livestock farmers. The round was led by Sandwater alongside Bayern Kapital’s growth fund, the Minderoo Foundation’s Strategic Impact Fund, and the European Innovation Council Fund.
Service awards more than $6.4M in tribal wildlife grants to advance shared conservation goals and natural heritage, and cultural priorities [USFWS]
- The U.S. Fish and Wildlife Service is awarding more than $6.4 million to federally recognized Tribes to benefit fish and wildlife resources and their habitats. This year’s funding will support 36 Tribes for conservation projects across 17 states, benefiting a wide range of wildlife and habitat, including species of cultural or traditional importance to Indigenous communities.
Ksh 750M ($5.0M) blue economy project is launched in Kilifi, Kenya [Kenya News Agency]
- The government announced ReSea, a $5M blue economy project that is set to benefit more than 50,000 households in Kilifi County. The project aims at enhancing the climate and socio-economic resilience of households along Kenya’s coastline, from Takaungu in Kilifi South Constituency to Marereni.
CarbonFarm Technology lands $2.6M to decarbonize rice through satellite-verified carbon credits [Ag Funder News]
- Paris, France-based CarbonFarm Technology has raised a €2.5 million ($2.6 million) seed round to help decarbonize rice farming through satellite-verified carbon credits. The round included participation from Racine2, operated by Serena and makesense; TechMind, Ponderosa, AgFunder, Climate Capital, and BPI France. CarbonFarm Technology will use the new funds to expand across the world’s biggest regions for rice cultivation including Asia, Africa and South America.
Amatera raises $1.6M to expand climate-smart crop breeding platform, starting with coffee [Ag Funder News]
- Amatera, a French startup developing climate-smart perennial crops including a new coffee variety with the resilience and yields of Robusta and the taste of Arabica, has closed a €1.5 million ($1.6 million) pre-seed round led by PINC, the venture arm of food and beverage co Paulig. Amatera is using plant cell culture (growing plant cells in vitro in culture rather than growing mature plants in water or soil) to develop its varieties, inducing spontaneous genetic variation using physical and chemical approaches, but without deploying gene editing or traditional GM techniques.