Almost $19bn in deals in climate and nature-based solutions | 8/21 - 8/25

‍Your Newsletter at a Glance

Three US carbon market players join forces to mobilize $500mn to NbS carbon. Mombak, a Brazilian restoration focused carbon project developer, hits the target of $100mn for their Amazon Reforestation Fund with LP contributions this week of $35mn. Dealflow in low carbon energy tracks at $8.8bn across four continents. Alternative proteins bring in close to $0.5bn as a recent paper states new food policy is needed to make the shift away from traditional animal-based products.

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Some highlights:

• E.on issues $1.5bn green bond and Northvolt secures $1.2bn its battery plant in Canada.
• Follow on investment in an eDNA leader
• India steps up in green ammonia and green hydrogen
• South Korea’s relationship with food waste sets a global example
• Farmland LP gets to fund III for regen ag transition

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This issue covers $15bn in deals and commitments to climate finance around the world, with India capturing a fifth of that. Nature-based solutions are up $0.6bn from the previous week at $3.9bn in deal flow and commitments, with $3bn going to a wetlands conservation campaign. Read more details in the 26 deal and research highlights below.

Climate Finance 

Deals and commitments greater than $100mn

Climate Market Watch

ACME Group to invest nearly $3.3bn in green hydrogen project in Odisha [Business Standard]

• Indian renewable energy firm ACME Group will invest 270 billion rupees ($3.27 billion) to set up a green hydrogen and ammonia project at an industrial park in Odisha state.

ACWA and partners reach financial close on Al-Shuaibah solar projects ($2.2bn) [Power Technology]

• Saudi Arabia-based power generation company Acwa Power and its consortium partners reach financial closure on the 2.63GW Al-Shuaibah solar projects in Jeddah, Saudi Arabia. The Al Shuaibah 1 and Al Shuaibah 2 solar projects will have capacities of 600MW and 2.03GW respectively. The two projects will entail an investment of $2.2bn (SR8.3bn).

Prysmian selected as preferred bidder for BalWin1, BalWin2 and DC34 Power transmission cable projects in Germany ($4.9bn) [Prysmian Group]

• Prysmian Group has been selected by the TSO Amprion as preferred bidder for the two Offshore Grid Connection Systems BalWin1 and BalWin2 and the underground cable project DC34, with contracts valued in total at 4.5 billion Euros. The three projects are part of Germany’s plan to install 70 GW of offshore wind energy by 2045 and will support the transmission of the energy generated in the North Sea to the Western and Southern regions of the country.

Climate Research

Action needed to make carbon offsets from forest conservation work for climate change mitigation [Science]

• Researchers compare the actual effects of REDD projects with measurable baseline values to find most of them have not reduced deforestation significantly, and those that did had benefits substantially lower than claimed. Thus, most REDD projects are less beneficial than is often claimed.

Australia’s green bank CEFC confirms record renewables investment as race to net zero gathers momentum [CEFC]

• The CEFC confirms $1.9 billion in new investment commitments in the 2022-23 year, including a record $1.2 billion in renewable energy and grid-related investment commitments by Australia’s ‘green bank’, delivered despite challenging market conditions.

Superbatteries will transform the performance of EVs [Yahoo! Finance reposting The Economist]

• Carmakers have been looking for ways to replace the incumbent lithium-ion (Li-ion) batteries that power most modern electric vehicles (EVs) with more advanced “solid-state” versions. These new types of superbatteries have long promised faster charging and much greater driving range (like 500-600 miles), and after years of teething problems, the first solid-state Li-ion batteries are due to go into production within the next few years.

Climate change is likely to make sovereign debt more expensive—new study [Phys.org]

• Using AI to combine S&P credit ratings formula with climate-economic models to simulate the effects of climate change over time on sovereign ratings for 109 countries, researchers found that by 2030, 59 countries would see a deterioration in their ability to pay back their debts and an increased cost of borrowing as a result of climate change. Predictions for the year 2100 increase the number of affected countries to 81.
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Nature-based Solutions

Deals and commitments greater than $1mn

NbS Market Watch 

US trio to fund $500mn nature-based carbon projects to make 100mn carbon credits [Carboncredits.com]

• Three US companies – TPG Rise-backed carbon solutions provider Rubicon Carbon, commodity trading firm Freepoint Commodities, and emerging markets project development startup Imperative Global – team up to develop and fund a potential $500 million in nature-based carbon offset projects, potentially generating over 100 million carbon credits to create impactful results for developing nations.

Ducks Unlimited launches $3bn conservation campaign [Ducks Unlimited]

• A coalition of conservation organizations launch a $3 billion international fundraising campaign to protect and restore wetland habitats across North America, resulting in cleaner water for communities and wildlife. Ducks Unlimited, Inc., Ducks Unlimited Canada, Ducks Unlimited de México and Wetlands America Trust announced "Conservation For A Continent. Our Wetlands. Our Legacy." The campaign, launched in North America and devoted to landscape conservation, will fund ambitious projects to build back nature in Canada, Mexico, and all 50 US states.  It builds on the success of two prior multi-year campaigns for conservation, the last raised $2.34bn to conserve 2.2 million acres and concluded in 2018.

NbS Research

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How South Korea’s composting system became a model for the world [LA Times]

• Since South Korea banned land-filling food waste in 2005, followed by another ban on dumping its liquid byproduct into the ocean in 2013, the country has operated a comprehensive composting program that recycles almost all of its discarded food into fertilizer, animal feed or, in the case of Nanji Sewage Treatment Center, biogas.

Public policies and vested interests preserve the animal farming status quo at the expense of animal product analogs [One Earth]

• Research to improve animal product analogs is led by private companies and has only recently been supported by public funds. Public funding for the novel technologies is smaller than that for animal products by factors of 1,200 in the EU and 800 in the US. A shift in food policy is required to improve these technologies and produce sustainable alternatives to animal-source products, ultimately reducing the environmental impact of food systems.

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Climate Finance 

Deals and commitments greater than $100mn

Climate Individual Deals & Market Watch

E.ON issues €1.5bn ($1.6bn)  in green bonds for 2024 pre-financing

• E.ON, a European energy networks operator, issues 1.5 billion euros ($1.63 billion) in green bonds for 2024 pre-financing of sustainable projects focused on the energy transition. The bonds were issued in two 750 million-euro tranches, one maturing in March 2029 with a coupon of 3.75% and another in August 2033 with a coupon of 4%.

Northvolt raises $1.2bn amid plans to open battery plant in Canada [Financial Post]

• Northvolt AB raises US$1.2 billion from North American investors including BlackRock Inc. and the Canada Pension Plan Investment Board as the Swedish battery maker is said to be in talks to set up a new factory in Canada.

City commissioner Rubio introduces $750mn 'Climate Investment Plan' for Portland's vulnerable communities [KGW8]

• The $750 million plan, announced by Commissioner Carmen Rubio, comes out of the Portland Clean Energy and Community Benefit Fund. Roughly $474 million would be put toward improving energy efficiency in residential and commercial buildings, with a special focus on installing upgrades in low-income homes. Another $128 million would go to “transportation decarbonization,” with programs aimed at increasing access to e-bikes for disadvantaged communities. Around $70 million will go to funding green infrastructure, with special attention paid toward improving the city’s tree canopy, the lack of which can lead to the urban heat island effect. Roughly $41 million would be invested in green jobs and workforce development and another $20 million toward regenerative agriculture.

EDF announces the success of its senior multi-tranche green bond issue for a nominal amount of ₣325mn ($367.4mn) [Globe Newswire]

• EDF (BBB stable S&P / Baa1 stable Moody’s / BBB+ stable Fitch) raises 325 million Swiss francs in two tranches of senior Green Bonds. An amount equal to the net proceeds of the Green Bonds will be used to finance and/or refinance, in whole or in part, electricity distribution investments notably to adapt the grid to the needs of the energy transition.

Ameresco secures $300mn development and construction loan and extends maturity of senior secured credit facility term loan [Business Wire]

• Ameresco, Inc., (NYSE: AMRC), an energy efficiency and renewable energy company, announces the closing of a $300M senior secured loan facility with HASI (NYSE: HASI), an investor in climate solutions, to fund development and construction activity for clean energy assets.

Celsia enters Peru with a 218 MW wind project ($240mn) [Bnamericas]

• Celsia, the energy company of Grupo Argos, announces that it reached an agreement with the company Grupo Ibereólica Renovables to acquire the 218 MW Caravelí Wind Project, located in the Lomas District, province of Caravelí - Arequipa , Peru. It is estimated that the closing of the transaction will take place before the end of 2023 with the support of Ibereólica, at which time Celsia would begin the construction and start-up of the project. The total value of the project is estimated at USD 240 million.  

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Nature-based Solutions

Deals and commitments greater than $1mn

NbS Individual Deals & Market Watch

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Farmland lp launches $250mn third fund focused on organic and regenerative ag [Global Ag Investing]

• Farmland LP announces the launch of its $250 Vital Farmland III – its third and largest fund to-date – which will extend Farmland LP’s transformative mission for agriculture by shifting conventional farms into dynamic, sustainable, and organic operations.

EU approves €45mn ($48.6mn) sustainable forest management scheme [Agriland]

• The European Commission approved, under EU state aid rules, a €45 million Irish scheme to promote sustainable forest management. The scheme, which will run until December 31, 2027, is the latest part of Ireland’s new National Forestry Programme that aims to support landowners to implement economically, ecologically and socially sustainable forest management and use techniques.

Alt protein isn’t dead yet says ENOUGH as it raises $43.6mn to scale up mycoprotein production [AgFunder Network]

• Glasgow-based alt protein startup ENOUGH raises €40 million ($43.6 million) in a series C round led by World Fund and CPT Capital to expand production of ‘ABUNDA’ mycoprotein, a meat alternative made from fungi.

Carbon removal startup hits fund target to save Amazon forest ($35mn) [Carboncredits.com]

• The Amazon Reforestation Fund, formed by Brazilian startup Mombak, received two separate investments worth $35 million in total from Rockefeller Foundation and Canada Pension Plan Investment Board, reaching its $100mln target funding. Mombak’s reforestation project will plant native Brazilian tree species on degraded land, ensuring trees aren’t cut down for timber production. The project’s permanent carbon sequestration will create verified carbon removal credits that are tradable in carbon markets.

NatureMetrics raises £10mn ($12.6mn) as biodiversity moves up the ESG agenda [Sifted]

• London-based NatureMetrics, which is working on DNA sampling tech to track the species present in different locations, secures £9.8m in new funding, according to Companies House filings. 

£6mn ($7.5mn) investment to trigger new phase for UK nature recovery [The Wildlife Trusts]

• The Wildlife Trusts unveil a new programme which will accelerate UK nature recovery and help to reverse catastrophic declines in wildlife. £6 million from the Ecological Restoration Fund will support rewilding projects, the reintroduction of keystone species and better protections for marine and coastal habitats.

Jellatech raises $3.5mn to scale its cell-based collagen platform [Vegeconomist]

• US biotech startup Jellatech announces it has raised $3.5 million in an oversubscribed seed round to scale its manufacturing platform and introduce cell-based proteins to the global market. The round was led by Nordic-based VC firm byFounders. Other participants included Milano Investment Partners, Joyful VC, Siddhi Capital, Blustein, and others. Jellatech uses cellular agriculture to produce complex proteins at scale, including bio-identical bovine, porcine, and human cell-based collagen.

Government of Canada announces 2 billion trees funding ($2.2mn) to plant 300,000 trees in Prince Edward Island [Cision]

• Honourable Jonathan Wilkinson, Minister of Energy and Natural Resources, and the Honourable Steven Myers, Prince Edward Island's Minister of Environment, Energy and Climate Action, announce nearly CAD $3 million to plant trees that will permanently expand forest cover in P.E.I. and help recover areas damaged by Hurricane Fiona. By expanding both urban and rural forests through the planting of approximately 300,000 trees, Islanders will benefit from increased shade, expanded habitats for local wildlife, and improved air quality.

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