Climate Investment Newsletter 11/2 - 11/9

Individual Deals and Market Watch

Asian GSSS bond issuance hits $600bn, finds report [Environmental Finance]

• More than $600 billion of green, social, sustainable and sustainability-linked (GSSS) bonds have been issued out of Asia, Environmental Finance Data shows. The region has issued $160 billion in such instruments so far this year, bringing the cumulative total to $614 billion.

Siemens Energy cleared to launch EUR-4bn Siemens Gamesa buyout [Renewables Now]

• Siemens Energy AG (ETR:ENR) has been authorised by Spain’s National Securities Market Commission (CNMV) to kick off a takeover offer for the 32.9% stake it does not already own in Siemens Gamesa Renewable Energy SA (BME:SGRE).

RobecoSAM biodiversity fund targets €3bn [Environmental Finance]

• RobecoSAM Biodiversity Equities "targets alpha generation opportunities in the structural growth trend created by governments, corporates and consumers that is increasing focus on supporting biodiversity and the transition to a nature-positive world".

$1.8 billion bet on the carbon markets [Carbon Credits]

• Oak Hill Advisors, made one of the largest timberland purchases in the U.S. Oak Hill is a subsidiary of T. Rowe Price Group Inc. They can tap into the $57 billion of assets under management to get the $1.8 billion for 1.7 million acres of forest it bought from The Forestland Group (TFG).

AIIB ties up with GEAPP to mobilise USD 1bn for renewables in Asia [Renewables Now]

• The Asian Infrastructure Investment Bank (AIIB) and the Global Energy Alliance for People and Planet (GEAPP) will be partnering to mobilise up to USD 1 billion (EUR 994m) in funding for green energy transition and renewable energy projects in Asia and beyond.

AllianzGI to launch $1bn blended debt climate strategy [Environmental Finance]

• Allianz Global Investors plans to launch a $1 billion blended debt strategy focused on climate solutions in emerging markets. Launched in partnership with its parent company Allianz Group and a regional development finance institution, the Allianz Climate Solutions Emerging Markets (ACSEM) Strategy is expected to invest alongside development finance institutions (DFIs) in Paris-aligned projects.

BXP Prices $750 Million Offering of Green Bonds [Business Wire]

• The estimated net proceeds from the offering are expected to be approximately $743.5 million. BPLP intends to allocate an amount equal to the net proceeds from the offering to the financing and refinancing of recently completed and future “eligible green projects” in the United States.

IFC’s first green kangaroo bond raises 900 million Australian dollars (~$576mln USD) for climate-friendly projects [IFC]

• The landmark fixed-rate bond due to mature in May 2027 is the largest Australian dollar green bond issued by a multilateral development bank in 2022 and is also IFC's largest Kangaroo transaction in over a decade.

Namibia secures $544 million in climate finance at COP27 [WHBL]

• The Dutch grant is from infrastructure funding vehicle Invest International, while the facility from the European Investment Bank is to build green hydrogen and renewable energy projects in Namibia.

KKR invests $400m in Indian decarbonisation firm [Environmental Finance]

• KKR will invest $400 million in Serentica Renewables, an Indian clean energy provider for hard-to-abate industries.

Brookfield Renewable to issue C$400 million (~$298mln USD) of green bonds [Newswire]

• The Notes will represent Brookfield Renewable's sixth corporate-level green bond in Canada. Brookfield Renewable intends to use the net proceeds from the sale of the Notes to repay indebtedness incurred by Brookfield Renewable to fund Eligible Investments (as defined in Brookfield Renewable's Green Bond and Preferred Securities Framework dated February 2020).

TIR Europe targets $250mln for US sustainable timber fund [Agri Investor]

Verkor raises 250 mln euros to fund EV battery megafactory [Reuters]

• French battery startup Verkor has raised 250 million euros ($248 million) from investors to fund a battery "megafactory" on its way to building a much larger plant to produce batteries for its customer Renault (RENA.PA), the company said

Solugen raises over $200 million Series D to reimagine the chemistry of everyday life [Cision]

Chinese lithium-ion battery materials maker Kuntian raises $137mln [Deal Street Asia]

• Hebei Kuntian New Energy, a Chinese manufacturer of anode materials used in lithium-ion batteries, has secured over 1 billion yuan ($137mln) in a strategic investment from investors including Sinopec Capital to expand its production capacity.

Carbon blockchain company partners with NZ company to launch $100 mln climate fund [Carbon Pulse]

Singapore passes bill to increase carbon tax, setting trajectory for S$50-80/t by 2030 [Carbon Pulse]

Brazil, Indonesia and DRC in talks to form ‘Opec of rainforests’ [The Guardian]

• The big three tropical rainforest nations – Brazil, Indonesia and the Democratic Republic of the Congo – are in talks to form a strategic alliance to coordinate on their conservation, nicknamed an “Opec for rainforests”, the Guardian understands.

Africa Carbon Markets Initiative launched at COP27 [Environmental Finance]

• An initiative to “dramatically” expand Africa’s participation in the voluntary carbon markets has been launched at COP27. In its roadmap, ACMI said that, by 2030, it aims to establish the market through demonstrated methodologies (e.g., cookstoves, nature); by 2040, expand the proportion of removals credits (vs avoidance); and, by 2050, establish carbon credits as one of Africa’s top export commodities.
• ACMI estimated that Nigeria itself can generate as much as 30 million carbon credits every year by 2030. Using a price of $20 dollars per credit, the country’s VCM will be worth over half a billion dollars per year. [Carbon Credits]

Macro Commitments

U.S. and UAE sign strategic partnership deal to spur $100 billion in clean energy investment [CNBC]

• The United States and United Arab Emirates announced the signing of a strategic partnership that will see $100 billion mobilized to develop 100 gigawatts of clean energy by 2035.

Iberdrola to spend EUR 17bn on renewables in 2023-2025 [Renewables Now]

• Spanish utility Iberdrola SA (BME:IBE) will invest around EUR 17 billion (USD 17.1bn) in renewables in 2023-2025 to reach about 52 GW of total installed clean power capacity by the end of the planning period, the company said in the Capital Markets Day presentation

COP27: UK to triple climate adaptation budget to £1.5bn as Rishi Sunak unveils new funding for nature and energy [edie]

• Prime Minister Rishi Sunak announced a new package of climate finance measures at the opening day of COP27 (7 November) including tripling a climate adaptation fund, investing £90m into conservation projects, £65m to support local forest communities and new funding for clean energy innovation.

Gates Foundation gives $1.4 bln climate help to smallholder farmers [Reuters]

• The Bill & Melinda Gates Foundation has pledged $1.4 billion to help smallholder farmers cope with the impacts of climate change, part of efforts at global climate talks in Egypt to scale up supply of so-called adaptation finance.

Irish govt announces biggest ever forestry investment of €1.3bn [Leinster Leader]

• The Taoiseach, Micheál Martin, Minister of State with responsibility for Forestry, Senator Pippa Hackett, and Minister for Agriculture, Food and the Marine, Charlie McConalogue, November 3 announced the proposed investment of €1.3 billion in funding for the next national Forestry Programme.

World Bank approves $497 million in financing to lower South Africa's greenhouse gas emissions and support a just transition [All Africa]

• The World Bank Group Board of Executive Directors approved South Africa's request for a $497 million project to decommission and repurpose the Komati coal-fired power plant using renewables and batteries. The project will also create opportunities for the affected workers and communities. This is in line with the government's efforts to transition the country toward a low carbon development path with reliable, affordable, and sustainable energy for all

ADB announces $200 million goal for water resilience program [ADB]

• The Asian Development Bank (ADB) today joined with partners at COP27 to announce the ambition to mobilize more than $200 million from 2021 to 2025 to build water and sanitation resilience and security in Asia and the Pacific.

The Global EverGreening Alliance and Climate Asset Management, announce partnership to deliver a landmark $USD 150 million nature based carbon programme in Africa. [Global EverGreening Alliance]

• The Restore Africa programme aims to restore more than two million hectares of land and directly support two million smallholder farms in the next five years across six African countries – Kenya, Ethiopia, Malawi, Tanzania, Uganda, and Zambia. The programme is an innovative community-led model that connects the local efforts of farmers on the ground with new revenue streams from global carbon markets.

UK pledges more than $115 mln to developing economies to tackle climate change [Reuters]

Pathways, Frameworks, Case Studies, Research, Climate Science

Climate fintech funding soars, totaling US$1.8b in H1 2022 [FinTech News]

• CommerzVentures, the corporate venture capital (CVC) arm of Commerzbank in Germany, has released its latest report on climate fintech, sharing findings of an analysis of 528 climate fintech startups across Europe and the US with scalable business models to provide an overview of the sector’s growth across geographies, sub-sectors and funding stages.

Australian $44-bln pension fund adopts EU climate reporting benchmarks to avoid exaggerated results [Carbon Pulse]

TNFD publishes pilot nature scenario 'narratives' [Environmental Finance]

• The TNFD requested feedback on its proposed scenarios to inform further guidance on them that it will publish in the fourth version of its beta framework early next year. Nature scenarios are "a story that describes a plausible future", it said.

$125 trillion needed for net zero by 2050: Citi study [Trade Arabia]

• A cumulative total of $125 trillion in capital investment is needed for the global economy to reach net zero by 2050, says a new Citi research released on Tuesday (November 8).

Developing countries ‘will need $2tn a year in climate funding by 2030’ [The Guardian]

• The cash will be needed so that poor countries can switch away from fossil fuels, invest in renewable energy and other low-carbon technology, and cope with the impacts of extreme weather, according to a report that was commissioned jointly by the UK and Egyptian governments, and presented at the Cop27 UN climate summit.
• It said the total annual investment requirement of developing countries would hit $2.4 trillion by 2030, with half coming from external financing and the rest from public and private sources in those countries. [Reuters]
• Adaptation finance for developing countries reached $29bn in 2020, an increase of 4 per cent compared with 2019, according to OECD data. But they would need between $160bn and $340bn annually by 2030 to fund adaptation measures, such as flood defences and early warning systems, according to UNEP analysis. [FT]

Analysis: US falling $32bn short on ‘fair share’ of $100bn climate-finance goal [Carbon Brief]

• The US should be paying nearly $40bn towards the $100bn climate-finance target, new Carbon Brief analysis shows. This is $32bn more than the estimated $8bn it actually gave in 2020.

Climate investments, estimated at $78 billion by 2050, will reap big dividends for Morocco -WB Report [The North Africa Post]

• The Morocco Country Climate and Development Report (CCDR), the first in a series of CCDR reports to be released in the MENA region, said total investment needed to put Morocco firmly on a resilient and low carbon pathway by the 2050s would amount to around $78 billion. This investment could be gradual, but the pay-off would be large, making Morocco more attractive for direct foreign investment and exports, plus boosting economic growth.

A just transition in the meat sector: why, who, and how? [SEI]

• This report sets out routes toward a just transition in the meat sector. It focuses on domestic meat markets in the Global North, maps out key stakeholders and identifies guiding principles for a just transition away from large-scale meat production and consumption.

Net-Zero Banking Alliance first progress report: significant achievement with over 50% setting intermediate decarbonisation targets [UNEPFI]

• The first progress report delivered by the NZBA since its launch in April 2021 aggregates the intermediate 2030 targets set by over 60 members of the Alliance and reiterates its requests for support from policymakers in helping deliver an orderly and ‘whole economy’ transition to net zero.

Scaling up strategies for net zero, nature positive and addressing inequality through NbS [wbcsd]

• New report focuses on Nature-based Solutions (NbS) in strategies for Net Zero, Nature Positive and addressing Inequality, and shares insights from the evolution of Natural Climate Solutions (NCS) as part of corporate action on climate

Biden administration announces nature-based solutions to combat climate change [Jurist]

• The roadmap primarily employees US government agencies to carry out its goals. The Department of Housing and Urban Development (HUD) will receive $875 million in grants and loan authority to assist increases in home energy and water use efficiency. The Department of Agriculture is tasked with wetland and grassland conservation improving carbon sequestration.

$42trn investor group tells governments to act on methane pledge [Environmental Finance]

• 602 investors representing about $42 trillion in assets under management have called on governments ahead of COP27 to implement five policy actions, including committing to implement the Global Methane Pledge.

Smart Carbon Market to attain value of US$ 12 bn by 2031, TMR Study [Yahoo/Cision]

• In 2021, the smart carbon market size stood at US$ 3.1 Bn. Global market study on smart carbon is estimated to advance at a CAGR of 16.2% during the forecast period, from 2022 to 2031. It is predicted that by 2031, the global smart carbon market will touch valuation of US$ 12 Bn. One of the major elements that is anticipated to propel the development of the global smart carbon market is the growing emphasis that governments are placing on synthetic fuel.