Climate Investment Newsletter 9/28 - 10/4

A selective overview of what you may have missed

Lightsource bp has successfully closed on a $285 million financing package for its Bighorn Solar project, which will be located on EVRAZ Rocky Mountain Steel mill property in Pueblo. Xcel Energy, as the electrical provider for the steel mill, will purchase the power generated by the solar facility under a long-term contract with Lightsource bp.

Pension giant Aviva plans to overhaul its auto enrollment 'default' fund to meet a 2050 net zero carbon target, and to put £5billion in climate-friendly investments in the next 18 months.

Aqua-Spark (“the Fund”), the first investment fund focused on sustainable aquaculture, announced an investment in Shiok Meats (“Shiok”), the world’s first cell-based crustacean meat company based in Singapore.

This investment focus, Pimco said, would allow European investors to move beyond their traditional areas of green bonds. The new fund will seek to capitalize on a diversified range of bonds supporting climate change solutions while minimizing climate-related risk.

Investors are testing out the EU Taxonomy. More than 40 asset managers and pensions have implemented the taxonomy in their own portfolios, seeking to learn and share how best to measure investments that are eligible for the taxonomy and potential gaps in the data-collecting process and other issues.

High-tech greenhouse grower AppHarvest ticks the boxes for high impact and high profile. Sustainable agricultural production. Coal-country job creation. Bold-faced name investors and board members like Martha Stewart, J.D. Vance and Inclusive Capital’s Jeffrey Ubben.

Fifty-five firms have committed to a framework released Thursday for setting climate goals specific to mortgages, bonds and other asset classes in their portfolios, said the Science Based Targets initiative, a consortium that developed the framework.

Climate adaptation notes to fund water infrastructure. Rural prosperity bonds for sustainable agriculture. Portfolios of distributed solar projects for schools and health clinics in Africa. The Global Innovation Lab for Climate Finance introduced eight new financial solutions that “address the climate emergency while providing much-needed sustainable recovery opportunities for overcoming the COVID-19 pandemic economic shock,” said the Lab’s Barbara Buchner.

After five years of sustained pressure that saw students protest and graffiti on ancient buildings, Cambridge University has committed to divesting its endowment from fossil fuels in a more comprehensive way than its peers have done so far.

PepsiCo announced Sept. 21 a new target to source 100% renewable electricity across their owned and controlled operations globally by 2030 and across their entire franchise and third-party operations by 2040.

The Swedish bank that helped usher in the era of green bonds may be just months away from introducing a new kind of sustainable finance to its home market.

Octopus Energy Ltd., the U.K. green power provider, bought U.S. startup Evolve Energy as part of a $100 million push into the American market.
The company hopes to attract millions of customers as it gets a foothold in the Texas market. It’s the latest step in Octopus’s plan to expand globally, driving down consumer prices with low-cost renewable power.

S&P Global dropped companies generating more than 5% of their revenues from thermal coal from its environmental, social and governance, or ESG, index.
Among those delisted: Duke, Dominion, American Electric Power, Xcel, WEC Energy, DTE Energy, PPL, and CMS Energy. “Thermal coal companies may now be counted among this lowest common denominator of “unsustainable” investments, said S&P, citing a shift in investor perception.

The decision by United Nations’ Principles for Responsible Investment (PRI) to throw out five members for insufficient dedication to environmental, social and governance (ESG) principles on Monday.

Volkswagen and its Chinese partners will pour €15bn into electric vehicles in the country over the next four years as competition intensifies to sell low carbon cars in the world’s largest auto market.

Transition finance has garnered a lot of attention, but the challenge of delineating what exactly it is remains unresolved. Three recent reports try to balance the need for the definition to be both broad enough to be inclusive, yet specific enough to protect the instruments from claims of greenwashing.

MetLife Investment Management (MIM) plans to make $20 billion of green investments – mostly green buildings and renewable energy – over the next decade.

The alternatives investment arm of BNP Paribas has raised €80 million ($93 million) at first close of a private equity fund of funds that will target measurable positive impact alongside financial returns.

Pension funds in Iceland have indicated their collective commitment to promoting sustainable development through investments, joining major players in the country’s financial sector by signing a letter of intent – alongside Prime Minister Katrín Jakobsdóttir.

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