Project detail - COOPERATIEF CONSTRUCTION EQUITY FUND U.A.

COOPERATIEF CONSTRUCTION EQUITY FUND U.A.

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Who is our client

Climate Investor One (CIO) is an innovative approach to infrastructure financing designed to accelerate the delivery of renewable energy projects in emerging markets. Climate Investor One is managed by Climate Fund Managers and currently combines two investment funds into one facility to finance renewable energy projects at specific stages of the project lifecycle. At an early project stage, Climate Investor One provides financial, technical, environmental, social development and structuring support through the CIO Development Fund. Climate Investor One then reduces the complexity associated with multi-party negotiations by equity financing a large part of construction through the CIO Construction Equity Fund. Once the project is operational, Climate Investor One seeks to have mobilised long-term debt financing through the future CIO Refinancing Fund with the objective of optimising the financing over the operational life of the project. CIO realized a first closing of the CIO Development Fund and CIO Construction Equity Fund of USD 412 mln in late June 2017. The Directorate-General for International Cooperation (DGIS) - Ministry of Foreign Affairs of the Netherlands, Atradius Dutch State Business, De Nederlandse Waterschapsbank N.V. (NWB Bank), Aegon Asset Management and FMO – all from the Netherlands – together with global partners from Norway (KLP), South Africa (Sanlam Investments Holdings) & the UK (Royal Borough of Windsor & Maidenhead Pension Fund), collectively form the cornerstone investors in CIO.

Funding objective

Climate Investor One invests in the development, construction and operation of approximately 20 new renewable energy projects in emerging markets worldwide, taking environmentally and social returns carefully into account in addition to the financial returns. Targeting Africa, Asia and Latin America, CIO will focus on Solar, Wind and Run-of-River Hydro renewable energy projects.

Why we fund this project

Born out of The Global Innovation Lab for Climate Finance - a global initiative that supports the identification and piloting of cutting edge climate finance instruments – Climate Investor One contributes to important goals of FMO and the Dutch Government as a large Donor in the project: 1) the initiative seeks to fast-track the development of renewable energy projects in emerging markets thereby contributing to the energy needs of the growing populations in these markets, whilst reducing an estimated 1.5mn tonnes of CO2 per annum and 2) Climate Investor One aims to mobilize an estimated USD 1bn in investment from donors, development institutions and importantly commercial investors. As co-founder and initiator of CIO, FMO has made a sizeable commitment to the CIO Construction Equity Fund and has also taken a stake in the fund manager Climate Fund Managers. Finally, the Dutch Government (DGIS) channelled an important donor commitment to the CIO Development Fund through one of the government fund , the Access to Energy Fund, managed by FMO. This donor commitment facilitates further unlocking of private sector capital.

Environmental and social rationale

Category A Fund, due to investments in high risk sectors (e.g. hydro-power), which will require strong ESG management throughout the whole project life-cycle. The Fund will invest in construction activities with higher probability of negative impacts. The risk profile of the projects under development is generally cat B+ but the investment scope also allows for category A investments to be made. The Fund ESMS is comprehensive and fully implemented, in accordance with the Responsible Investment Code and other requirements under the legal agreements. For E&S information and ex-ante disclosure of their investment, you can visit the Climate Investor One website (see hyperlink in right corner).

Website client
http://www.climateinvestorone.com
Country
Global
Sector
Energy
Signing date
1/1/2018
Total FMO financing
USD 2.50 MLN
Fund
FMO
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk Environmental & Social Category
(A, B+, B or C)
A