• Contact us
  • Tiếng Việt
    Post
    Global Climate Partnership Fund

    Snapshot

    Total Amount

    $200 million

    Financing Mechanisms

    Co-financing , Loan , ODA , Risk management , Technical assistance

    Qualifying Projects

    Mitigation, Energy , Energy Efficiency , Infrastructures , Low-Carbon , Renewable Energy

    Eligibility

    Energy efficiency, renewable energy and technical assistance in the key focus countries: Brazil, Chile, China, India, Indonesia, Mexico, Morocco, South Africa, the Philippines, Tunisia, Turkey, Ukraine and Vietnam

    Funding Objectives

    The Global Climate Partnership Fund (GCPF) aims to enable environmentally friendly economic growth in developing countries, particularly those experiencing rapid growth where demand for energy is rising and financing options for energy investments are not keeping pace with the need for investment.

    To address this concern, the GCPF will look to accomplish three goals:

    1. Contribute to the mitigation of climate change: The GCPF will prioritize countries with the largest energy consumption, the most significant greenhouse gas emissions and the highest potential to increase efficiency throughout the production and use of energy.
    2. Achieve economic sustainability of the Fund: GCPF will pursue its environmental goals by offering funding for energy efficiency and renewable energy projects, mainly by refinancing local financial institutions and in the future by (co-)investing directly. By financing economically sound projects, the GCPF will ensure a sustainable and revolving use of its means. The Fund also supports the creation of employment by fostering investments for SMEs and private households.
    3. Catalyse private and public capital into climate financing: Leveraging additional private sector investment will only become possible once the first two objectives are underway. The GCPF's public-private partnership structure and the experience of its stakeholders will be highlighted to bring additional capital into an area where financial flows are currently insufficient to adequately contribute to the mitigation of climate change.

    Financing Mechanisms

    The Global Climate Partnership Fund targets investments into emerging and developing economies across the world, with focus countries in all developing regions: Brazil, Chile, China, India, Indonesia, Mexico, Morocco, South Africa, the Philippines, Tunisia, Turkey, Ukraine and Vietnam.

    Beneficiaries of GCPF funding are ultimately end-users like households, homeowner associations, leasing companies, SMEs (including ESCOs and small renewable energy companies) as well as municipal entities, all of which are established and have primary operations in the locations of the target countries, and which require financing in order to improve energy efficiency performance or to produce renewable energy.

    To reach its final beneficiaries, GCPF can pursue two types of investments:

    • Investments into Financial Institutions: These include local commercial banks, leasing companies and other selected financial institutions that either finance or are committed to financing projects of the Final Beneficiaries meeting the eligibility criteria of GCPF.
    • Direct Investments: These comprise project devleopers, energy service companies (ESCOs), small scale renewable energy and energy efficiency service and supply companies that serve energy efficiency and renewable energy markets in the target countries.

    Application Procedures

    The GCPF follows two different tracks for cases of investments in Financial Institutions and for cases of Direct Investment.

    Financial Institutions

    Step 1: Selection

    The goal of the Fund is to select Financial Institutions that acknowledge the long term business opportunity of providing financing to sustainable energy projects, with a particular focus on SMEs and private households. All proposed Financial Institutions will have to comply with a set of eligibility criteria as described in the Issue Document and detailed in the Investment Guidelines of the Fund.

    By completion of the due diligence, the Investment Manager will outline whether the Financial Institution requires technical assistance in order to obtain GCPF funding. Therefore, if necessary, an approval of the Technical Assistance Facility Committee will be sought prior to proceeding with negotiations of the loan agreement.

    Step 2: Loan facility negotiation

    The negotiation process will be initiated upon completion of the due diligence process. It will take place based on the assumption that the Investment Committee will approve the investment. To maintain this assumption, all serious negative findings revealed during the due diligence process will be communicated to the Investment Committee prior to its final decision making. 

    Step 3: Loan operations

    Upon approval by the Investment Committee, the Investment Manager will prepare an execution version of the loan agreement. A legal check of the final loan agreement will be prepared by the Fund’s legal adviser.

    Step 4: Monitoring and reporting

    On a quarterly basis, the FI will provide the Fund with sub-loan reports, which include CO2 monitoring and reporting as well as its quarterly financial information. On an annual basis, the FI will provide the Fund with its annual financial information as well as with its environmental and social reporting. To ensure adequate CO2 monitoring and reporting a local Country Technical Representative (CTR) will be made available to Partner Institutions. They will also be able to provide technical expertise for projects, which might require additional technical knowledge, e.g. due to energy audits performed by third parties.

     

    Direct Investment

    Step 1: Project sourcing

    Direct investments embrace projects in renewable energy and energy efficiency sectors. The Investment Manager will source projects actively from global and local ESCOs, manufacturers of equipment and/or project developers. In addition, the Investment Manager will offer local financial institutions to co-finance projects from their pipelines, providing another source of projects.

    All projects should ideally have a promoter effect for the local sustainable energy culture, be integrated into the local economy and comply with relevant environmental and social standards. The Fund will only consider commercially proven technologies (eg. wind, solar and biomass) or require a qualified technical opinion by a third party for other technologies. Energy efficiency projects should ideally be in the sector with the highest energy use in the country.

    Step 2: Project evaluation

    Project evaluation will first focus on applicable risk ratios and risk-return considerations. The Fund will also analyze whether the Fund’s environmental and developmental objectives are met prior to assessing the project’s legal, financial and technical specifications. If necessary, the Investment Manager might collaborate with the counterparty to identify more feasible financing structures. 

    Subject to a successful outcome of this analysis, the project will be proposed to the Investment Committee.

    Step 3: Project approval and disbursement

    Upon approval by the Investment Committee, the Investment Manager will prepare an execution version of the loan agreement. A legal check of the final loan agreement will be prepared by the Fund’s legal adviser.

    Step 4: Monitoring and reporting

    The Investment Manager will ensure that all projects comply with the terms and conditions agreed upon prior to the investment. This includes regular (quarterly and annual) review of financial, social and environmental performance. Potential work-out scenarios, restructurings, terminations and any other potential follow-up issues will be performed by the Investment Manager.

    Project Types

    http://climatefinanceoptions.com/cfo/images/hide-icon.gifhttp://climatefinanceoptions.com/cfo/images/show-icon.gif

    As discussed above, the GCPF will consider two types of investment projects, those that refinance local financial institutions and direct investments in the energy sector via ESCOs, project developers and small scale energy service and supply companies. The GCPF focuses on energy efficiency and renewable energy investments in countries that have high energy demand now and in the foreseeable future in order to make as large an impact as possible.

    Due to the diversity of potential projects, there is no particular pre-selection of technologies or regions for Direct Investments.

    Decision-making structure

    http://climatefinanceoptions.com/cfo/images/hide-icon.gifhttp://climatefinanceoptions.com/cfo/images/show-icon.gif

    The Fund’s Shareholders are represented by the Board of Directors, which oversees the Fund’s activities and is responsible for strategic decisions. The Board of Directors is the legal representative of the Fund. In compliance with GCPF's founding documents and applicable laws and regulations, it has an exclusive power to administer and manage the Fund.

    The Board of Directors appoints the Investment Committee which approves investment decisions proposed by the Investment Manager (Deutsche Bank) and monitors the other activities of the Investment Manager.

    The Investment Manager conducts the Fund’s business on behalf of the Board of Directors and the Investment Committee. The Investment Manager also manages the Technical Assistance Facility at arm’s length, an activity overseen by the Technical Assistance Facility Committee.

    The Technical Assistance Facility Committee represents the Facility’s Donors and the Investment Committee, in order to ensure that the Fund’s technical assistance directly supports Fund’s objectives and investment activities.

    The GCPF was initiated by the Government of Germany and KfW Bankengruppe, with additional investments from the International Finance Corporation (IFC) and the Government of Denmark.

    Project Examples

    http://climatefinanceoptions.com/cfo/images/hide-icon.gifhttp://climatefinanceoptions.com/cfo/images/show-icon.gif

    Sekerbank (Turkey): The Global Climate Partnership Fund provides a $25 million senior loan facility to the Turkish commercial bank Şekerbank. The loan is tied to onlending to Şekerbank's EkoKredi product line, which provides financing to Turkish private households, homeowners, as well as small and medium-sized enterprises (SME) seeking to improve energy efficiency. Clients use the EkoKredi loans e.g. for the insulation of buildings or the installation of small-scale renewable energy solutions, such as solar water heaters.

    Links

    http://climatefinanceoptions.com/cfo/images/hide-icon.gifhttp://climatefinanceoptions.com/cfo/images/show-icon.gif

    GCPF homepage

    ©2012 Climate Finance Options. All Rights Reserved.
    Developed by MPI-UNDP-WB Address: 6B Hoang Dieu street, Ba Dinh district, Ha Noi
    Phone:0437.430.160
    Contact: Ms Dieu Trinh: trinh4mpi@gmail.com
    Legal Information & Privacy Policy