EIB, AllianzGI Announce $100 Mn for Renewable Projects at COP27

The Emerging Market Climate Action Fund (EMCAF) has announced a $25 million investment into Alcazar Energy Partners II, a fund providing early-stage equity financing to develop, construct and operate renewable energy projects in the Middle East, North Africa, Eastern Europe and Central Asia.

This commitment is in parallel to EIB Global, the dedicated arm for outside the EU of the European Investment Bank (EIB) Group, which provides $75 million to the fund.

The official statement of EIB said that Alcazar Energy Partners II has a target size of $500 million and will invest in onshore wind and solar photovoltaic, with additional potential investments in hydropower, biomass or battery-based electricity storage or other low-carbon technologies.

EIB said that the Fund is expected to create 15.000 construction jobs and contribute to the installation of over 2 GW of new clean energy capacity, thereby saving 3.2 million tons of greenhouse gas emissions per year, generating clean energy to power over one million households.

Ambroise Fayolle, Vice-President, EIB, said, “To meet the Paris climate goals and strengthen global energy security, the world’s energy systems must decarbonise as soon as possible. To do this, the financial system needs to mobilise trillions of dollars from private sector green energy projects.”

Tobias Pross, CEO, AllianzGI, added, “Emerging markets are where the money for climate adaptation and mitigation is needed most and where it will have a much more immediate impact than in developed countries. I am proud that our EMCAF investments are now gaining traction on the ground in emerging markets – not just helping to fight climate change, but to support healthy economic growth in this region.”

Daniel Calderon, Managing Partner, Alcazar Energy, mentioned, “AEP-II is privileged to have the confidence of an outstanding group of public and private institutions to invest and develop in renewable energy projects, mobilising more than $2bn of foreign direct investment from OECD economies to build sustainable infrastructure where it is needed most.”

Launched during COP26 in November 2021 by the EIB and AllianzGI, EMCAF is an innovative blended finance vehicle with a €600 million target. The governments of Germany and Luxembourg, the Nordic Development Fund, Allianz, Folksam Group and the EIB are its anchor investors.I. During its summit in Elmau (Germany) in June 2022, the Group of Seven (G7) countries endorsed EMCAF as an example of a concrete innovative and market-led approach to mobilising private investments for climate-relevant infrastructure and to enhance multilateral finance and collaboration.

EIB said that EMCAF has already made its first investment in the adaptation focused ARCH Cold Chain Solutions East Africa Fund, financing temperature-controlled storage and distribution infrastructure in East Africa that aims to generate emissions reductions from post-harvest food loss.