Beijing-headquartered Asia Infrastructure Investment Bank (AIIB) has approved a $50-million investment in the Southeast Asia energy transition-focused private equity fund established by Swiss investment firm SUSI Partners.
SUSI Asia Energy Transition Fund, which has a target size of $250 million, invests in renewable energy, energy efficiency, energy storage, and microgrid projects in developing Asia, with a special focus on Indonesia, Thailand, the Philippines, and Vietnam.
The targeted project portfolio will be diversified across 10-15 renewable energy and 10-15 energy efficiency projects. The first close of the fund is expected in the first quarter of 2020, with the final close by the third quarter of 2021.
In addition to the $50-million commitment, AIIB will also invest an additional $50 million alongside the fund on a deal-by-deal basis, according to the lender’s investment summary.
The Asia Energy Transition fund was launched in 2017 by SUSI Partners, a Swiss infrastructure fund manager specialising in sustainable investments supporting the energy transition.
The fund marks SUSI’s first investment vehicle for institutional investors, dedicated exclusively to the Southeast Asian energy transition market.
“The fund will respond to the region’s massive deployment of renewable energy infrastructure and the fast-growing demand for energy efficiency measures, bearing an investment potential comparable to the investment landscape in Europe a decade ago,” the private equity firm earlier said.
AIIB began operating as a regional multilateral development bank two years ago. It has channelled $8.5 billion in investment into as many as 45 projects in 18 countries.
In July, the Beijing-based multilateral development bank officially had 100 members with the addition of African countries Benin, Djibouti, and Rwanda. The bank says its members collectively account for 78 per cent of the world’s population and 63 per cent of global GDP.
The investment in SUSI’s fund comes as AIIB announced earlier that it aims to finance infrastructure projects worth $10-12 billion annually over the coming years.
This year, the lender aims to finance projects worth about $4 billion, about 20 per cent more than the $3.3 billion it financed in 2018.