Zurich-based impact investor responsAbility Investments AG, which is an active investor in India, Tuesday announced the first close of its climate debt fund at $151 million.
The fund, which is focused on Sub-Saharan Africa and South and Southeast Asia, could grow to $200 million. It aims to mark the second close later this year, the impact investor said in a statement.
The fund has received commitments from a number of prominent public and private investors, including AHL Venture Partners, Ashden Trust, Bank of America, Bohemian Impact Investments, Calvert Impact Capital, European Investment Bank, Dutch development financier FMO, International Finance Corporation and the government of Luxembourg.
The private debt fund will address the lack of access to clean power globally with a strong focus on the aforesaid regions. It is set up as a blended finance structure offering different risk tranches, the statement added.
“By partnering with entrepreneurs as a first commercial lender, we want to enable clean energy businesses to scale up their activities and attract more funding in the long run,” said Antoine Prédour, who oversees responsAbility’s energy debt financing activities.
The fund targets companies that provide solutions to households without access to electricity and to businesses looking for cleaner, cheaper and more reliable energy. responsAbility said that the fund is also the first of its kind to actively address the solar energy potential for the commercial and industrial sector.
Over the lifetime of the fund, portfolio companies are expected to provide clean power to more than 150 million people, add 2,000 MW of clean energy generation capacity, and reduce CO2 emissions by 6 million tonnes.
“By providing debt to companies supplying off-grid and distributed energy generation solutions to households and SMEs, the Fund will fill an important financing gap in a sector that is essential to achieving both economic and social development,” said Emma Navarro, Vice President, European Investment Bank (EIB).
Founded in 2003, responsAbility currently has over $3 billion of assets under management. It has invested in about 450 companies in 90 countries. Its portfolio companies in India include Satin Creditcare Network Ltd, a micro-finance institution, and commodities and rural finance company Origo, among others.