Mirova, the affiliate of Natixis Investment Managers dedicated to sustainable investment, supported by Mirova SunFunder East Africa Ltd as Investment Advisor, a wholly-owned subsidiary based in Nairobi, announced today that the Mirova Gigaton Fund has raised USD 171 million for its first closing.
This blended finance debt fund aims to accelerate the clean energy transition in emerging countries in Africa and Asia Pacific predominantly, as well as Latin America and the Middle East. Mirova SunFunder is a leading impact investor, solving energy access and climate change challenges in frontier markets, primarily Africa, by providing clean energy financing.
“Today, more than 770 million people lack energy access in the world – mostly in Africa and developing Asia – regions with populations that are also the most vulnerable to the global climate crisis. Addressing climate change requires a reallocation of capital to decarbonizing global economies, particularly a clean energy transition in emerging markets. The Mirova Gigaton Fund will provide medium-long debt financing for clean energy projects and companies, accelerating the transition to a low-carbon economy and improving energy access in Africa, Asia Pacific & Latin America. We are grateful for all of the Mirova Gigaton Fund investors for their support and partnership.”Ryan Levinson, Director of the Mirova Gigaton Fund, Head of Emerging Market Energy Transition.
The fund’s target size is USD 500 million and expects to deploy USD 1.2 billion of private debt throughout its life primarily to small and medium-sized enterprises (SMEs) in solar home systems, agri-solar, commercial & industrial solar, telecom tower solarization, mini-grids and other promising sectors such as e-mobility, battery storage, climate-smart food systems, energy efficiency and carbon credit pre-financing. Classified “Article 9” under the framework of the new European SFDR, the fund aims to impact peoples’ lives by offsetting CO2 emissions (SDG 7, SDG 13), creating jobs (SDG 8), advancing gender equality (SDG 5) and improving energy access (SDG 7, SDG 8, SDG 5).
Long-standing partners such as U.S. International Development Finance Corporation (DFC), Swedfund, and Sida as well as new investors will provide the catalytic capital and guarantee that help decrease risks and consequently unlock private capital. Natixis Private Equity also invested in the fund to further mobilize private investors, combining investors’ resources to truly scale clean-energy investments, with robust social, gender and economic impacts. The fund already constituted a pipeline of investments in over 30 countries and continues to actively seek new investable opportunities that further the efforts to build a sustainable and low carbon future.
“As a mission-driven, global responsible investor, we are aware that a large portion of the rise in global power demand will be driven by expanding non-OECD economies. As we have seen growing interest from investors for long-term investments in tangible assets and attractive yield potential, we are confident that the Mirova Gigaton Fund constitutes an interesting opportunity to finance the energy transition around the globe, relying notably on Mirova SunFunder’s expertise and know-how in emerging markets.”Raphaël Lance, Head of Energy Transition Funds at Mirova.