Attracting private investment

Attracting
private investment

Melinda L. Kimble

The board of the United Nations Foundation (UNF) has recently approved two grants, totalling $1,250,000, to attract private-sector investment to projects that promote sustainable development through alternative energy resources and other approaches.

Footprint Neutral
Footprint Neutral will receive $750,000 in UNF funds to create an innovative public-private partnership to attract investment in projects that mitigate climate change while providing conservation and development benefits. It is modelled on a successful pilot project by BP, the leading global energy business, and the Commonwealth Bank in Australia. In this, the extra money paid by consumers for ‘BP Ultimate gasoline’ was invested in projects to offset the effects of its use.

The partnership aims to attract corporations, municipalities and other partners to invest in projects that offset their impact on the global climate by developing and marketing portfolios of alternative energy and carbon sequestration initiatives.

Addressing global environmental problems and alleviating poverty requires the engagement not only of the government, but also of businesses and consumers, and the ingenuity and resources that they provide. Footprint Neutral is an innovative new mechanism that provides opportunities to achieve this.

Sustainable Energy Finance Initiative
The Sustainable Energy Finance Initiative (SEFI) will receive $500,000 from the UNF and an additional $250,000 from the Italian Ministry for the Environment and Territory (IMET). Designed and implemented by UNEP and the Basel Agency for Sustainable Energy, it will attract financing to sustainable energy development. Inadequate information and insufficient experience – coupled with the lack of tools needed to quantify, mitigate and hedge project and financial risks – have in the past constrained capital investment in renewable energy and energy efficiency.

The UNF and IMET grants will be used to establish SEFI’s operational and governance structure; to create a communications and outreach strategy; to develop information resources for financiers; and to build partnerships through a Global Sustainable Energy Finance Conference, a UNEP Finance Initiative Renewable Energy Working Group and an Export Credit Agency Renewable Energy Initiative.

Through these diverse activities SEFI will both enhance understanding about emerging renewable energy and energy efficiency financing opportunities, and develop the tools and partnerships needed to minimize investment risk and build investor confidence

Melinda L. Kimble is Senior Vice President for Programs, United Nations Foundation.

PHOTOGRAPH: T. Kitahata/UNEP/Topham