REPORTING FROM 5 NOVEMBER - Climate Investment Funds · 2019. 8. 21. · Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1...

REPORTING FROM 5 NOVEMBER

İSTANBUL, 5 NOVEMBER 2012 2 / / / /

Context

Case Studies

Matching expectations,

Looking ahead

INTERACTIVE: Where do you live? 1. Asia

2. Middle East and North Africa

3. Europe

4. North America

5. Latin America and the Caribbean

6. Sub-Saharan Africa

7. Australia and Oceania Asia19%

MENA2%

Europe31%

North America

22%

Sub-Saharan

Africa14%

Latin America

10%

Oceania2%

Total

INTERACTIVE: What perspective do you bring? 1. Policymaker

2. Regulator

3. Civil Society / NGO

4. International Organization

5. Investor

6. Project developer Policymaker

14%

Civil Society /

NGO 26%

International Org

26%

Investor 17%

Project develope

r 17%

MICHAEL LIEBREICH, ISTANBUL, 5TH NOVEMBER 2012 TWITTER: @MLiebreich 5 / / / /

GLOBAL NEW INVESTMENT IN CLEAN ENERGY 2004–11 ($BN)

Source: Bloomberg New Energy Finance

Note: Includes corporate and government R&D, and small distributed capacity. Adjusted

for re-invested equity. Does not include proceeds from acquisition transactions.

$54bn

$75bn

$113bn

$153bn

$187bn$189bn

$247bn

$280bn

39%

51%

35%

22%

1%

31%

13%

2004 2005 2006 2007 2008 2009 2010 2011


TOTAL INVESTMENT IN CLEAN ENERGY

Source: Bloomberg New Energy Finance, Columbia Pictures

In energy, a billion dollars

isn’t cool. You know what’s

cool?

A trillion dollars.

That’s cool


8.6 8.4 7.89.5

11.5

16.5

12.9

18.419.7

21.721.6

34.0

24.9

28.4

33.7

46.2

34.0

45.9

41.043.1

26.2

45.745.542.7

46.5

52.255.5

63.3

53.9

71.870.7

58.0

48.0

59.6

56.6

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

2004 2005 2006 2007 2008 2009 2010 2011 2012

Four quarter running average

NEW INVESTMENT IN CLEAN ENERGY Q1 2004–Q3 2012 ($BN)


Note: Total values include estimates for undisclosed deals. Excludes corporate and government R&D.

Includes small distributed capacity & adjustment for re-invested equity.


CROSS-BORDER INVESTMENT SHARES BY REGIONAL

FLOW, 2004 – H1 2012 (%)


Note: new build asset finance for renewable energy projects only. Investment volumes show cross-border

(or foreign) investments only. Domestic investments are excluded here.

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2004 2005 2006 2007 2008 2009 2010 2011 H12012

North/South

South/South

South/North

North/North

Shows that investment in the South in 2011 surpassed the 25% mark


It is impossible –

and also very

difficult

EL GALLO, BULLFIGHTER

PRIVATE SECTOR ADAPTATION:

EMERGING EXPERIENCE FROM

GLOBAL BUSINESS

CARBON DISCLOSURE PROJECT

FRANCES WAY

Adaptation is a Business Issue

“Changing temperatures and precipitations patterns may lead to decreased availability of

critical raw materials in the supply chain, especially agricultural commodities. These will

lead to the increased operational cost or even disrupt the business operations along the

entire value chain of Nestlé.”

Nestlé 2012 CDP Response

Global 500 2012 Climate Change Responses

Allianz reported that in 2011

it processed $2.2 billion in

natural catastrophe claims

(including non-weather

related claims). This is the

largest sum for natural

catastrophes in its history.

Timeframe for expected physical risk impact (number of companies)

81% of G500 respondents

report physical risks

(+10% from 2011)

96% have board or senior level

oversight of climate change

(+3% from 2011)

78% integrated climate change

into wider business strategy

(+10% from 2011)


Context

Successes


Looking ahead

The Developer’s Perspective Ouarzazate 1 CSP Project in Morocco

Climate Investment Funds'

Private Sector Forum Istanbul, November 5, 2012

What was the innovative factor in the investment?

Sunday, 04 November 2012 Ouarzazate 1 CSP Project in Morocco 17

Ouarzazate 1 CSP (160MW with three hours

of storage) is one of the three largest CSP

projects under development in the world

With only 1.6 GW of installed CSP capacity

in the world, this plant alone at 160MW will

add 10% to the total installed global capacity

This project has delivered a framework that

has enabled International Financial

Institutions (IFIs) who by charter can only

lend to Governments, lend to a project

structured within the framework of Limited

recourse Project finance which underpins the

PPP model of service delivery contracts.

This has been achieved by the IFIs lending

through a government vehicle; in this case

MASEN (the Moroccan Renewable Energy

procurement Agency) but with “look through”

and “back to back” terms

1

Sunday, 04 November 2012 Ouarzazate 1 CSP Project in Morocco 18

How did the CIF funds add value to the tariff? 4

Debt Funding Leverage

Tenor/

years

Debt

interest

rate

Resulting

tariff US

cents/kWh

Likely funding from commercial sources for this

very large CSP project in Morocco

75/25 20 7.5% 24.5

The optimistic commercial debt funding case 75/25 20 5.5% 21.5

IFI funding (including CIF Funds) 80/20 25 3.5% 18.9

The issues on

Debt funding is

• Liquidity/Availability of the required amount

• Leverage (equity / debit ratio)

• Tenor of debit

• Price of debit (interest rate)

?

What has CIF Funds and World Bank leadership brought to this project?

• Discounted pricing terms, (buying down the risk premium of the project)

• Mobilizing larger amount of funds (bringing other public sources of funding

from MDBs, bilateral agencies, and government)

DenizBank Project Finance

CIF 2012

Partnerships with IFI’s and Development Banks

Cofinancing partnerships with development banks

Funding partnerships

• EUR 150 million MidSEFF (EBRD & EIB)

• USD 40 million TURSEFF (EBRD & JBIC& CTF)

•The objective of MidSEFF & TURSEFF is to reduce Turkey’s dependence on fossil

fuels by financing private sector investments in mid-size renewable energy projects.

• 2009 : DenizBank financed the Rotor Wind Power Plant of Zorlu Group (135

MW) in partnership with EBRD, IFC, EIB

• 2009 : DenizBank participated in the financing of the Akfen HEPP portfolio (20

HEPP’s with total IC 270 MW) in partnership with TSKB

• 2009-2010 : DenizBank provided letters of guarantee lines for TKB for Muratlı

HEPP and Kapıdağ WPP

Sustainable Energy Financing: TURSEFF&MidSEFF

DenizBank Experience

~ 90 diversified renewable energy & energy efficiency transactions realized

through TURSEFF & MidSEFF lines with over USD 100 mio loan exposure

Mainly SME & commercial banking segment clients benefiting from a

systematic approach:

• Due diligence & double checking of the technical assumptions

• ESAP (Environmental&Social Action Plan): Road map with concrete

actions & supervision of environmental and social issues

Enhanced awareness of environmental standards

More Clean, Conscious and Sustainable…


Context

Successes


Looking ahead


CLEAN ENERGY FINANCE AND CLIMATE FINANCE

STAKEHOLDERS

Sources

of

finance

Investment

managers

(private)

Enablers

and service

providers

Corporations (eg, start-ups, oil and gas, utilities, technology providers)

Policy Heads of state / Legislators / Ministries (eg, energy, environment, finance)

Heads of regions / Electricity regulators

Endowments / Pension funds / Life insurance companies / High net worth individuals and family offices

Venture capital / Incubators / Private equity (companies)

Private equity (projects) / Infrastructure funds

Debt funds / Carbon funds

Microfinance providers

Hedge funds / Mutual funds

Investment banks / Consultants / Law firms

Rating agencies

Insurance providers / Letter of credit providers

Hedging providers

Early R&D, Proof

of Concept

Demonstration and

Scale-up

Commercial Roll-

out

Diffusion &

Maturity

Investment

managers

(public)

Development banks / Grant-giving bodies / National treasuries

/ Sovereign wealth funds / Export credit agencies

Industry


PUBLIC-PRIVATE PARTNERSHIPS: DIFFERENT

STAKEHOLDERS, DIFFERENT VIEWS

PUBLIC SECTOR PRIVATE SECTOR

SUCCESS

IS….

Progress

Happy constituencies

Flow of funds to the developing world

Profits

Returns

Repatriation of profits

CONCERNS

ARE…

Fairness

Political realities

Measure / Report / Verify of donors

Risk, risk, risk

Liquidity

MRV of recipients

FOCUS

IS…

$ billion scale

Need to be comprehensive

Restricted to imperatives

$ trillion scale

Need to find opportunities

Can choose among alternatives

STYLE

IS…

Patient – decade goals

Sharing

Qualitative

Short term – annual goals

Competitive

Quantitative

Reporting from the Private Sector Forum

Regulators/Policy Makers

Investors/Lenders

Project Developers

• Climate investing value chain • Market Transformation: Large

number of small innovations or small number of large innovations • Standardisation (terms & condition,

PPAs, etc.)

Landscape of financing Activities

• Market solutions – Innovative Products, innovative business models

• Policy solutions – fit regulations, long term support, consistency, entrepreneurship

• Financial solution – Liquidity, access to capital, risk sharing, scale

Matching Expectations

REPORTING FROM 5 NOVEMBER - Climate Investment Funds · 2019. 8. 21. · Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1...

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