March 25- March 29, 2024

Your Newsletter at a Glance

Commentary by C4C

Summary: $6.4 billion across 25 deals in climate ($4.8 billion), nature-based solutions ($1.1 billion), and hard to abate sectors ($473 Million).10 Essential Deals & Commitments

1. Germany plans a $24.8 billion green industrial push.
2. France and Brazil announced $1 billion investment in Amazon conservation and bio-economy.
3. NATO earmarks $1 billion for defense-focused climate tech investment.
4. Power 2X prepares to invest more than $1 billion in Estonian green methanol plant.
5. SLB buys an 80% stake in Aker for $380 million.
6. Royal London AM invests $328 million in regenerative agriculture and biodiversity restoration in the UK.
7. US Department of Energy enters negotiations with Technip and LanzaTech for a $200 million DAC project.
8. Vietnam receives $51.5 million in test of East Asian REDD+ programs.
9. The U.S Department of Interior prepares $11 million in landscape scale restoration projects.
10. Satgana closes an Africa focused climate fund at $8.6 million.

Policy & Regulatory Highlights:

• EU releases biodiversity risk assessment framework & updates rules for green bond validators.
• International maritime organization proposes carbon emission fee for shipping.

Climate & NbS Finance:

• Study highlights private capital’s greater exposure to the energy transition.
• Investors file record number of climate resolutions in first quarter of 2024.

Emerging Science:

• New study suggests 80% of Australian dry land carbon credit projects are not working as planned.
• Study finds Australian soil carbon set to become net carbon emitter under current warming scenarios.

C4C News and Events

Learn more about what we're doing

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Nature-based Solutions ≥ $1M

Commitments and deals

Commitments

UK pledges £ 6 million in climate-smart farming [pamedia]

• The UK will invest £ 6 million ($8 million) to help Zambian farmers train in climate-smart agriculture to curb agricultural deforestation in the country, protect nature and cut emission. The funding will train 100,000 smallholder farmers through 200 field schools, and is part of the Bio Carbon Fund Initiative for Sustainable Forest Landscapes.

Deals

UK government to invest £ 295 million in food waste reduction programs [businessgreen]

• The UK government has announced £ 295 million ($369.95 million) in funding to support weekly food waste collection by town councils through 2026. The project focuses on directing food waste to anaerobic digestion facilities to reduce greenhouse gas emissions and waste contamination.

Royal London AM invests £ 260 million in UK regenerative farming [environmentalfinance]

• Royal London Asset Management and South Yorkshire Pension Authority have acquired 21,000 acres of farmland through a £ GBP 260 million joint venture. The two firms aim to use the partnership as a testing ground for nature based solutions and regenerative agriculture systems.

EPA announces $206 million investment in Chesapeake Bay restoration, environmental justice and climate resilience [epa]

• The EPA has awarded $206 million in grants to projects focused on restoration and environmental justice throughout the Chesapeake Bay. The National Fish and Wildlife Foundation will use $193 million of the funding to improve climate resilient water and green infrastructure projects, while the Chesapeake Bay Community Trust will use the grants to enhance its community engagement and volunteer infrastructure.

Department of Commerce and NOAA to invest $60 million in tribal fishery restoration [noaa]

• The Department of Commerce and NOAA will allocate $60 million to support tribal land restoration of salmon habitat on the west coast. The projects will prioritize tribal initiatives, with a focus on improving salmon populations in the Columbia River basin.

Vietnam receives $51.5 million in carbon credit payments from REDD projects [vietnamplus]

• Vietnam has become the first country in the East Asia Pacific region to receive payments for a REDD+ project, receiving $51.5 million for reducing 10 million tons of carbon between 2018 and 2019. The payments will be distributed to 70,055 forest owners across 1,356 communities, according to a benefit sharing plan developed with the organization.

African Development Bank approves $50 million for climate change resilience and food security in Nigeria [afdb]

• The African Development bank will loan Nigeria's Yobe State $50 million to support enhanced climate resilience and food security. The project is estimated to cost $101.34 million overall, with additional financing from the Arab Bank for Economic Development in Africa and local partners. The funding will support projects combating drought and desertification, and provide improved cooking stoves to families and businesses, as well as implement a payment for ecosystem services scheme aimed at planting and maintaining 20 million trees.

$22 million announced for grazing land conservation initiatives [sustainable agriculture]

• The USDA Natural Resources Conservation Service has issued a call for applications for the  Grazing Lands Conservation initiative, which will provide $22 million in cooperative agreements to expande conservation practices on grazing lands. Applicants will be eligible for financial support and technical assistance to implement improved practices that conserve and restore grazing land.

Nespresso to invest $20 million in DRC coffee Agroforestry [gcrmag]

• Nespresso has announced plans to invest $20 million in sustainable specialty coffee production in the Democratic Republic of Congo by 2026. The investments will cover purchasing, technical assistance, and community development projects for communities in the Kivu region of the DRC.

American Forests to invest $12 million in climate resilient reforestation [streetinsider]

• American Forests and the U.S Forest Service have announced a 3 year, $12 million collaboration to help underserved landowners, particularly native groups, in implementing resilient reforestation solutions. The projects will provide technical assistance and support to more than 1000 landowners and 10 tribes.

Department of Interior invests $11 million in 29 landscape-scale restoration projects [einnews]

• The Department of Interior will provide $11 million for 29 landscape-scale restoration projects across 18 states using Bipartisan Infrastructure Law funding. The project will be focused on restoration of landscapes across the country in partnerships with local leadership, especially indigenous groups.

Calvert invests $10 million in sustainable sub-Saharan agriculture [environmentalfinance]

• Calvert Capital has invested $10 million in the eco.business fund, which supports sustainable agribusiness across sub-Saharan Africa. The fund, which is managed by Finance in Motion, focuses on integrating biodiversity protection and restoration into agricultural practices.

Clean Food Group raises €  2.9 million for food waste-derived sustainable oil and fat products [eu-startups]

• Clean Food Group has raised € 2.9 million from the UK-based Clean Growth Fund to accelerate the commercialization of its sustainable fats and oil technology. The company's process uses yeast to transform food waste into fats and oils for cooking.

Climate Finance ≥ $100M

Commitments and deals

Commitments

France and Brazil Agree on $1.1 billion investment plan for the Amazon [environmentalfinance]

• The French and Brazilian governments have announced a joint EUR 1 billion ($1.1 billion) public and private financing plan for protecting the Amazon over the next 4 years. The roadmap focuses on public bank cooperation, biodiversity credit development, developing the Brazilian carbon market, avoiding greenwashing and developing effective payment for environmental services systems.

NATO-backed venture fund aims to invest $1 billion in climate tech [bloomberg]

• NATO's "Defense Innovation Accelerator for the North Atlantic '' (DIANA) has earmarked EUR1 billion to invest in climate tech, related to preventing security complications from climate disasters and other shocks. The program has so far accepted 13 startups focused on projects ranging from grid resilience to microgrids .The accelerator has 23 regional startup hub sites and 182 test centers which will provide startups with resources to support innovation, and is providing grants  to purchase modernized equipment. The program is not taking equity in companies it invests in, but is providing introductions to companies seeking defense contracts.

ARA Partners targets $500 million for infrastructure decarbonization fund [altassets]

• ARA Partners has launched an infrastructure fund focused on investing in energy transition infrastructure.

EDC prepares $178 million green bond [environmental finance] [Think Geoenergy]

• The Philippine geothermal energy firm Energy Development Corporation aims to raise up to PHP 10 billion ($178 million) from its second green bond, 3 years after its first issuance. The bond is expected to be split into 2027, 2029 and 2031 tranches, and will be issued through the ASEAN Green Bond Mechanism.

Holmen plans $142 million Wind Farm Investment [lesprom]

• Holmen has announced a $142 million investment in a 14 turbine Swedish wind farm, among other wind and hydro projects, with the goal of boosting the company's hydro and wind power production by 20%. The company believes the investment will increase Holmen's annual production of renewable energy by 360 GWH, to just over 2 TWh.

New Summit begins raising for $100 million target climate tech fund [techcrunch]

• New Summit Investments has filed intentions to raise a $100 million impact fund, $60 million greater than its previous 2022 fund. The firm declined to comment on the fund's exact strategy.

Germany readies potential $24.9 billion green industrial push [bloomberg]

• The German government is preparing to implement a comprehensive "climate protection contract" plan aimed at helping high emitting sectors such as steel, cement and glass cover the expenses of clean technology adoption. The program is expected to cost as much as € 23 billion ($24.9 billion) depending on the cost of proposals issued by qualifying companies. The support systems is tied to the cost of carbon on the emission trading system, with companies paying based on the bid.

Deals
USDA invests $2.3 billion in rural clean electrification [Highlandcountypress]

• The USDA is investing $2.34 billion across 44 projects to support rural renewable energy access, with a focus on supporting rural electric cooperatives. The grants will be split between $129 million provided through the Powering Affordable Clean Energy program and $2.2 billion through the Electric Infrastructure Loan and Loan Guarantee program.

NBN Co raises EUR 1.3 billion green bonds [itwire]

• NBN Co, has raised EUR 1.3 billion ($1.4 billion) from a dual tranche EUR 700 million and EUR 600 million issuance for its second  Euro Green Bonds. The proceeds will be issued to eligble green projects such as energy efficiency and green power, according to the company's green bond framework.

CBRE issues EUR 750 million green bond [costar]

• CBRE Investment Management has raised EUR 750 million on a 10 year maturity, 4.75% coupon Green Bond. The proceeds will be issued towards eligble green products aligned with the euro green bonds framework, and the company's internal framework.

Biden Administration announces $173 million in low-income climate resilience funding [HUD]

• The U.S Department of Housing and Urban Development has announced $173.8 million in new grant and loan awards for retrofitting 25 properties participating in HUD’s Multifamily project-based rental assistance programs for low-income individuals. The funds will be used to make the properties more energy efficient and resilient to climate shocks.

Brookfield renewables announces $150 million green note issuance [morningstar]

• Brookfield Renewables has issued $150 million in fixed rate green sub notes, with an effective coupon of 7.25%.

Lightshift Energy Raises $100 million to scale battery storage [businesswire]

• Lightshift energy has announced $100 million in investments from Greenbacker Capital Management. The funding will be used to build out the company's utility scale grid storage portfolio.

New Mexico invests $50 million in DCVC climate tech fund [bizjournals] [state of new mexico]

• New Mexico's State Investment Council has approved a $50 million commitment to a climate-focused fund managed by DCVC. The fund is evaluating investments in New Mexico focused on water purification, geothermal energy production, and methane leak detection technology.

Cook Island receives first GCF single country project with $12.5 million investment [reliefweb]

• The Cook Islands has received the first single country project from the GCF, with a disbursement of $12.5 million for a $13.4 million project. The country will use the funding to help build a more climate resilient health system and avoid the spread of warm weather diseases.

Satgana closes Africa-focused climate tech fund with $8.6 million [techpoint africa]

• Satgana has closed a $8.6 million fund focused on backing 30 early-stage climate tech companies across Africa and Europe, well short of its $32.4 million target. The firm has still managed to close 13 investments so far, with 17 more needed to reach its initial targets. Investments are around $325,000, with a focus on mobility, food and agriculture, energy, industry and buildings, and the circular economy,

Hard to Abate Sectors ≥ $1M

Commitments and deals

Commitments

Power 2X plans $1.07 billion green methanol plant in Estonia [baltictimes]

• Power 2X, a Dutch large-scale decarbonization project developer, focused on clean hydrogen, ammonia, and methanol, has announced plans to invest around € 1 billion to build a green methanol production facility in Estonia, with an envisioned production capacity of 500,000 tons a year starting in 2028. The project is financially backed by CPP Investments, the global investment management organization that invests the Canada Pension Plan (CPP).

Technip and Lanzatech enter negotiations to receive $200 million for DAC from US DOE [carbonherald]

• Technip and Lanzatech have entered into negotiations with the US DOE regarding a $200 million investment to support their joint project SECURE – Sustainable Ethylene from CO2 Utilization with Renewable Energy. The project aims to produce sustainable ethylene from captured carbon dioxide, and would be supported by the DOE’s Industrial Demonstrations Program (IDP).

Deals

SLB invests $380 million in Aker Carbon Capture [cnbc]

• SLB will invest $380 million in an 80% stake of Aker Carbon Capture, with the goal of accelerating the deployment of the company's carbon capture technology.

Project Cypress Receives $50 Million in first tranche of DAC hub development [carbonherald]

• Project Cypresss has been awarded $50 million from the Office of Clean Energy Demonstrations as part of the regional Ddirect Air Capture Hubs program. The award is expected to mobilize an additional $51 million. The Project is finalizing its siting and storage options in Louisiana, and will utilize a solid sorbent capture system with geologic storage to remove 1 million tons of CO2 annually by 2030.

Unilever awards $20.9 million to decarbonize ice cream plant [roi-nj]

• Unilever has announced $20.9 million to cut 14,000 metric tons of carbon emissions per year from its ice cream operations by replacing gas boilers with electric boilers and heat pumps, building on its achievement of 100% renewable grid energy in 2020. The project is eligible for rewards from the Industrial demonstrations program.

Lego purchases $2.8 million in DAC carbon removal [esgtoday]

• Lego has signed a 9-year direct air capture carbon removal agreement for $2.8 million with Climeworks, as part of the company's climate targets.

Research and Knowledge Sharing

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Policy and Regulations

EU proposes new rules for green bonds [reuters]

• The European Commission has published a new framework for ensuring competition among green bond reviewers and lowering issuer costs. The EU approved voluntary issuance rules last October, and the new rules will provide corresponding guidance for external reviewers.

EU releases biodiversity risk assessment framework [environmentalfinance]

• The European Commission has published its biodiversity risk management framework, which lays out guidelines for financial institutions on how to identify potential biodiversity risks from investments. The framework is aligned with the TNFD and Network for Greening the Financial System methodologies, and will be continually updated.

International Maritime Organization releases plan for shipping industry carbon fee [nytimes]

• The International Maritime Organization has released a proposal for a fee per ton of carbon emitted by shipping, which could potentially impose a carbon tax on the more than 50,000 large cargo ships that form the backbone of international trade, and account for around 3 percent of greenhouse gasses.

Rollout of Bipartisan Infrastructure Law EV charging network severely delayed [washingtonpost]

• Administrative delays, contracting issues, and state and federal conflict have meant that only 7 charging stations out of a goal of 5000 have been built by the Biden administration from the $7.5 billion earmarked in the Bipartisan Infrastructure Law. While some delays were expected due to lack of experience building charging infrastructure, the scale of the slow implementation has worried electric vehicle advocates.

Finance Research and Updates

UN PRI releases introductory guide to biodiversity for asset owners [UNPRI]

• UNPRI has released a guide to the basics of biodiversity-conscious investment for asset owners. The guidance provides a thorough overview of the organization's standards for how to build biodiversity management into financial decision making, and builds off earlier research by organizations such as the Grantham Institute.

Study finds no top oil companies actions are aligned with climate goals [thehill]

• Climate Tracker has found that none of 25 tracked oil and gas companies is on track to meet the Paris Climate Agreement goals. Only one company, Eni, came close to being aligned, with a 3 out of 4 on alignment, while 16 scored a zero on emissions reduction.

Average 60% of green sovereign bond allocation is for transportation [financialtimes]

• An investigation by the Financial Times finds that, of the more than $500 billion raised through sovereign green bonds, 60% has been spent on transportation, with water coming in a distant second. The study found that even funds earmarked for other causes were utilized for transportation, with many projects having an unclear environmental benefit.

OECD publishes global debt report with focus on sustainable bond [harvard]

• The OECD has published its first Global Debt Report, with findings on the growing sustainable debt market. One major take-away is that green and sustainable bonds now make up 2% of corporate and govt debt outstanding, but there has not been a premium (discount) available to issuers.

MSCI finds heavier exposure for private vs public climate funds [esgtoday]

• A new report from MSCI has found that Net-Zero Transition Opportunities exposure is higher for private climate-focused funds than public climate funds, with private funds having a 45% utilities exposure, as opposed to public funds’ 6%. They also found that 50% of cumulative capitalization of private market climate funds was in infrastructure, further highlighting their exposure to the transition.

Investors file record # of climate resolutions for North American companies [reuters]

• Shareholders have filed a record 263 climate related resolutions so far in 2024, according to Ceres, representing the most in the first quarter of the year since security regulators made ESG resolutions easier to file in 2021.

Emerging Science

Study finds Australian carbon credit system not working [theguardian]

• A study in Communications Earth and Environment that analyzed 182 Australian NbS carbon removal projects in arid areas finds that forest cover had either barely grown or gone backwards in nearly 80% of projects. The Australian government pushed back on the findings, saying that it had confidence in the system, and that Ian Chubb, a former Australian scientist, had found the system "basically sound" - though his review had been systemic, not focused on individual projects.

Australian soil will become a net emitter of CO2 under current warming pathways, study finds [nature]

• If current warming patterns continue, Australian Soil Carbon stock is likely to become a net emitter instead of net absorber for CO2 over the next century. The accrual of carbon in croplands is also expected to decrease due to warming, limiting their ability to counteract soil carbon loss.

Nature Communications study examines areas to reforest and avoid negative albedo effects [nature]

• Nature Communications has published a study of how tree planting projects can counteract the effects of changes in albedo, which the authors say could skew carbon-only estimates by as much as 81%. The study found that current on the ground reforestation projects are generally clustered in climate positive areas, but the majority face a 20% albedo offset. The study provides methods for siting reforestation projects to minimize albedo offsetting.

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