Dubai, UAE, December 3, 2023 – At the Singapore Pavilion during the 2023 United Nations Climate Change Conference 28th Conference of the Parties (COP28), Convergence announced the inaugural cohort of the Asia Climate Solutions (ACS) Design Grant.
The three grantees will receive proof of concept and feasibility study grants to address climate action across South and Southeast Asia with a focus on nature-based solutions (NbS) and clean energy transition.
"These are 3 very remarkable organizations," said Leah Pedersen, Convergence Senior Director, Market Acceleration and Design Innovation. "They are on the cutting edge, working with complex ideas, complex challenges and really trying to boil those down so that they’re bankable and understandable by investors," Ms. Pedersen continued.
The ACS Design Grant targets critical climate mitigation and adaptation sectors in Asia including NbS, clean energy transition, and sustainable cities and infrastructure. It provides feasibility study and proof of concept grants for innovative, high-impact and investible solutions using blended capital structures.
The ACS Design Grant is funded by four anchor donors: the Department of Foreign Affairs and Trade Australia, the Monetary Authority of Singapore, The Olayan Group, and UBS Optimus Foundation.
Following the success of Cycle 1, the ACS Design Grant is now accepting concept notes for the window’s second cycle. The submission deadline is February 12, 2024.
Introducing the Grantees
NBSV Worldwide (sister entity of Fairventures Social Forestry) was awarded a proof of concept grant to design a dual blended finance structure to support 100,000 hectares of regenerative agroforestry projects in Indonesia. The projects will operate in close collaboration with local communities who will in turn benefit from the increase in employment and a stable income.
Convergence previously supported Fairventures Social Forestry with a feasibility study grant under the Asia Natural Capital Window and is now providing a proof of concept grant to further support the design and launch of this vehicle.
“The grant is important for us to prepare for the next funding round of the blended finance vehicle we recently launched. We designed the vehicle and completed the seed funding round as a grantee under the Asia Natural Capital Window. The grant will also support us to finalize the design activities of the vehicle. The vehicle will bring to market investment opportunities in regenerative agroforestry projects in Indonesia totaling at least USD 100m in the coming years. We are very grateful for the continued support of Convergence and its partners.”
— Paul Schüller, CEO of Fairventures Social Forestry & NBSV Worldwide
Lestari Capital was awarded a feasibility study grant for a blended vehicle to invest in conservation and restoration projects in South-east Asia that target ecosystem-level outcomes including carbon emission reduction, preservation of biodiversity and community benefits that can be monetized as Nature Credits. The vehicle will also facilitate corporations to take nature-positive action in their agricultural sourcing areas through the purchase of Nature Credits generated by these projects.
"Lestari Capital is excited to start designing this fund vehicle which will help corporates address their climate and biodiversity land footprints through collective action with their supply-chain partners. Building off the design of our existing Rimba Collective finance mechanism, this fund vehicle will use emerging standards and regulations to scale and broaden its applicability to a wider set of commodity buyers. This will unlock corporate funding to protect valuable forest and mangrove ecosystems that currently lack access to long-term funding from the carbon markets. This is another important step in our mission to build a corporate market for climate and nature outcomes.”
— Alexander Hanrath, Chief Investment Officer, Lestari Capital
Powertrust was awarded a feasibility study grant for designing a blended finance facility, which aims to provide upfront capital to support the development of distributed renewable energy (DRE) projects across South & South-east Asia. The vehicle will help create an additional revenue stream for these projects in the form of distributed renewable energy certificates (D-RECs) and also help secure commitments from corporations for these D-RECs enabling them to meet their sustainability targets.
"This Convergence grant is instrumental in catalyzing new distributed renewable energy in South East Asia. It will facilitate upfront investment, leveraging the Powertrust model of connecting corporate climate leaders with high-impact distributed renewables. Distributed renewables may be small, but aggregated at scale they make a powerful contribution to addressing both our climate targets and universal Sustainable Development Goals. Powertrust is looking forward to working with the climate finance community to participate in this innovative new blended facility."
— Nick Fedorkiw, Co-founder and CEO, Powertrust
Quotes from ACS Anchor Donors
“The Monetary Authority of Singapore is proud to host an innovation showcase of the inaugural recipients of the ACS Design Grant at the Singapore Pavilion at COP28. The grantees are harnessing blended finance for maximum impact and innovating new ways in which public, private and philanthropic actors can collaborate to jumpstart and scale effective climate solutions across Asia.”
— Gillian Tan, Chief Sustainability Officer and Assistant Managing Director (Development and International) of the Monetary Authority of Singapore
“The Olayan Group is proud to support the ACS Design Grant and applauds the grantees who were selected through Convergence’s rigorous application and review process; we look forward to witnessing the fruits of the grantees’ labor as they work to advance climate resiliency in Asia-Pacific region and beyond”.
— Sung Chul Whang, General Counsel, Asia-Pacific The Olayan Group
“UBS Optimus Foundation is delighted to see the first grants being awarded to three very deserving concepts which take an innovative blended finance approach to solve some of Asia’s most pressing social and environmental issues. They’re combining blended finance models, and piloting nature credits and pre-purchase agreements for renewable energy. What really impressed us is that nature takes center stage. As nature continues to be an important strategic focus for us too, we will closely track their evolution and wish them the very best.”
— Maya Ziswiler, CEO, UBS Foundation
About Convergence
Convergence is the global network for blended finance. On top of market acceleration through its Design Funding program, Convergence generates blended finance data, intelligence, and deal flow to increase private sector investment in developing countries. Convergence’s global membership includes over 160 public, private, and philanthropic investors as well as sponsors of transactions and funds.
Convergence’s Design Funding Program operates as a market acceleration tool providing early-stage capital to support blended finance solutions in frontier markets and nascent sectors to accelerate the number of investible transactions in market targeting SDGs.
About the Monetary Authority of Singapore
The Monetary Authority of Singapore (MAS) is Singapore’s central bank and integrated financial regulator. As a central bank, MAS promotes sustained, non-inflationary economic growth through the conduct of monetary policy and close macroeconomic surveillance and analysis. As an integrated financial supervisor, MAS fosters a sound financial services sector through its prudential oversight of all financial institutions in Singapore and financial market infrastructures. It is responsible for well-functioning financial markets, sound conduct, and investor education. MAS also works with the financial industry to promote Singapore as a dynamic international financial centre.
MAS launched its Finance for Net Zero Action Plan in April to catalyse Asia’s net zero transition, expanding its focus from pure green finance to include transition finance. It covers outcomes in data, definitions & disclosures, a climate resilient financial sector and credible transition plans for FIs. MAS will continue to grow and scale Green FinTech solutions and develop the skills and capabilities for Singaporeans and our financial sector.
About the Australian Department of Foreign Affairs and Trade
The Australian Department of Foreign Affairs and Trade promotes and protects Australia’s international interests to support our security and prosperity. We work with international partners and other countries to tackle global challenges, increase trade and investment opportunities, protect international rules, keep our region stable and help Australians overseas.
About The Olayan Group
The Olayan Group is a multinational enterprise with an actively managed portfolio of global investments. The Group has international offices in Vaduz, New York, London, Luxembourg, Athens, Riyadh and Singapore. The Group’s in-house professionals manage a multi-billion-dollar investment portfolio.
About UBS Optimus Foundation
UBS Optimus Foundation is an independent grant-making foundation that offers UBS clients a platform to use their wealth to drive positive social and environmental change. The Foundation selects programs that improve children’s health, education and protection, ones that have the potential to be transformative, scalable and sustainable as well as programs tackling environmental and climate issues.
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