Greetings, Agents of Impact!
👋 Hop on today’s Call. Join Marjorie Henning, NYC’s deputy comptroller for public finance, Kimberlee Cornett of the Robert Wood Johnson Foundation, Public Finance Initiative’s Lourdes Germán, and Rob Fernandez of Breckinridge Capital Advisors, in conversation with ImpactAlpha’s David Bank and Dennis Price for “Optimizing muni bonds for racial equity,” today at 10am PT / 1pm ET / 6pm London (no RSVP necessary). Zoom right in.
- Background reading. Catch up quickly with these Muni Impact posts, made possible with support from the Robert Wood Johnson Foundation: “Optimizing the municipal bond market for health equity and racial justice (podcast),” “The ‘Black Tax’ plagues small municipalities. Can bond banks help?,” and “Managing social risks and addressing racial inequities in the muni bond market.”
Featured: Climate Finance
Turning gaps into opportunities with the Climate Finance Tracker. Billions of dollars in venture capital are pouring into climate tech. And hundreds of organizations, initiatives, coalitions and conferences are calling for climate justice and equity. There’s virtually no overlap. How do we know? The Climate Finance Tracker, developed by Vibrant Data Labs’ Eric Berlow and featured on ImpactAlpha, illuminates more than 6,000 U.S.-based climate-relevant companies and nonprofits that have received over $230 billion in private investments and grants in the past five years. The Tracker makes visible patterns that are impossible to see simply by visually scanning thousands of companies.
The Climate Finance Tracker suggests at least three opportunities to bridge the climate-financing gap and accelerate climate action to limit global warming to 1.5 degrees Celsius above historical levels.
- Energy transition. Achieving 100% renewable energy and mobility by 2050 requires a vast acceleration of access by lower- and middle-income populations in the U.S. and around the world. “We will never get there if only 1% of the people can afford it,” Berlow says. “Here, climate equity is not just the right thing to do, it’s the only way to achieve a 100% energy transition.”
- Nature conservation. The gap in efforts to protect and restore 50% of Earth’s lands and oceans consists mostly of grant-funded organizations that cluster around nature-based themes infrequently prioritize local livelihoods or social and economic equity. “This is one of the main reasons why conservation efforts fail – they protect the land but screw the people,” says Berlow, an ecologist by training.
- Regenerative agriculture. Shifting agriculture to net-zero requires that advanced agtech solutions be made accessible to small-scale producers and that plant-based diets become available to all. Small-scale and community-based regenerative food solutions – still mostly grant-funded – need help attracting commercial capital. Says Berlow, “The opportunity here is to nudge this bubble to the right by supporting more investable business models.”
- Keep reading, “Turning gaps into opportunities with the Climate Finance Tracker,” by David Bank on ImpactAlpha. Identify additional gaps and opportunities with the Climate Finance Tracker and share your feedback here.
Dealflow: Energy Transition
Indonesia aims to cut emissions – slowly – with $300 million coal-plant deal. As Indonesia hosts G20 leaders this week in Bali, the Asian Development Bank teamed up with an Indonesian power producer to accelerate the country’s transition to renewable energy, albeit slowly. The bank will provide up to $300 million in debt financing to enable Cirebon Electric Power to decommission a 660-megawatt coal-fired power station by 2037, or up to 15 years ahead of its expected shutdown. As late as that seems, the accelerated shuttering would avoid as much as 33 million tons of greenhouse gas emissions. With 60% of its electricity coming from coal, Indonesia is one of the world’s most prolific producers of greenhouse gases.
- The power of blending. The agreement is the first of its kind under ADB’s Energy Transition Mechanism, a blended-finance program to help Asian nations wean themselves off of fossil fuels by retiring coal-fired power plants and replacing them with clean energy. The mix of capital includes donor-supported funds and a portion of Indonesia’s $500 million allocation from the multilateral Climate Investment Funds.
- Just transition. Indonesia also this week launched a $20 billion Just Energy Transition Partnership with Japan, the U.S., U.K., Denmark and Italy, and financial institutions including Deutsche Bank, HSBC, Macquarie and Citi. The JETP will provide at least $10 billion from the public sector and $10 billion from the private sector to accelerate Indonesia’s net-zero transition by 10 years to 2050, reduce 2030 power-sector emissions, and accelerate renewable energy supplies.
- Dig in
Katapult’s Africa accelerator zeros in on food security. Insect farming in Ghana. Aquaculture in Kenya. Land restoration in Morocco. Seven of the nine startups in the Norway-based impact tech accelerator’s new Africa cohort address the continent’s food security and agriculture value chain. Africa’s food supply hinges on small-scale farmers, whose efficiency, yields and incomes are threatened by climate change and lack of access to new technologies and finance. In the cohort: Kenya’s GrowAgric provides farmers with digital working capital loans, while Aquarech is connecting fish farmers to buyers and feed suppliers. Nigeria’s Vetsark Cleva provides digital bookkeeping and business services to farmers and agribusinesses. Senegal’s Afrikamart is connecting farmers to buyers online. Morocco’s Sand to Green is restoring soils and converting desert into arable land through agroforestry.
- Pay for success. Separately, Germany committed $15 million to the U.N.’s International Fund for Agricultural Development to pay rural communities and smallholder farmers to preserve natural resources. The funding will support three projects, including forest preservation in Brazil and water resource management and soil restoration in Lesotho. The Lesotho project, as well as a planned project in Ethiopia, will connect farmers to voluntary carbon credit markets as new income streams. The European Investment Bank is investing $500 million with IFAD for a separate rural lending program.
- Check it out.
Energy Impact Partners seals $485 million early-stage climate fund. EIP’s Frontier Fund invests in big-bet climate startups with proven decarbonization technology that is poised to scale. Early investments include long-term storage darling Form Energy, zero-carbon fertilizer maker Nitricity, and electrified zero-carbon cement company Sublime Systems. “Our job is to find and support entrepreneurs creating the fundamental building blocks of a net-zero future,” tweeted EIP partner Shayle Kann.
- Climate clamor. The fund targeting early-stage investments is a first for New York-based EIP, which made its name investing in solutions ready to be deployed by its network of corporate partners. It was oversubscribed, the firm says, drawing commitments from EIP’s existing corporate, sovereign wealth, family office and other investors. The closing brings EIP’s total capital raised to more than $3 billion, including a €390 million European fund it raised in September.
Dealflow overflow. Other investment news crossing our desks:
- Closed Loop Partners and Brookfield launched Circular Services to curb landfill waste for municipalities and businesses. The new private recycling company is backed by $700 million from Brookfield’s net-zero economy-focused Global Transition Fund.
- Sistema.bio clinched $10 million from impact investor Native to supply farmers in East Africa with biodigesters that recycle farm waste into fertilizer and biogas.
- Rwanda’s Eden Care raised pre-seed funding to help African employers enroll their employees in health insurance and wellness programs.
- EnCap Investments sold its stake in Jupiter, a utility-scale battery storage operator, to BlackRock.
- South Africa’s Contro secured close to $600,000 in pre-seed funding to provide telehealth services, primarily for reproductive and sexual health issues.
Impact Voices: Impact Alpha
A moonshot mindset for social impact advantage. Throughout her career, which spans stints at NASA and GE and running nonprofit City Year, CapEQ’s Tynesia Boyea-Robinson has witnessed businesses treat social impact as a “side dish” rather than the main course. “Few saw it for what it really is, or could be – a talent recruitment tool to gain highly qualified staff with a high probability for long-term retention,” Boyea-Robinson writes in her new book, The Social Impact Advantage, excerpted for ImpactAlpha.
- Win-win. Year Up, which trains and places high school graduates for apprenticeships in tech companies, “gave companies a chance to improve their bottom line while also improving society,” she says, something companies rarely acknowledged. Boyea-Robinson knew that until the business community recognized the win-win, “we would not only fail to solve society’s biggest challenges, but also fail to unleash the true power of business and the capitalist engine that drives it.”
- In practice. Boyea-Robinson’s book walks readers through a step-by-step process to leverage the power of social impact in their businesses. At CapEQ, she has helped companies like Walmart, Carlyle Group and Athleta leverage the power of what she calls “equitable impact” to engage with their customers. “I have seen what businesses can do when you no longer think of impact as a side dish, but the main course.”
- Keep reading, “A moonshot mindset for social impact advantage,” an excerpt from The Social Impact Advantage by Tynesia Boyea-Robinson of CapEQ.
Agents of Impact: Follow the Talent
Clean Energy Ventures promotes Peter Sopher to investment partner and Ted Dillon to chief operating officer… Global Development Incubator, Opportunity Finance Network and Laboratoria are among the more than 1,200 organizations to receive a fresh $2 billion from philanthropist MacKenzie Scott… BlueMark is hiring a remote senior associate of impact investing research… Climate Impact Partners has an opening for a key client communications manager.
Impact startup accelerator Social Alpha is hiring a content writer in Delhi, Bangalore or Mumbai… Dutch bank ING is hiring a vice president/director of sustainable capital markets for its global capital markets division in Amsterdam… Oikocredit seeks a global partnerships officer in Amersfoort, Netherlands… Environmental advisory firm ICF is recruiting a senior consultant of sustainable finance in Brussels.
The Africa Enterprise Challenge Fund seeks a manager of impact and knowledge in Nairobi… Also in Nairobi, the International Rescue Committee is hiring an innovation strategy advisor and a senior communications officer for its impact partnerships… ReFED is accepting applications until Nov. 30 for its catalytic grant fund from innovators with ideas for cutting consumer food waste.
Thank you for your impact!
– Nov. 16, 2022