The UK Government, alongside other countries, has announced first close of a private finance initiative worth $281 million (£177m) which will be invested towards tackling climate change.
Cash from the International Finance Corporation (IFC) Catalyst Fund will be used in projects in developing countries, which will focus on renewable energy and efficiency projects. The IFC, Canada and the State Oil Fund of the Republic of Azerbaijan (SOFAZ) made investments, with the UK contributing $80 million (£50m) from its International Climate Fund.
Greg Barker, Energy and Climate Change Minister said: “Private sector investment is crucial to achieving the scale of finance needed to mitigate against dangerous climate change and adapt to its effects. This is why the UK is committed to using our international climate finance to support developing economies to accelerate private sector investment in low carbon, climate friendly projects.
“I am delighted that the IFC Catalyst Fund has reached this milestone. This is an important first step to the Fund going on to catalyse further investment in to innovative climate projects and transform the private equity market.”
The fund aims to speed up private finance into climate change investments and according to DECC, is crucial to build the $4.3 trillion (£2.7tn) low carbon infrastructure – more than 75% of which is needed in developing countries.