© Dana Smillie / World Bank
The impacts of climate change are already being felt around the globe. The sea level is rising, while heat waves are more intense than in the past. These adverse effects are expected to intensify in the next few decades, hitting poor countries hardest.
Without concerted action, the warming planet threatens to roll back decades of development progress.
To discuss a new global agreement that would limit global warming, government representatives of 190 nations and hundreds of multi-sectoral world leaders gathered in France in December, for the United Nations’ Climate Change Conference—COP21.
The private sector is an important part of the climate solution. An increasing number of companies are taking action to address the challenge—either by reducing their own emissions or expanding their businesses if they contribute to climate-change mitigation and adaptation. But the right policies and financial products must be in place so businesses can innovate and expand to solve this puzzle.
Since 2005, IFC has invested more than $13 billion to support projects in renewable power, energy efficiency, sustainable agriculture, green buildings, and adaptation to climate change. Through its advisory services, IFC has also enabled $5.4 billion in climate-related investment projects. These investments have generated market-rate returns, demonstrating that environmentally responsible projects can be profitable as well.
IFC hosted a panel discussion during COP21 as part of the Caring for Climate Business Forum. What Will It Take to Scale up Climate-smart Investments in Emerging Markets? Perspectives from Business Leaders showcased IFC emerging-markets clients who have demonstrated exceptional leadership in advancing climate-smart solutions in various industries.
What Our Clients Are Doing
International Housing Solutions (IHS) is a South African private equity firm focused on residential housing in emerging markets. By partnering with financial institutions, private-capital groups, and local governments, the company has helped thousands of low- to middle-income individuals and families afford a home of their own.
IFC has invested in several IHS Funds, including $10 million in IHS Fund II, drawing from Global Environment Facility (GEF) funds and with co-investment from the South Africa National Housing Finance Corporation and the Eskom Pension Fund. This funding will support the development of affordable green homes certified by IFC’s EDGE (Excellence in Design for Greater Efficiencies), a program that calculates operational savings and reduced carbon emissions for buildings.
Azure Power is India’s leading independent solar power producer. By providing solar energy as a service, the company manages the entire project process for its customers, reduces costs of generating electricity, and provides long term predictable pricing.
IFC has supported Azure with loans to construct and operate a 2.5 MW rooftop solar-power project for the government in the state of Gujarat and a 40 MW solar-power plant in the state of Rajasthan. We are currently exploring a loan for the development of a 130 MW solar-power plant in the state of Karnataka.
The Mahindra Group is a large conglomerate spanning 18 key industries, including agribusiness, energy, finance, and real estate. The group is active in tackling climate change, having set ambitious targets for its future development in a low-carbon growth scenario.
One of the Special Economic Zones by Mahindra Group in Jaipur has become the first project in Asia—and the sixth in the world—to commit to a carbon-positive road map as part of the C40 Cities Climate Leadership Group, a network of the world’s megacities committed to addressing climate change. The Mahindra Group is also a supporter of the Carbon Pricing Panel, a group convened to accelerate public and private sector action for carbon pricing toward a sustainable and resilient future.
The Solar Power Company Group (SPCG) is the largest solar power generation company in Thailand. Supported by finance from IFC, the company has unlocked private financing to construct a total of 36 solar photovoltaic farms, accounting for 250 MW of installed capacity by the end of 2014. This new generation capacity helps avoid over 200,000 tons of CO2 equivalent emissions annually—the equivalent of taking more than 40,000 cars off the road.
SPCG and its CEO, Wandee Khunchornyakong, have been recognized by the UN Climate Change secretariat with the prestigious Momentum for Change—Women for Results award, honoring projects from around the world that address climate change as well as wider economic, social and environmental challenges.
Hexagon invests in Turkey’s alternative energy future through wind and waste management projects. Hexagon Solid Waste provides services including education on source separation, solid waste collection and treatment, recycling, electricity production, fertilizer production, and landfill construction and operation.
IFC arranged a $95 million financing package to Hexagon Solid Waste to generate energy and convert municipal, industrial, and agricultural waste into high-quality organic content fertilizer.