The topic of private sector mobilization for addressing climate change is not new; indeed the issue of private investment in clean energy was featured prominently in climate policy discussions even before the Copenhagen Accord in 2009, at which countries agreed to mobilize $100 billion in public and private money for climate change-mitigating efforts in developing countries. But while there is no shortage of private funds for investment per se, there continue to be too few bankable projects in which to invest.
This is where the REEEP Investment Accelerator comes in. REEEP is working to address what the International Finance Corporation has termed "the missing middle" - the valley of death transition from concessional funding to growth-stage commercial investment. REEEP’s investment accelerator bridges the gap between early project viability and sustainable market success. The accelerator strengthens entrepreneurs – through business training, mentoring and best-practice consulting drawn from the project portfolio – and enterprises – through targeted financial injections to “de-risk” projects.
REEEP has taken up this challenge and brought in our first partner, CTI PFAN, a network of private investors active in the clean energy sector. Together we are running a "Phased Financing Facility." Entrepreneurs selected for the REEEP portfolio are brought into a multi-year incubator program, including seed-level grants of up to €250,000 and access to the REEEP network. Entrepreneurs are provided with business training and mentoring by CTI PFAN, and best-practice consulting by REEEP drawn from our portfolio. Projects are vetted by CTI PFAN investment professionals, and receive targeted “de-risking” support to ensure bankability. CTI PFAN will facilitate direct connections to private investors.
Over the next four years, REEEP seeks to leverage €50 million of donor funding through the Enterprise Portfolio into €1 billion of private investment into clean energy projects.