Brookfield Asset Management & ALTÉRRA launch fund to drive clean energy investments in emerging markets
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Mark Carney, Chair and Head of Transition Investing at Brookfield Asset Management said, “The Catalytic Transition Fund is a private market solution to the global challenge of delivering transition investment to emerging markets. Brookfield is already a leading transition investor in these regions and has first-hand knowledge of the incredible opportunity and impact that is available in these chronically underfunded markets.”
He added, “Having this dedicated capital for emerging markets will complement our existing Brookfield Global Transition Fund strategy and further accelerate the growth of clean energy and transition investments in the future.”
Key Points
Brookfield Asset Management and ALTÉRRA Management Limited have jointly launched the Catalytic Transition Fund (CTF) to drive clean energy investments in emerging markets, according to a press release by Brookfield.
The fund, managed by Brookfield, aims to channel resources into clean energy and transition assets in emerging economies. Its first close is anticipated by the end of 2024.
ALTÉRRA has committed $1 billion to the CTF to support the transition, with the goal of accumulating $5 billion in total capital for deployment into emerging markets.
Background
ALTÉRRA, launched during COP28 in Dubai, is positioned as the world’s largest private investment vehicle for climate finance, committed to catalyzing $30 billion in climate investments and gathering $250 billion by 2030 with its partners.
CTF was introduced in December 2023, and since then, Brookfield Asset Management has been formulating investment strategies and engaging potential partners.
Emerging economies face disparities between emissions and investments in clean energies. Less than 15% of global investment is directed towards clean energy in these regions despite their contributing nearly one-third of global emissions.
To meet the targets outlined in the Paris Agreement, investments in clean energy must increase sixfold, reaching $1.6 trillion annually by the early 2030s.
The goal of the fund is to direct capital towards clean energy investments in these countries and economies.
The CTF employs a novel approach to attract capital for clean energy and transition assets in emerging markets. It aims to accelerate decarbonization investments while generating attractive risk-adjusted returns.
ALTÉRRA’s commitment to the CTF includes a capped return, which enhances risk-adjusted returns for investors and unlocks attractive investment opportunities.
CTF’s capital will be deployed in targeted emerging markets across South and Central America, South and Southeast Asia, the Middle East, and Eastern Europe.
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