US agency commits $100m to clean energy fund

US President Obama announced the commitment from the Overseas Private Investment Corporation (OPIC) during his recent visit to India.

US government agency the Overseas Private Investment Corporation (OPIC) has committed $100 million to the South Asia Clean Energy Fund (SACEF), which is managed by US-headquartered Global Environment Fund (GEF). 

A White House statement confirmed the investment, which was announced by US President Barack Obama during his recent visit to India. 

The commitment takes the clean energy fund one step closer to its $300 million target. The fund will invest in projects in India’s sustainable energy sector including solar, wind, hydropower, advanced biofuels and natural gas projects.

The OPIC statement also noted that Global Environment Fund would form an India-specific sub-fund in conjunction with the Indian Infrastructure Development Finance Company (IDFC) and other local investors. The two funds would add to what is already a growing pipeline of more than $280 million in “potential OPIC-supported clean energy and energy efficiency projects in India”, the statement said.

Barack
Obama

Some of the South Asia fund's other backers include Manila-headquartered Asian Development Bank, which has made a $20 million commitment, and the International Finance Corporation, which has also invested $20 million.  

George McPherson, a managing director at Global Environment Fund told PEO's sister web site PEI Asia last year that the South Asia fund had raised $100 million and was expecting to see a final close in mid-2010. He also noted then that the fund had several investments in advanced stages of due diligence and was likely to complete its first investment by the second quarter of 2010. The fund’s status following this most recent commitment remains unclear as Global Environment Fund could not be reached by press time.

GEF’s last investment in India took place in November 2009 when the Maryland-based firm paid $46.3 million for a 29.99 percent stake in Hyderabad-based Greenko, an independent power producer focused on the generation of renewable energy. 

That investment was made from the Global Environment Emerging Markets Fund III, which also invests in the clean and renewable energy sector.

The firm also has holdings in other green projects in emerging markets such as Mexico, Hungary and China.  

OPIC is a US government agency which supports US investments in emerging markets.