BII backs Southeast Asia energy transition fund

The fund has a target of USD 250m and has already received LP commitments from the likes of Asian Infrastructure Investment Bank (AIIB) and European DFIs FMO, Swedfund, Norfund, and OeEB. AIIB announced it would contribute USD 50m – with co-investment rights amounting to another USD 50m – as long ago as December 2019. Austria’s OeEB confirmed its USD 8.5m investment in December 2022.

BII said the commitment represents its first in Southeast Asia since the announcement of plans to re-enter the region and provide capital to “boost clean and sustainable economic growth and support the region’s green energy transition.” It wants to invest up to GBP 500m (USD 623m) in climate finance in Indo-Pacific by 2026 – part of an effort to have climate finance account for 30% of total new commitments.

In May 2022, BII told AVCJ that it would push deeper into South Asia – it is an established player in India – and expand into Southeast Asia. A Singapore office opened later that year. BII wants its entire portfolio to achieve net zero emissions by 2050. About USD 1b was invested in climate projects between 2017 and 2020. It said that number would likely hit GBP 3bn over the next five years.

Susi Asia Energy Transition Fund (SAETF) targets infrastructure investments across the energy transition spectrum, including renewable energy, energy efficiency, and energy storage projects. Southeast Asia’s emerging economies, including Indonesia, Vietnam and the Philippines, are the main area of focus.

BII noted that almost all the countries in Southeast Asia have seen their economies double in size since 2000, which means energy demand in the region has increased by an annual average of around 3% over the past two decades. Indonesia and Vietnam are among six Southeast Asian countries to announce net zero emissions and carbon neutrality targets.

These sustainability ambitions require at least USD 200bn of energy sector investment by 2030, of which over three-quarters needs to be channelled into clean energy, according to a study by the International Energy Agency and Imperial College London.

“SAETF is an excellent re-entry point for BII into Southeast Asia and a clear statement of our ambition to provide climate finance and support innovation to meet the challenges from the climate crisis,” Srini Nagarajan, a managing director and head of Asia at BII, said in a statement.

Founded in 2009, Susi is a specialist sustainable energy infrastructure investor with EUR 1.9bn (USD 2bn) in capital commitments from institutional investors. It has participated in more than 140 transactions across 20 countries to date through private equity and credit strategies.

SAETF has already made four investments. It is working with Singapore-based Entoria Energy on three rooftop solar joint ventures, with Malaysia’s InvestEnergy on several energy efficiency projects, and with Pacific Impact on utility-scale renewable energy projects across the region. The fund has also backed Asia Clean Capital Vietnam, a solar developer for commercial and industrial customers in Vietnam.

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• Topics
• Southeast Asia
• Fundraising
• Infrastructure
• Infrastructure
• LPs
• GPs
• Cleantech
• British International Investment (BII)
• Susi Partners
• energy
• renewable energy
• Fundraising