British International Investment (BII), a UK development finance institution and impact investor, has announced a plan to invest $15 million in the SUSI Asia Energy Transition Fund (SAETF), a Southeast Asia-focused energy transition infrastructure fund managed by Swiss-based firm SUSI Partners.
The investment marks the start of realizing BII’s ambitions to invest up to £500 million ($622.3 million) of climate finance in the Indo-Pacific region and forms part of its overall goal to target 30 per cent of total new commitments to climate finance.
SAETF targets infrastructure investments across the energy transition spectrum, including renewable energy, energy efficiency, and energy storage projects, and focuses on emerging economies in Southeast Asia, including Vietnam.
The Fund will contribute to global climate mitigation goals and the Paris Agreement by financing clean energy solutions, increasing the supply of reliable and affordable electricity for businesses and consumers, and enabling access to clean energy solutions in underserved areas.
Southeast Asia has been one of the fastest-growing regions in the world. While countries are in various stages of development, almost all economies have more than doubled in size since 2000. This means that energy demand in the region has increased on average by around 3 per cent a year over the past two decades.
To address this growing energy demand and reduce dependence on fossil fuel generation, six Southeast Asian countries, including Vietnam, have announced net-zero emissions and carbon neutrality targets. These sustainability ambitions require at least $200 billion of energy sector investment by 2030, of which over three-quarters needs to be channeled into clean energy.
BII’s investment is aimed at attracting further commercial investors to unleash climate finance opportunities and support green, resilient economic growth in the region.
SUSI Partners has recently announced an investment in Asia Clean Capital Vietnam, a solar developer for commercial and industrial customers in Vietnam. It reiterates the renewed approach to investing in climate finance in Vietnam as one of BII’s priority markets in the Indo-Pacific region.
Mr. Wymen Chan, Head of Asia at SUSI Partners, said that energy demand in Southeast Asia is growing fast in line with the region’s economic development. “Our goal is to direct capital towards the buildout of infrastructure that allows this growth to occur in a sustainable manner while proving that Southeast Asia is not just an impactful but also a highly attractive market for public and private investors alike.”
“We have been investing across Asia for over 30 years,” said Mr. Srini Nagarajan, Managing Director and Head of Asia at BII. “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. We laud the region’s climate ambitions and look forward to collaborating with SUSI’s local teams to further develop scalable and bankable sustainable projects.”
The commitment from BII will contribute to the United Nations’ Sustainable Development Goals on Affordable and Clean Energy (SDG 7), Decent Work and Economic Growth (SDG 8), and Climate Action (SDG 13).