SCF

Global investments accelerating local
action for a sustainable future

The Subnational Climate Finance initiative (SCF) is a global blended finance initiative that aims to invest in and scale mid-sized climate resilient, low-carbon infrastructure and nature-based solutions in developing countries.

The SCF is an impact investment fund with a differentiated structure seeking to create attractive market opportunities:

Blended finance, a grant-funded technical assistance facility and support of the Green Climate Fund with a concessional investment into the SCF of up to $150m.

Funding what matters

Subnational climate-smart infrastructure and nature-based solutions delivering measurable and certified SDG impact at the local level:

investing in mid-sized climate-resilient projects at subnational level to drive strong returns and impact with environmental and social safeguards.

"It is of great satisfaction to have been able to successfully develop a dedicated blended finance vehicle at sub-national level, especially since the Paris Agreement has officially recognized that 50-80% of climate change solutions stand within the hands of sub-national authorities. Our experience, around the world, in delivering mid-sized low carbon and climate resilient infrastructure show that sub-national authorities meet a lot of obstacles to access the green finance market. SCF sends a clear signal to the climate change community in general to the finance leaders in particular, to be a game changer in climate change investment in emerging markets at sub-national level."

Christophe Nuttall

CEO, R20: Regions of Climate Action

“The GCF is delighted to support the Consortium formed by Pegasus Capital Advisors (PCA), IUCN, BNP Paribas, Regions 20 and Gold Standard to launch an equity fund that will support small- and medium-sized sustainable infrastructure projects in developing countries, including 13 Least Developed countries (LDCs) and 6 Small Island Developing States (SIDS). Providing finance to financially underserved sub-national projects is a priority for the UNFCCC and the Paris Accord.”

Yannick Glemarec

GCF Executive Director

"The GCF Funds group has worked closely with the Consortium to structure the first commercial equity fund for climate projects at the sub-national level in developing countries with institutional investors' quality. The Fund's objective to create a positive demonstration effect by mobilizing private investment at scale for sub-national projects is substantial."

Sergio Pombo

Head, Private Equity Funds, GCF

"I am thrilled that we have launched this innovative blended finance effort with such a terrific group of partners. I am very grateful for the leadership role taken by the Green Climate Fund and the support of the many countries who have agreed to work with us. I believe with our partners we will unlock private capital to invest in needed and financially sound projects at the sub-national level across multiple sectors and geographies. We need to accelerate dramatically the pace of this capital and investment."

Craig Cogut

Founder, Chairman & CEO, Pegasus Capital Advisors

"The private and public sectors need to work together to fast track nature-based solutions which benefit the environment, societies, and investors alike, with positive impacts on climate and societal resilience. IUCN has long championed this approach, and will lean on the Union's expertise to ensure that investments by the SCF are not just financially, but also environmentally and socially sound."

Dr Bruno Oberle

Director General IUCN

"Achievement of the UN's Sustainable Development Goals and the Paris Agreement requires the scaling up and mobilisation of capital, shared knowledge and innovation from across a full spectrum of investment and impact experts. This initiative is ground-breaking in tackling the climate crisis by leveraging the expertise of leading institutions, including the Green Climate Fund, to channel finance towards infrastructure, energy transition, and nature-based solutions. BNP Paribas looks forward to advancing SCF by bringing the full strength of the bank and our depth of experience in sustainable finance to the consortium to accelerate the impact of the identified sub-national projects around the world."

Alain Papiasse

Chairman of Corporate & Institutional Banking, BNP Paribas

"With an increasing interest in sustainable finance, it's critical that these instruments deliver what they claim. Impact certification gives participants across the value chain confidence that outcomes are real, measurable and verified, and tells the global community what exactly progress is being made toward global ambitions codified in the Paris Agreement and the Sustainable Development Goals."

Margaret Kim

CEO, Gold Standard

Key Components

As an innovative global blended finance initiative, SCF will seek to scale this untapped market of mid-sized climate resilient and low-carbon infrastructure, regenerative agriculture and nature-based solutions in developing countries through four key components:

An investment fund managed by Pegasus Capital Advisors

which will invest in a global portfolio of mid-sized infrastructure projects in the fields of sustainable energy, waste and sanitation, and nature-based solutions in developing countries.

A grant-funded dedicated technical assistance facility managed by the International Union for Conservation of Nature (IUCN)

with a target size of USD 28 million, of which USD 18.5 million have already been committed by the Green Climate Fund. Through this facility, IUCN will provide technical assistance in identifying suitable projects for the fund to invest in, and train implementers to ensure that projects are feasible and deliver environmental and social benefits in addition to financial performance.

The Green Climate Fund (GCF) as an anchor investor and partner

has already committed a first-loss tranche of up to USD 150 million, which is intended to mitigate risk at the fund level, thereby bridging the gap between public and private investors.

A partnership of consortium members

providing leading expertise along the entire value chain.

News & Insights

Get in touch with SCF

Location
750 East Main Street, Suite 600
Stamford
CT 06902

Contact
1-203-869-4400
1-203-869-6940

investorrelations@pcalp.com