🌏 Alterra’s $30B bridge for climate financing #176

Happy Monday!

And happy COPing to those on the ground in Dubai! The first few days of COP have ushered in a wave of major announcements and funding pledges. Notably, the UAE unveiled a $30B fund to finance global climate solutions across the capital stack, with a dedicated focus on emerging markets. Countries and companies have also kicked off pledges to triple investments in renewables and nuclear, drive down methane emissions, and commit loss and damage funds.

In deals, major funding includes $116M for hydrogen-powered aviation, $44M for sustainability software, and $75M in project finance investment for SAFs. In new funds, energy transition infrastructure is bringing in the big bucks with Brookfield's record-breaking $28B infra fund and Antin's $1.2B sustainable infra fund.

P.S. We’re hiring for an Account Exec at Sightline Climate, apply here.

Thanks for reading!

Not a subscriber yet?

Subscribe Button here

📩 Submit deals and announcements for the newsletter at [email protected].

💼 Find or share roles on our job board here.

$30B to bridge the climate finance gap

On day 2 of COP28, the United Arab Emirates (UAE) revealed Alterra, a $30B climate fund for global climate solutions self-described as the world’s largest private investment vehicle for climate action.

The whopping $30B fund will be split into “Acceleration” and “Transformation” and will target deploying $250B by 2030.

Alterra Acceleration: $25B to anchor and co-invest in large-scale climate projects
Alterra Transformation: $5B of risk mitigation capital in the Global South and Emerging Markets / Developing Economies

Alterra has also teamed up with three climate PE heavy-weights; Blackrock, TPG, and Brookfield as inaugural partners to allocate the initial $6.5B in climate commitments. The Acceleration and Transformation funds have already started to make their way into major venture capital, private equity, debt, and infra funds across the climate capital stack:

Blackrock

$1B go BlackRock’s recently announced Climate Transition-Oriented Private Debt strategy
$650M to Blackrock’s $5.1B Global Infrastructure Fund IV
$100M co-investment alongside BlackRock’s Climate Financing Partnership aimed at climate infra in emerging markets
$250M to a yet-to-be-announced BlackRock managed strategy

Brookfield

$1B to investment into the newly launched Brookfield Catalytic Transition Fund focused on emerging markets
$2B for Brookfield’s Second Global Transition Fund

TPG

$1B to the TPG Rise Climate II Fund and another $1B for co-investment
$500M commitment into TPG’s $10B Global South Initiative

For now, Alterra is structured to create new investment vehicles with, and co-invest through, partners’ existing funds. Near-term commitments include 6 GW of clean energy in India alongside considerations for wind and solar in Africa and rural electrification in Latin America.

The highs and the lows

Empowering the Global South. Alterra marks a groundbreaking commitment to provide necessary funding for the energy transition in the Global South, including Least Developed Countries (LDCs) and Small Island Developing States (SIDS). This injection of institutional capital could send a strong signal to catalyze more private investors, potentially reducing the cost of capital and spurring more significant investments.
Chairman controversy. The appointment of Sultan Dr. Al Jaber as Chairman of Alterra, and also host of COP28, has already stirred controversy due to his role as President of ADNOC and rumored intention to broker fossil fuel deals during COP.
Execution questions marks. Critics point out that Alterra lacks clear timelines for distributing its initial $6.5B and raising the remaining $23.5 billion needed to reach its $250 billion goal by 2030. Furthermore, worries persist that most distributions will take the form of market-rate loans, potentially burdening beneficiary countries with crippling debt.
Private sector revival. Despite the reservations, Alterra represents a potential re-emergence of the private sector on the COP scene. Whereas COP27 saw a dearth of C-Suites, this COP has witnessed a mobilization of private sector funding for climate financing in the Global South.

Deals of the Week (11/20-12/3)

Late-Stage / Growth

✈️ ZeroAvia, a Hollister, CA-based hydrogen plane developer, raised $116M in Series C funding from UK Infrastructure Bank, Breakthrough, Airbus, Barclays, and NEOM.

🏗 One Click LCA, a Helsinki, Finland-based end-to-end sustainability software platform, raised $44M in Growth funding from PSG Equity and InfraVia Capital Partners.

🌾 Planet Farms, a Milan, Italy-based vertical farming developer, raised $40M in Growth funding.

🏭 Newheat, a Bordeaux, France-based solar thermal developer, raised $33M in Growth funding from SWEN Capital Partners, Noria, Bpifrance, the Etchart Group, and Holdheat.

⚒️ Adionics, a Thiais, France-based direct lithium extraction technology platform, raised $27M in Series B funding from Bpifrance, SQM, Supernova Invest, Céleste Management, and Ovive.

☀️ TSUN, a SuZhou, China-based solar panel manufacturer, raised $21M in Series B funding from IDG Capital.

🛵 EMotorad, a Pune, India-based electric bike marketplace, raised $20M in Series B funding from Panthera Growth Partners, xto10x Technologies, and Green Frontier Capital.

💨 Solar Foods, a Helsinki, Finland-based CO2 to proteins developer, raised $9M in Series B funding from Springvest, Happiness Capital, and Lifeline Ventures.

Early-Stage

🚗 Advanced Electric Machines (AEM), a North Sunderland, UK-based electric vehicles design and manufacturer, raised $29M in Series A funding from Legal & General Capital and Barclays.

🌾 Red Horticulture, a Lyon, France-based agricultural lighting for crop yield developer, raised $19M in Series A funding from the European Circular Bioeconomy Fund and Demeter.

🔋 Modo Energy, a Birmingham, UK-based battery analytics platform, raised $15M in Series A funding from MMC Ventures, Triple Point Ventures, Fred Olsen Limited, and Catalyst Capital.

💨 Again Bio, a Copenhagen, Denmark-based carbon-negative chemical production platform, raised $10M in Seed funding from ACME Capital, Atlantic Labs, and Google Ventures.

⚡ GoMetro, a Durban, South Africa-based fleet management optimization software developer, raised $10M in Series A funding from Zenobē, FutureGrowth, Decades Capital, Hlayisani Capital, Tritech Global, and other investors.

🛵 Baaz Bikes, a New Delhi, India-based electric scooter manufacturer, raised $8M in Series A funding from Big Capital, Rakuten Capital, Kalaari Capital, and 9Unicorns.

🍎 Ryp Labs, a Bothell, Washington-based food waste reduction technology developer, raised $8M in Series A funding from King Philanthropies, Good Investors, BCP Ventures, Argosy Foundation, and Ocean Born Foundation.

🛵HumanForest, a London, UK-based e-bike service platform, raised $6M in Series A funding from Güil Mobility Ventures, Fen Ventures, and Triodos Bank UK.

🌱 Vizcab, a Lyon, France-based carbon impact analysis software developer, raised $6M in Series A funding from Kompas Ventures and Cemex Ventures.

🌳 Cambium Carbon, a Baltimore, MD-based carbon negative wood supply chain platform, raised $5M in Seed funding from MaC Venture Capital, Alumni Ventures, Avesta Fund, Connecticut Innovations, Gaingels, and other investors.

💸 Climate Alpha, a Singapore, Singapore-based AI-powered climate analytics platform, raised $5M in Seed funding from Jungle Ventures.

⚡ Generative Engineering, a London, United Kingdom-based design and engineering software developer, raised $4M in Pre-Seed funding from EQT Ventures and Join Capital.

🛰 Amini, a Nairobi, Kenya-based AI-driven environmental monitoring data platform, raised $4M in Seed funding from Salesforce Ventures, Satgana, Superorganism, and Pale Blue Dot.

⚡ Monterra, a San Francisco, CA-based EV charging design automation platform, raised $3M in Pre-Seed funding from Base10 Partners, Future Climate Venture Studio, and Very Serious Ventures.

💨 Floreon, a City of Kingston upon Hull, UK-based bioplastics developer, raised $3M in Series A funding from Northern Gritstone.

💨 Yard Stick, an Oakland, CA-based soil carbon monitoring platform, raised an additional $1.5M in Series A funding from Extantia, Toyota Ventures Climate Fund, Microsoft Climate Innovation Fund, The Nature Conservancy, Lowercarbon Capital, Breakthrough Energy Ventures, Pillar VC, and others.

Other

⚡ mylight150, a Lyon, France-based solar and smart energy management solutions platform, raised $109M in funding from Eiffel Investment Group, Azora Capital, Andera Partners, and Elevation Capital Partners.

⚡ Infinium, a Sacramento, CA-based electrofuels developer, raised $75M in project finance from Breakthrough.

🥩 Liberation Labs, a Queens, NY-based precision fermentation for alternative proteins developer, raised $25M in Debt funding from U.S. Department of Agriculture.

🔋 Malta, a Cambridge, MA-based pumped heat energy storage developer, raised an undisclosed amount in funding from Siemens Energy Ventures, Alfa Laval, Breakthrough, Chevron Technology Ventures, Piva Capital, and other investors.

Exits

🌱 Climate Draft, a Portland, OR-based climate jobs platform, was acquired by Lowercarbon Capital for an undisclosed amount.

⚡ Bonnet, a London, UK-based EV charging subscription service company, was acquired by OVO for an undisclosed amount.

🏠 Veev, a Hayward, CA-based modular proptech company, is going out of business.

New Funds

Alterra, a Dubai, United Arab Emirates-based investment firm, launched a $30B fund to invest in the climate transition.

Brookfield, a Toronto, Canada-based investment firm, closed their $28B flagship fund to invest in infrastructure that supports the energy transition.

Antin Infrastructure Partners, a Paris, France-based investment firm, closed their NextGen $1.3B fund that invests in sustainable infrastructure.

Kinterra Capital, a Toronto, Canada-based investment firm, closed their $565m debut fund that invests in critical mineral assets for battery development.

Invest-NL, an Amsterdam, Netherlands-based investment firm, launched a $217M fund to invest in Dutch climate tech companies.

Resolve Ventures, a Dublin, Republic of Ireland-based investment firm, launched a $33M fund to invest in Irish-based climate tech companies.

Can’t get enough deals? See full listings and deal analytics on Sightline Climate

Request a Sightline Climate demo

In the News

Let the COP commitments commence! So far,

116 countries pledged to triple their renewable energy generation capacity to 11,000 GW.
50 companies, representing over 40% global oil production, committed to reduce methane emissions to 0.2% of oil and gas production by 2030 and total net-zero operations by 2050.
22 countries pledged to triple their nuclear capacity by 2050, including the US, UK and other European nations.
52 countries pledged to reduce their global cooling emissions by 68% through 2050.
The Industrial Transition Accelerator was launched, with the aim of accelerating decarbonization across heavy industries, transport and energy, together representing 65% of emissions.
27 countries signed the UAE Hydrogen Declaration of Intent endorsing a global hydrogen certification standard.

On the first day of COP28, the Loss and Damages fund was approved. Countries including the UAE, EU, Germany, UK, USA and Japan pledged an initial $549M (keep track here). However, climate-related damages are expected to cost developing countries $280-580B per year by 2030.

Virgin Atlantic flew the first 100% bio-SAF commercial flight from London to New York, with Sir Richard Branson aboard himself. The flight comes in the wake of a recent surge in corporate SAF announcements from Rolls-Royce and other European airline services.

Geothermal developer Fervo broke new ground when its first of a kind 3.5 MW enhanced geothermal system (EGS) began delivering power to the Nevada grid. Google, who co-funded the project as part of its 24/7 carbon free energy commitment, will use the plant to power nearby data centers. [Want more on the heat beneath our feet?].

Microsoft and the UNFCCC partnered to develop an AI-powered climate data analysis platform to enable the UN to act as a third party verifier and measure countries progress towards the Paris Agreement goals.

The Department of Energy gave heat pumps a big boost. 13 states and 9 manufacturers received $169M to help develop air-to-air, air-to-water and geothermal heat pump tech while expediting nationwide manufacturing. DOE also funneled $275M into seven projects to strengthen clean energy supply chains, including new facilities for Boston Metal and LuxWall.

Equinor-BP’s 2.1 GW Empire Wind received federal approval, providing a much needed tailwind for the offshore industry. The New York project comes in the wake of two recently canceled Orsted Atlantic coast wind farms.

In a flurry of new tax credit guidance, the IRS permitted the US government to subsidize interconnection costs for the first time. Estimates show the changes could save large solar and wind developers over $10M in project costs. [See our issue on interconnection issues here].

Breakthrough has been busy. Over the last two weeks, Breakthrough Energy Catalyst announced:

A partnership with European Investment Bank (“EIB”) to mobilize up to €840 million of public and private funds to accelerate emerging climate technologies
€35 million to support construction of Energy Dome’s Ottana CO2 Battery Project
A 15% equity interest in Ørsted’s FlagshipONE project
A $75 million equity commitment to Infinium’s Project Roadrunner

The world’s biggest experimental nuclear fusion reactor launched in Naka, Japan. The JT-60SA reactor, a joint project between the European Union and Japan, aims to explore the potential of fusion as a secure, extensive, and carbon-free source of energy.

Pop-up

Meet the latest class of Forbes 30 under 30, including climate tech familiar faces Brennan from Patch, Keeton from Holocene, and Marisa from Conduit Tech.

Can’t keep track of all the pledges? Keep count using this COP28 Climate Funds Pledge Tracker from NRDC.

CDR with one click. Stripe launches Climate Orders for businesses to pre-order carbon removal.

Check out these NYT interactive graphs to see how your country’s electricity sources stack up.

Take a load off (the grid) with these repurposed wind turbine park benches.

A well-Time(d) profile on Sultan Al Jaber leading COP.

Hot off the press: COP28 report roundup.

BCG sounds the alarm on the $18T net zero capital gap.

Avocados: meat-free, not guilt-free.

The world’s biggest iceberg is on the move.

Rhodium’s latest crystal ball on GHG emissions and temp rise out to 2100.

A tool to tell where a tree grows in Brooklyn.

Opportunities & Events

🗓️ COP28: Navigating COP this year? The UN Climate Conference is underway in Dubai from Nov 30th - Dec 12th. Find various events using the following trackers from Kompas VC and others. And if you’re in town, say hi to Kim and Mark!

🗓️ COP28 (virtual): Register for McKinsey Sustainability’s virtual COP28 program or Bloomberg Green from Dec 4th-5th.

💡 MIT Climate and Energy Prize: Apply by Dec 7th (for early bird benefits) or by Jan 7th to MIT’s Climate and Energy Prize to receive over $100K in prize money, mentorship, and continued support for your startup.

️ 🗓️ Clean Energy Investment Symposium: Attend the Clean Energy Investment Symposium from Dec 5th-7th to learn from experts and panelists, and participate in numerous networking events.

💡 NextEra Energy Investments Seed Competition: Apply by Dec 8th to NextEra Energy Investment’s seed investment competition for pre-Series A companies specializing in Cybersecurity, Data & AI, Decarbonization and Energy Transition.

💡 Respond Accelerator: Apply to the RESPOND Accelerator by Dec 17th to receive opportunities, connections, and support for your technology that contributes to a more sustainable economy.