OPIC Board Approves $175 Million for Two Renewable Energy Investment Funds
June 19, 2012
TPG and GEF to help bring latest technologies to reduce environmental impact in Latin America, Southeast Asia & Sub-Saharan Africa
WASHINGTON, D.C. – The Board of Directors of the Overseas Private Investment Corporation (OPIC), the U.S. Government's development finance institution, approved $175 million in financing for two new investment funds that will bring the latest renewable energy technologies to emerging markets in Latin America, Southeast Asia and Sub-Saharan Africa, helping to lay the foundation for the sector's growth in those regions for years to come.
The Board approved $125 million in financing for TPG Alternative & Renewable Technologies Partners (TPG ART). TPG will invest in companies matching the best renewable technologies from the United States and Europe to markets in Latin America and Southeast Asia. TPG will also support the adoption of renewable technologies that will have a lower environmental impact than the traditional methods of energy generation used today.
"Taking the latest renewable energy technologies and applying them to emerging markets is one of the great development challenges of the coming years. Be it converting local biomass to high-value products, improving energy storage, or making use of state-of-the-art building materials, the technologies invested in by this fund will represent an important step toward meeting that challenge," said OPIC President and CEO Elizabeth Littlefield.
The Board also approved $50 million for the GEF Africa Growth Fund, which will invest in environment-related energy infrastructure across Sub-Saharan Africa in order to improve the efficiency of energy and agribusiness production in the region. The fund will target investments in clean electricity generation; energy management systems; distribution infrastructure; energy efficiency technologies and services; and companies which promote sustainable management and harvesting of timber and agriculture. The fund has a target capitalization of $150 million.
GEF's investments in clean and renewable forms of energy will help offset the increased demand for fossil?fuel power generation in the subcontinent. Rapid economic growth across Africa has resulted in a significant electricity shortage that requires a dependence on costly diesel generators or improvised kerosene lighting. Similarly, the expansion is prompting higher levels of food consumption, which is expected to grow by 2.6 percent annually through 2018.
"Rising energy demand and food consumption in Sub-Saharan Africa makes the connection between renewable energy and agribusiness critical to the subcontinent's future," said Ms. Littlefield. "The GEF Africa Growth Fund will make investments that accelerate the development of Africa's energy infrastructure, particularly in industries that can raise agribusiness output to meet consumption needs."
TPG ART is managed by TPG , a leading global private investment firm founded in 1992 with $51.5 billion of assets under management and offices in Fort Worth, San Francisco, Beijing, Chongqing, Hong Kong, Houston, London, Luxembourg, Melbourne, Moscow, Mumbai, New York, Paris, São Paulo, Shanghai, Singapore and Tokyo.
GEF Africa Growth Fund is managed by GEF Management Corporation, founded in 1990 with the objective of making investments in growing companies that make positive contributions to the global environment, human health, and the quality of life.
OPIC is the U.S. Government's development finance institution. It mobilizes private capital to help solve critical development challenges and in doing so, advances U.S. foreign policy. Because OPIC works with the U.S. private sector, it helps U.S. businesses gain footholds in emerging markets catalyzing revenues, jobs and growth opportunities both at home and abroad. OPIC achieves its mission by providing investors with financing, guarantees, political risk insurance, and support for private equity investment funds.
Established as an agency of the U.S. Government in 1971, OPIC operates on a self-sustaining basis at no net cost to American taxpayers. OPIC services are available for new and expanding business enterprises in more than 150 countries worldwide. To date, OPIC has supported more than $200 billion of investment in over 4,000 projects, generated an estimated $75 billion in U.S. exports and supported more than 276,000 American jobs.