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European funding group invests in renewable energy in Asia

A ‘fund of funds’ sponsored by the European Commission will invest €12.5 million into a renewable energy fund for Asia.

The Global Energy Efficiency & Renewable Energy Fund (GEEREF), supported by the European Union, Germany and Norway, made the commitment to Berkeley Energy’s Renewable Energy Asia Fund (REAF).  GEEREF has been joined by five other emerging market institutional investors (BIO, CDC, Calvert, DEG and FMO), committing to REAF’s first closing of €51m.

REAF will target India and the rest of Asia, where there are “tremendous opportunities for renewable energy investment,” the group explains. REAF will invest into renewable energy projects in their development stage, transform the investments into operating portfolios and generate high returns through successful exits.

The Fund will focus on wind, solar and small hydro systems which it calls “operationally and economically mature technologies which are best placed to help Asia bridge its current electricity supply/demand gap.” It will be advised by the European Investment Bank Group (European Investment Bank and European Investment Fund) to provide clean energy to emerging countries and economies in transition.

“The European Investment Bank Group and GEEREF have deep in-house experience in the field of renewable energy and will be valuable contributors to this venture’s success,” explains TC Kundi of Berkeley Energy. The private equity fund manager specialises in renewable energy infrastructure investments in developing markets. It has delivered 115 renewable energy generating assets in developed and emerging markets.

Set up by the EU, Germany and Norway in 2008, GEEREF invests in renewable energy and sustainable energy infrastructure funds and similar investment structures. It invests less than €10m, a market niche ignored by private investors and international finance institutions.

Geographically, GEEREF targets funds in the African, Caribbean and Pacific region, non-EU Eastern Europe, Latin America and Asia. The EU, Germany and Norway have committed €108m into GEEREF, which will be invested until 2012.

“We are delighted to announce our commitment to REAF while the COP-15 conference is underway,” says Cyrille Arnould of GEEREF. “GEEREF investments will accelerate the development and deployment of environmentally sound power generation, and thereby help to bring secure and clean energy supplies to people in less privileged regions of the world.”

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