ALTÉRRA investment vehicle aims to mobilize US$250 billion by 2030 and be fund of choice for climate transition, CEO tells World Governments Summit

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Feb 14, 2024, 03:16 ET

ALTÉRRA was launched at COP28 with a US$30 billion commitment from the UAE, making it the world's largest private investment vehicle for climate change action.
"The vehicle will play a critical role in driving climate investments to where it is most needed to unlock impact at scale to finance the climate economy," HE Ambassador Majid Al Suwaidi, COP28 Director-General and ALTÉRRA CEO said in a panel session.
"The vision for ALTÉRRA was borne out of the COP28 Presidency's Action Agenda focus on making climate finance more available, accessible and affordable to accelerate the global transition," Ambassador Al Suwaidi said.
"ALTÉRRA's structure, scale and scope set it apart from other investment vehicles and will help it become the go-to fund for the climate transition," he added.
ALTÉRRA features an innovative two-part structure, with the first arm, the US$25 billion ALTÉRRA ACCELERATION, designed to steer capital towards investments at scale to accelerate the transition to a net-zero and climate-resilient economy.
The second arm, the US$5 billion ALTÉRRA TRANSFORMATION, is designed to provide risk mitigation capital to incentivize investment flows into the Global South.
ALTÉRRA has a dedicated investment focus on four pillars that underpin the priorities of the COP28 Action Agenda: the energy transition, industrial decarbonization, sustainable living and climate technologies.

DUBAI, UAE, Feb. 14, 2024 /PRNewswire/ -- "ALTÉRRA, the US$30 billion climate investment fund launched at COP28, aims to become the "fund of choice" for the climate transition, with its structure, scale and scope and focus on innovation and partnerships enabling it to steer private markets towards climate investments and focus on transforming emerging markets and developing economies," its chief executive officer said yesterday in a special session at the World Governments Summit.

"The UAE has committed US$30 billion to ALTÉRRA, making it the world's largest private investment vehicle for climate change action, and the fund aims to mobilize US$250 billion globally by 2030," HE Ambassador Majid Al Suwaidi, COP28 Director-General and ALTÉRRA CEO, said in a panel session.

The panel session included Dr. Mahmoud Mohieldin, Executive Director at the International Monetary Fund; Rajiv Dhar, Board Member of the National Infrastructure Investment Fund and Head of US India Green Fund; Arvind Ramamurthy, Chief Market Development Officer at Abu Dhabi Global Market (ADGM); Samir Suleymanov, Director of Finance at COP28 and was moderated by Mercedes Monserrate, CEO of the Global Climate Finance Center (GCFC).

Ambassador Al Suwaidi said, "The vision for ALTÉRRA was borne out of the COP28 Presidency's Action Agenda focus on how we can make climate finance more available, accessible and affordable for all, and remove barriers impeding investment – especially into the Global South. ALTÉRRA is a key element in the COP28 Presidential Action Plan to help drive climate investment to the solutions and markets where it is most needed."

"ALTÉRRA has been designed to be as innovative as possible to maximize its impact and unlock capital flows to tackle challenges head-on," Ambassador Al Suwaidi said.

Arvind Ramamurthy, Chief of Market Development at ADGM, said, "In its commitment to catalyze climate finance amidst global transitions and bolster the UAE's net-zero targets, ADGM is proud to be a home for ALTÉRRA, a groundbreaking initiative with its climate transition funds, and the GCFC, a private-sector-focused think tank and research hub.

"As we navigate challenges to making climate finance universally accessible, ensuring its availability, accessibility, and affordability—the value proposition of ADGM and its sustainable finance framework will be instrumental in strengthening a climate-resilient economy. Collaboratively, they pave the path toward establishing the UAE as the leading hub for comprehensive climate finance initiatives."

Rajiv Dhar, Board Member, National Infrastructure Investment Fund & Head of US India Green Fund, said, "There is a need for blended finance for meeting the climate goals of Global South. ALTÉRRA is a pathbreaking initiative of UAE and has been developing strategies for making a significant impact in Emerging and Developing Economies."

ALTÉRRA features an innovative two-part structure, designed to both bridge the gap in investment into the solutions needed to keep the world on the 1.5C pathway, drive investment into the Global South, and create new investment opportunities and strategies for emerging markets and developing economies (EMDEs).

The first arm, ALTÉRRA ACCELERATION, with US$25 billion, is designed to steer capital towards investments at scale to accelerate the transition to a net-zero and climate-resilient economy. The second arm, the US$5 billion ALTÉRRA TRANSFORMATION, is designed to provide risk mitigation capital to further incentivize investment flows into the Global South.

"Transforming the global economy towards a net-zero and climate-resilient pathway will require a transformation of the climate finance landscape and ALTÉRRA will play a key role in that transformation," Ambassador Al Suwaidi said. "ALTÉRRA's mission is to mobilize investment at scale, stimulating innovation and underpinning the UAE's efforts to create a global green finance ecosystem that can bridge investors and markets and ensures that money flows to where it is most needed, in alignment with the objectives of The UAE Consensus."

"Alongside ALTÉRRA structure and scale, ALTÉRRA's efforts to spur new ideas, incentivize policy and regulatory frameworks, and identify solutions to rapidly deploy capital across the entire value chain of the new climate economy will create a multiplier effect in climate-focused investment, helping it to achieve the target of mobilizing US$250 billion in the next seven years. Innovative partnerships will be key to the success of ALTÉRRA," Ambassador Al Suwaidi said.

"ALTÉRRA is making good progress on the commitments made at COP28, where in collaboration with BlackRock, Brookfield and TPG as inaugural launch partners, it committed US$6.5 billion to climate-dedicated funds for global investments, including the Global South," the ambassador said.

ALTÉRRA is focused on the success of the Emerging Market transition funds launched with Brookfield and TPG that are purpose-built to attract institutional capital into markets that have to date been chronically underinvested.

ALTÉRRA has a dedicated investment focus on four pillars that underpin the priorities of the COP28 Action Agenda: the energy transition, industrial decarbonization, sustainable living and climate technologies.

In total, COP28 mobilized more than US$85 billion in direct climate finance pledges, with 11 pledges and declarations made under the Action Agenda.

ALTÉRRA adds to the UAE's accomplished track record of managing large investment platforms and successfully developing and operating renewable energy projects around the world, leading change as a trusted facilitator at the global crossroads between North, South, East and West. ALTÉRRA is a key component of the UAE's commitment and contribution to climate finance and among the range of finance-led initiatives launched during COP28 to address the climate finance challenge holistically.

Notes to Editors COP28 UAE:

At the historic COP28, countries came together to deliver The UAE Consensus - the most ambitious and comprehensive set of negotiated outcomes to come out of the UNFCCC process since COP21.
The UAE Consensus includes an unprecedented reference to transitioning away from all fossil fuels in energy systems, in a just, orderly and equitable manner in this critical decade to enable the world to reach net zero emissions by 2050, in keeping with the science.
An important opportunity lies in working multilaterally on commitments to deliver high-ambition decisions at COP28, including through The UAE Consensus. This can lead to real economy action for 2030 and help with setting of interim targets that strengthen the NDCs in 2025 in the lead-up to COP30.
The UAE Consensus and the COP28 Action Agenda were launched in response to the Global Stocktake (GST) - a report card on the commitments made at COP21 in Paris. The GST was released just before COP28 and highlighted that the world was significantly off track in meeting the obligations made in Paris. The UAE Consensus and the Action Agenda are decisions in response to these findings and help keep 1.5°C within reach.