Carbon Growth Partners (CGP) - an Australia-based investment company that describes itself as the world’s first investment manager in the voluntary carbon market - secured a US$10-million investment from Singapore-based Silverstrand Capital to close its second fund, the Carbon Growth Fund.  It has raised US$30 million out of its US$100-million initial target.

The fund aims to generate investment returns, while protecting and restoring nature, and accelerating climate action. It will invest in projects that deliver co-benefits to forests, grasslands and wetlands, and the people who rely on them, as well as to bring high-quality carbon offset solutions to “responsible” businesses.

It will invest in “highest integrity” carbon credits, such as those issued by the Verified Carbon Standard (Verra) and the Gold Standard Foundation.

“Carbon credits provide a way to deliver finance to the people and places that need it the most and which can have the most positive impact on climate change,” said Rich Gilmore, chief executive officer of CGP.

The fund requires a minimum investment of US$500,000, and has a targeted return of 20 per cent per annum after fees. CGP said target returns will be generated through long-term capital appreciation and through value investing in mispriced assets.

Capital will be allocated primarily across three categories of verified carbon credits: nature-based solutions (activities that protect, sustainably manage and restore ecosystems), renewable energy (activities which replace fossil fuels with clean energy sources), and household devices (activities that reduce energy demand at the household level).

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Kelvin Chiu, principal of Silverstrand Capital, a family office investing in regenerative agriculture and nature-based solutions, said, “The focus of our impact investment strategy is to address the biodiversity crisis. The carbon markets are an effective way to channel additional financial resources to important nature conservation projects that benefit local communities.

“The long-term supply deficit in carbon credits also makes it a financially compelling investment. Rich (Gilmore) and his team have deep expertise and experience in the carbon space, and we are proud to anchor their second fund.”

CGP’s first fund, the Carbon Growth Opportunities Fund, is said to have returned 72 per cent net since its inception in July 2021, and financed more than 25 million tonnes of emissions reduction and removals. 

The investment company - which has over US$200 million under management - specialises in international carbon markets, with a large portion of its strategy focused on high-quality, nature-based carbon credits. “In 2021 alone, we were able to raise US$100 million in investment for emissions reduction projects, and our new Carbon Growth Fund will help us do more of the same,” Gilmore said.