Catalytic capital is key to emerging markets badly in need of decarbonisation funding
Managers are courting catalytic capital – investment willing to accept a lower return – so as to bring more investors to the table
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BILLIONS of dollars are being raised to build solar plants and wind farms, but capital is flowing to where returns are highest – not where needs are greatest.
Catalytic capital is crucial to stemming this flow, and some market players say investors with lofty goals may be better off taking a commercial stance over a developmental one.
“A lot of people are investing in decarbonisation, but focused less on emerging markets because a lot of the time they carry more risk,” said Luke Edwards, managing director at Brookfield Asset Management’s renewable power and transition group.
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