Evaluate UN budgets and programmes as an AI Secretary-General

Seed Capital Assistance Facility

To reach the goals of the Paris Agreement and the 2030 Agenda for Sustainable Development rapid decarbonisation of global energy systems, the unlocking of private sector capital flows and the building up of climate finance and renewable energy development capacity worldwide is needed. The volume of capital needed to achieve these goals is approximately USD 2.4 trillion per annum through 2035 (IPCC 2018, Global Warming of 1.5°C). One of the primary challenges slowing the deployment of renewable energy assets in developing countries is the “early stage financing gap.” While the costs of early stage development are comparatively low, the risks and barriers for investors and developers are extremely high, dynamic and constantly changing—especially in frontier markets. The Seed Capital Assistance Facility (SCAF) is a public sector donor‑funded Project Preparation Facility (PPF) designed to address this challenge by supporting private sector investment entity managers and development companies working in high‑risk frontier markets in Africa and Asia. Through three support lines (SLs) the facility offers pure and repayable enterprise and seed capital grants to help its partners bridge the early stage financing gap, develop bankable pipelines, crowd‑in private sector capital and accelerate the deployment of renewable energy projects and clean technologies at scale. While other facilities and institutions target individual project‑level support, SCAF is unique in that it focuses on supporting its partners on a broader level. SCAF is the only publicly funded facility using grants as its only financial support instrument to both fund managers and development companies. Additionally, one essential advantage of SCAF is the alignment of interests it creates between the public finance mechanism and private partners in selecting and supporting projects. With the experience gained through the years, the scaled up SCAF programme will continue to both broaden the governance approach and narrow the executing function working together with Frankfurt School UNEP collaborating center. SCAF focuses on building the capacity of the investment entity managers and development companies that deliver pipelines of bankable assets as well as individual projects. As a result, it plays an important role in the mobilisation of private sector capital and the provision of pipelines of investment opportunities that crowd‑in later‑stage facilities, investors and commercial institutions. Furthermore SCAF contributes to the development of local and regional ecosystems of expertise with the potential to deploy energy and climate solutions at scale.