Climate Fund Managers (CFM), a Netherlands-based blended finance fund manager co-owned by Dutch development bank FMO, has successfully secured €150 million in commitments from European investors for its new global energy transition and green hydrogen infrastructure fund. The fund is designed to drive investment into the rapidly evolving green hydrogen sector and support the transition to cleaner energy sources.
Green hydrogen, produced via water electrolysis using renewable energy sources like wind and solar, is considered a crucial element for decarbonizing industries that are difficult to electrify. However, the production cost of renewable hydrogen is currently two to three times higher than fossil fuel-based hydrogen, according to the International Renewable Energy Agency.
The Climate Investor Three fund will initially focus on projects in Namibia and South Africa, leveraging the countries’ rich renewable energy resources and favorable production conditions. The fund will be structured as a family of funds targeting the green hydrogen value chain and broader energy transition investments.
Sebastiaan Surie, head of hydrogen at CFM, explained that the fund’s blended finance model allows it to invest across the entire lifecycle of projects—ranging from development to construction and operations. By providing catalytic capital at early stages, CFM helps de-risk projects, attracting private sector investment for the construction phase. “This blended finance approach significantly increases the chances of success for these projects, which is essential for building the critical infrastructure needed to drive the energy transition,” Surie said.
The blended finance model enables donor capital to absorb early-stage risk, making the projects more attractive to commercial capital. This approach unlocks significant private funding, which would otherwise be difficult to secure without the added de-risking factor. Without such mechanisms, many essential projects might never reach fruition.
A 2023 report by Deloitte highlighted the massive financial need for the global green hydrogen supply chain, estimating that over $9 trillion (€8.7 trillion) will be required to meet net-zero targets by 2050, including $3.1 trillion in developing economies alone.
CFM, a joint venture between FMO and South Africa’s Sanlam InfraWorks, targets infrastructure and climate-related investments in emerging markets. Founded a decade ago, CFM has mobilized over $2 billion in assets, utilizing blended finance strategies to balance risk and attract private capital for climate-resilient projects in developing countries.
The Climate Investor Three fund plans to invest in green hydrogen and energy transition projects with budgets ranging from $25 million to $100 million. This includes decarbonization efforts across industries, critical minerals, storage and grid infrastructure, and enabling technologies essential for the energy transition.
The fund will act as a feeder fund, investing directly into projects or into country-specific funds, such as SDG Namibia One and SA-H2. SDG Namibia One is an energy transition and green hydrogen fund in collaboration with the Environmental Investment Fund of Namibia and Invest International, while SA-H2 focuses on South Africa’s energy transition, supported by Invest International, Sanlam, the Development Bank of Southern Africa, and the Industrial Development Corporation of South Africa.
Hans Docter, co-CEO of Invest International, emphasized the immense potential of green hydrogen to drive sustainable development in emerging markets. “Unlocking this potential requires close cooperation between the public and private sectors,” he said. Benedict Libanda, CEO of the Environmental Investment Fund of Namibia, agreed, noting that global partnerships are vital to overcome the challenges of scaling green hydrogen production and export, especially in the nascent stage of the sector.
Surie concluded, “As green technologies become increasingly competitive and cost-effective, the energy transition will continue to progress, irrespective of political developments, making green hydrogen a critical component in the shift away from fossil fuels.”
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