Renewable Energy Scale-Up Facility ANNEXES

This document provides the technical annexes for the Renewable Energy Scale-Up Facility (RESF), detailing the financial modeling, assumptions, and expected impacts of a proposed USD 100 million equity fund designed to scale up wind and solar projects in developing regions, particularly Latin America.

• The RESF proposes a USD 100 million equity fund with a 12-year expected duration and an 8-year investment period. The fund structure includes a USD 99 million investment from limited partners (LPs) and USD 1 million from the general partner (GP), featuring an 8% hurdle rate and an 80-20 split on secondary payments between LPs and GP.
• The fund utilizes an options mechanism to attract investors earlier in the development process. RESF covers 20% of costs during the development stage (phase 1), and if exercised, these options allow access to a 40% equity share of projects at a discounted price to ensure a 16% gross IRR, which is higher than the prevailing market rate of 13%.
• Modeling for the first fund targets a portfolio of 12 solar and 12 wind projects. Solar projects are modeled with a 30 MW capacity and a total investment of $30 million, while wind projects are modeled with a 50 MW capacity and a total investment of $83 million. The model assumes failure rates of 33% and 25% for the two pre-development milestones respectively.
• The option structure is expected to provide higher returns than investing directly at financial closure. The expected net equity IRR for the option instrument is 17.5% at the fund level and 15% at the investor level after fees, compared to 14% at the fund level and 12.75% at the investor level for those investing at financial closure.
• Public finance is envisioned in two roles: as a provider of equity capital (proposed at 20% or USD 20 million) to increase return certainty, or as a purchaser of options via a convertible grant. The convertible grant is estimated to require between USD 4.7 and 7 million, or USD 0.3-2.7 million net of reimbursements.
• The pilot phase expects to invest USD 24.5-26.5 million in public finance to mobilize USD 80 million in private sector commitments, achieving a 1:2.7 public-private leverage. At the project level, this is expected to mobilize USD 50-138 million in additional equity and USD 250-640 million in loans, resulting in a final leverage of 1:15 to 1:30.
• RESF aims to develop 230-620 MW (central estimate 370 MW) of onshore wind and solar PV projects across six pilot countries. This is estimated to generate 16.5-44.5 million MWh (central estimate 30 million MWh) over 25 years, abating 265-725 ktCO2 annually (central estimate 500,000 tCO2).

APA

Climate Policy Initiative (2017). Renewable Energy Scale-Up Facility ANNEXES. https://www.climatepolicyinitiative.org/wp-content/uploads/2020/07/Renewable-Energy-Scale-Up-Facility-RESF_Annex.pdf

Chicago

Climate Policy Initiative. Renewable Energy Scale-Up Facility ANNEXES. 2017. https://www.climatepolicyinitiative.org/wp-content/uploads/2020/07/Renewable-Energy-Scale-Up-Facility-RESF_Annex.pdf.

Wikipedia

{{cite report |author=Climate Policy Initiative |title=Renewable Energy Scale-Up Facility ANNEXES |date=August 2017 |url=https://www.climatepolicyinitiative.org/wp-content/uploads/2020/07/Renewable-Energy-Scale-Up-Facility-RESF_Annex.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatepolicyinitiative2017renewable, author = {{Climate Policy Initiative}}, title = {{Renewable Energy Scale-Up Facility ANNEXES}}, institution = {Climate Policy Initiative}, year = {2017}, month = aug, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2020/07/Renewable-Energy-Scale-Up-Facility-RESF_Annex.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }