By Dirk Elsen, Director of Emerging Markets at Triodos Investment Management
The exciting developments in the transition from fossil fuel to renewable energy have led to resounding enthusiasm in the industry to increase investment in emerging markets and provide alternative sources of clean energy; ultimately giving access to populations that previously were without.
Access to finance and energy is an important prerequisite for further social and economic development. At Triodos Investment Management, our emerging markets team is working closely with Triodos Groenfonds to expand the renewable portfolio and include diverse technologies, such as solar, wind, and hydro.
Investing in hydro, solar, and wind
Over the last year, we have worked with the energy and climate team to grow Triodos Investment Management’s renewable vision to more than three different projects in three different continents. A few months ago, we were proud to announce our investments in
Lake Turkana Wind Power in Kenya, Essel-Clean Solu Hydropower in Nepal, and IntelleGrow in India, in addition to showing the developments in renewable energy. Our strategy to invest in renewable energy as well as inclusive finance is a natural fit with what we already do, contributing directly with our goal of positively impacting the real economy.
Recently, Triodos Groenfonds announced the newest investment,
Compania Hondurena de Energia Solar (hereafter: Cohessa) and worked directly with our emerging markets team to further our objective of expanding through diverse technologies. Access to energy has broader implications for a region on a social and economic level. In Honduras, one of the poorest countries in Central America, the ground-mounted solar plant has a positive ramification for the energy sector and for the country’s dependency on fossil fuels. It also has the capability to provide thousands of households with clean energy and create jobs.
When we invest in renewable energy, we make sure that the production method – hydro, solar or wind – is well suited to the country or region, while at the same time we strive to diversify our renewable energy portfolio.
Our renewable energy strategy
Not only are we seeking to invest in projects, but we are also looking at the subsectors, such as off-grid projects. These local financiers provide loans for renewable technology using our financing; this business model is not dissimilar to how we currently operate in inclusive finance. Hivos-Triodos Fund, too, is looking into opportunities that would include financing SMEs that then fund renewable technologies or projects.
By expanding our SME strategy to include renewable energy, we are continuing to catalyse social and economic progress, whilst at the same time promoting renewable alternatives. We see trends emerging and demands from governments and investors, and we are responding by continuing to develop our strategy by looking into future growth opportunities in this arena.