International finance programs working to strengthen energy efficiency alongside the transition to clean cooling are now able to apply for additional funding support from the Kigali Cooling Efficiency Program (K-CEP). The philanthropic initiative has opened applications for its third window of support, which will provide grants for technical assistance or other costs related to raising capital finance for existing programs.
K-CEP is making available up to USD 10 million under its finance window and is seeking initial applications for funding from USD 2 million to USD 5 million to support efficient clean cooling finance programs. These programs will need to bring existing capital funding from development banks, climate funds, governments, private sector banks, or other financial institutions to be used alongside this K-CEP support.
The finance window is designed to accelerate investment into efficient clean cooling, referring to air conditioning and refrigeration equipment that uses less energy and refrigerant gases (F-gases) with a lower global warming potential (GWP).
Providing efficient, clean cooling is a looming climate challenge facing a warming world. Cooling already accounts for more than 7% of global emissions and is set to grow as developing country economies expand. A simultaneous phase down of hydrofluorocarbons with the introduction of more efficient cooling could help avoid the equivalent of approximately 160 billion tonnes of CO2 by 2050.
Phasing down these super-polluting F-gases is an internationally agreed legal requirement under the Kigali Amendment to the Montreal Protocol. The focus on energy efficiency will also reduce operating costs and carbon emissions from energy use while helping to unlock health, prosperity, and environmental benefits.
Successful applicants will be able to use the funding for technical assistance or to cover structuring and other incremental costs associated with raising capital finance to support activities that demonstrate additional efficiency benefits compared to a business-as-usual scenario. This finance window complements K-CEP’s three other existing windows which support: capacity building (Strengthening for Efficiency); policy (Cooling Efficiency Policies, Standards, and Programs); and access (Access to Cooling).
Mijo Vodopic, Senior Program Officer at the John D. and Catherine T. MacArthur Foundation, one of K-CEP’s founding partners, said:
“Efficient, clean cooling globally means better health outcomes, less wasted food, and more productive economies. That is why K-CEP is offering funds to cover necessary technical work, to help mitigate risks and cover additional management costs that can help unlock the huge amounts capital needed to accelerate the development and deployment of efficient, clean cooling.”
Shilpa Patel, Head of K-CEP’s Finance Window, said:
“Finance can be an essential lifeline to programs designed to support efficient clean cooling. We’re excited about the range of programs this Finance Window could support by providing technical assistance for activities such as creating bankable propositions, raising awareness and providing technical advice and covering the incremental costs of raising capital finance such as the fees associated with guarantee facilities or interest rate subsidies on loans to end customers.”
Tom Delay, Chief Executive of the Carbon Trust, which is supporting K-CEP to manage this finance window, said:
“We urgently need to catalyze new ways to deploy efficient, clean cooling solutions. Funding to support technical assistance and implementation is key to unlocking the full potential of clean cooling finance programs. We’re delighted to be supporting K-CEP on delivering this important work.”
K-CEP will make funding decisions in two steps: initially seeking initial applications before requesting refined proposals from selected organizations.
The finance window is open to all types of organization including development banks, multi-lateral organizations, climate finance institutions, private sector banks and companies, and non-governmental organizations.
Funding can be provided for technical assistance (for example, creating bankable propositions, raising awareness, and providing technical advice) and covering the incremental costs of capital finance (for example, the costs of putting a guarantee in place).
This window is explicitly not designed to be the source of capital funding for a financial instrument and instead aims to play a catalytic role in unlocking this capital.
About the Kigali Cooling Efficiency Program
K-CEP is a philanthropic collaboration launched in 2017 to support the Kigali Amendment to the Montreal Protocol and the transition to efficient clean cooling. K-CEP’s secretariat, the Efficiency Cooling Office, is located at the ClimateWorks Foundation. The Finance Window is one of four windows operating under K-CEP, the others are: Strengthening for Efficiency; Cooling Efficiency Policies, Standards, and Programs; and Access to Cooling.
About the Carbon Trust
The Carbon Trust is assisting K-CEP in the development of its Finance Window. The Carbon Trust is an independent, expert partner of leading organisations around the world, helping them contribute to and benefit from a more sustainable future through carbon reduction, resource efficiency strategies and commercialising low carbon technologies.