Advancing climate funding & job creation in Africa

The world of renewable energy is evolving rapidly, presenting both challenges and opportunities for financing and investment in the sector. In a recent interview on CNBC Africa, Felicity Spors, the senior director of sustainable finance and innovation at Gold Standard, and Roy Masamba, the director and co-founder of Terragreen, discussed the key pillars enabling investors to realize the value of sustainable investments. Spors highlighted the emergence of impact investors who have a strategic intent to make a positive contribution, driven by regulatory requirements and rising consumer concerns about the environment. She emphasized the growth potential of impact investment, projected to reach $955 billion in the next three years, according to BNP Paribas. Gold Standard plays a crucial role in providing credible impact outcomes by working with project developers to measure and showcase the social, environmental, and governance impacts of their projects. By focusing on best practice impacts such as job creation, biodiversity conservation, and climate mitigation, Gold Standard helps attract external impact investors to sustainable projects. On the other hand, Masamba shared insights into Terragreen's business model, which prioritizes job creation, climate mitigation, and gender equality. He emphasized the importance of building a strong foundation for impact from the outset, integrating sustainability into every aspect of the business to attract impact investors. The conversation delved into the financial returns from impact investments, with Spors mentioning the lucrative carbon markets where projects like Terragreen receive value for CO2 mitigation and nature-based solutions. By integrating multiple impact outcomes such as job creation, climate action, biodiversity conservation, and gender equality, projects can unlock additional value in the market. Discussing the scalability of sustainable projects in South Africa, Spors pointed out land lease issues as a significant barrier that needs to be addressed. While the potential for growth is substantial, clear frameworks and effective land management are crucial for replication and scaling of successful models like Terragreen. Masamba emphasized the importance of attracting diverse investors, including high net-worth individuals, philanthropists, and corporates, to finance projects of scale. By demonstrating the integrated impact of their projects, which offer multiple revenue streams and social benefits, sustainable ventures like Terragreen can appeal to a wide range of investors. Overall, the interview highlighted the need for standardized impact measurement and narrative building to bridge the gap between project developers and impact investors. By showcasing successful models like Terragreen and providing support through equity funds and technical assistance, organizations like Gold Standard are paving the way for sustainable investments in Africa's renewable energy sector.