BII launches British Climate Partners to accelerate energy transition in Asian developing economies

BII launches British Climate Partners to accelerate energy transition in Asian developing economies

British International Investment, the UK’s development finance institution and impact investor, on April 24 announced its new five-year strategy, including the launch of British Climate Partners to accelerate energy transition across Asian developing economies.

BCP is a new £1.1 billion ($1.48 billion) initiative designed to mobilise private capital at scale to support the energy transition in Asian developing economies and accelerate progress towards net-zero.

Asian countries accounted for around three quarters of global coal demand in 2024, placing the region at the centre of the global energy transition challenge. Furthermore, the scale of investment required to transition away from coal remains significant, with Southeast Asia needing an estimated $210 billion annually and India at least $160 billion a year until 2030.

Photo: BII

As a leading climate finance investor, BII is increasing its commitment to support Asia’s energy transition by mobilising private capital alongside its own. Through BCP, BII will work in partnership with private investors to deploy capital through a combination of equity platforms and mezzanine finance to scale climate projects, reduce early‑stage risks and offer potential higher returns to attract commercial investors.

The initiative will focus on investments that support emissions reduction in fast-growing countries with coal-based energy networks and rising demand for clean energy including India, the Philippines, Indonesia, Vietnam, Thailand, Malaysia and other South-East Asian economies.

BII will continue to provide climate finance to its other markets. In the next five years, BII expects that at least 40 per cent of new investments, including BCP, will qualify as climate finance – up from the target of 30 per cent in the last strategy period.

Photo: BII

UK Minister for Development Jenny Chapman said, “Over the past few months, I have been setting out the need for a new UK approach to development – one moving from traditional aid grants to long-term partnerships that bring investment, expertise and international finance reform together. It also means investing responsibly: bringing everything the UK can offer – from our work through international organisations and our investment tools, to research, practical advice and diplomacy. Used together, this can help businesses grow, create jobs and support the reforms and policies our partners choose for themselves.”

“BII sits right at the heart of this approach, and its new strategy is pulling in the same direction we have set as a government. I know BII will lead from the front in turning our joint ambitions into genuine results over the next five years,” he said.

Srini Nagarajan, managing director and head of Asia, BII said, “Asia’s energy transition will depend on mobilising private capital at scale and British Climate Partners is designed to do exactly that. Through this new initiative, we’ll use our experience, capital and partnerships to build platforms, de‑risk projects and crowd in long‑term investment into commercially viable climate opportunities across the region.”

BII will sustain the UK’s long‑standing commitment to frontier markets in Asia, including Nepal. Over the next five years, at least 25 per cent of BII’s new investments will be committed to Least Developed Countries as defined by the United Nations, where private capital remains scarce, and development needs are greatest.

In an evolution of its approach, BII will also seek to make “market-level impact” investments that go beyond a commitment to a single company, and help to develop a wider sector or market.

BII will also increase its commitment to gender-lens investing in support of women, with the intention that 30 per cent of its new investments (not including BCP investments) will qualify under the 2X Challenge.

VIR