Toronto-based Brookfield Asset Management has secured up to $4 billion (all figures Canadian) in commitments from a new United Arab Emirates investor for two of its global energy transition and climate funds. Together, the Brookfield funds plan to deploy over $27 billion to climate and decarbonization initiatives.
The announcement was made earlier today (Dec. 1) at COP28 in the UAE.
For its part, Brookfield (BAM-T) unveiled a new multi-billion-dollar Catalytic Transition Fund, which will receive a portion of the funding. The rest will be allocated to the Brookfield Global Transition Fund II.
The newly launched UAE fund, known as ALTÉRRA, is a private investment vehicle created with a $40.5 billion commitment from the Gulf State. It is designed to “mobilize” almost $340 billion for the new climate economy by 2030, according to Majid Al Suwaidi, the director general of COP28 and incoming CEO of ALTÉRRA.
Brookfield’s Catalytic Transition Fund will focus on providing capital for emerging and developing markets in Asia, Eastern Europe, Latin America and the Middle East.
ALTÉRRA Transformation will contribute up to $1.35 billion to the Catalytic Transition Fund, while ALTÉRRA Acceleration committed to investing $2.7 billion for the second Brookfield Global Transition Fund.
“The Catalytic Transition Fund is an innovative private sector solution to this imperative which combines institutional capital and Brookfield’s decades of experience in renewable power and transition investing,” Mark Carney, the chair and head of transition investing at Brookfield Asset Management, said in the release.
About the Catalytic Transition Fund, Brookfield Global Transition Fund II
The Catalytic Transition Fund will concentrate investments on the energy transition, industrial decarbonization, sustainable living and climate technologies, according to a release.
Brookfield, one of the world's largest asset managers, will contribute at least 10 per cent of the Catalytic Transition Fund’s capital.
Quebec pension fund Caisse de dépôt et placement du Québec also expressed interest in contributing capital, the release said.
The second Brookfield Global Transition Fund follows up on the first, which raised US$15 billion in June 2022. It supported projects such as the acquisition of U.S. and German solar power and battery developers with a combined renewable power development pipeline capacity of approximately 25,000 megawatts.
Brookfield has invested into the clean energy transition as part of its 2050 net-zero target. It holds 25 gigawatts of installed renewable generating capacity, which it hopes to double by 2030.
It has set out to power its 70-million-square-foot U.S. office portfolio with only zero-emissions electricity by 2026.