By Simon Jessop LONDON, March 18 (Reuters) - A new initiative aims to help finance renewable energy across the world by asking companies to donate 0.1% of their revenue, in turn drawing in billions of
Companies Worldwide Pledge 0.1% of Revenue to Fund Renewable Energy Projects
By Simon Jessop
Global Initiative to Finance Renewable Energy
LONDON, March 18 (Reuters) - A new initiative aims to help finance renewable energy across the world by asking companies to donate 0.1% of their revenue, in turn drawing in billions of dollars from other investors, its founder told Reuters.
Launch and Goals of Point One
Point One, launched on Wednesday with an initial 30 businesses, aims to raise at least $200 million by 2030 and use that to attract as much as $3 billion from institutional investors.
Focus on Small and Medium-Sized Firms
Led by Ryan Kohn, co-founder of food brand Proper Snacks, the first backers are small- and medium-sized firms, which collectively make up more than 90% of companies and 50% of the global economy, the IFC has said.
Accessible Contribution Model
By setting the revenue contribution at a low level, the initiative hopes more companies will sign on: "It's a simple message to be able to tell and our line is 'Almost Nothing Changes Everything'," Kohn said.
Dan Stern of Piper Private Equity, a backer of the initiative, said it offered a "practical way to make a meaningful difference" and that the firm was encouraging partner brands to join.
Potential Impact and Global Context
A 0.1% slice of global business revenue - around $171 trillion in 2025 - could fund a full transition of the world's power supply to clean energy by 2040, analysis by think tank Global Nation showed.
Importance of New Funding Sources
With richer countries scaling back development aid, securing new funding through taxes, levies or philanthropy has taken on greater importance at global climate talks.
Scaling Donations and Attracting Investment
To scale donations, Point One is initially working with the Global Energy Alliance for People and Planet (GEAPP), which works with philanthropies and others to make investments more attractive to private capital.
Innovative Financing Approaches
One option is for the companies' contributions to take the first loss on a project, a step that can draw in around 15 times as much in additional money.
"There's an increasing urgency to look for new sources of money," GEAPP Chief Executive Woochong Um told Reuters, adding companies were a relatively untapped area.
Encouraging Broader Participation
"That's why Point One comes in at a perfect time to help facilitate the vast number of companies who haven't actually had a chance to contribute in this big global movement."
(Reporting by Simon Jessop. Editing by Mark Potter)
