Sustainability & Green Transformation
In the course of 2022, 30% of EIF financial support was targeted at the field of sustainability and the green transformation. At the same time, and in line with the EIB Group Climate Bank Roadmap ambition, 21% - around €2bn - was channelled in pursuit of the horizontal objectives of climate action and environmental sustainability. This is a reflection of our resolve to boost our support for a greener and cleaner environment.
The developments around us have only underlined the urgency of supporting the game-changers that are working on innovative solutions, helping us tackle climate change effectively and transition to a greener, more sustainable world, but also the ones investing in existing clean technologies, resource and energy efficiency. We have backed a multitude of specialised fund managers in sectors like agritech, the blue economy, circularity and sustainable mobility as we pursue our climate and environment objectives and the goals of the European Green Deal.
In parallel, we’ve been working also on helping traditional businesses and individuals to finance their climate investments and move to a more environmentally sustainable footing, and we have seen our work on infrastructure funds really take off, giving this relatively new business line a prominent position in our greening efforts.
Responding to the energy crisis
The war in Ukraine has catapulted energy security to the front of the agenda, adding a very compelling argument to the need for alternative energy sources and savings. Using a multitude of different instruments, we have continued to support small business active in areas like energy efficiency, storage, renewables and decarbonisation, ultimately fuelling the green transformation.
€30m were invested in the Klima Energy Transition Fund, a growth stage pan-European fund focused on innovations supporting the energy transition, primarily in Spain. It will target the development and deployment of energy efficiency, renewable energy and low carbon technologies. The EIF is an anchor investor for this first-time investment team composed of two partners with a relevant and successful investment track record gained mainly in Spain and Germany.
In Belgium, we backed Belgian VC investor Junction Growth Investors, committing €30m from the InvestEU programme and the Dutch Future Fund in the firm’s first growth-equity fund, Junction Growth. The fund will be scaling and industrialising impact-driven companies developing software and hardware solutions that enable the energy transition, facilitating the shift towards more sustainable energy consumption and carbon-neutrality for many SMEs in the region.
Using InvestEU resources, we made a cornerstone investment in F2E Fund (Fonds de Financement de l’Efficacité Énergétique), a French diversified debt fund launched by Sienna Private Capital. F2E, with Greenfin label, will provide bespoke financing to SMEs focusing on the energy efficiency sector, such as energy performance, self-consumption, storage and low-carbon mobility, including green hydrogen production projects. Furthermore, the fund will support emerging market trends in climate change mitigation, such as the production of green hydrogen and decentralised energy storage through batteries. F2E is an impact fund pursuing an explicit sustainable investment strategy reflected by its Article 9 SFDR classification. The Manager anticipates that the fund will facilitate the avoidance of 665kT of CO2-equivalent over its lifetime. The EIF’s commitment amounts to €30m.
We invested €25m in Contrarian Ventures Net Zero 2022. The Fund, based in Lithuania, will invest in impact driven companies developing sustainable energy technologies, smart mobility and building solutions that enable the green transition. With this commitment the EIF not only seeks to make more venture capital financing available to the energy tech sector, but also contributes to the establishment of a specialised EU VC ecosystem capable of providing expertise in addition to capital, and supporting energy ventures from early to late stage financing and across the European continent.
The EIF also invested €100m in Pearl Infrastructure Capital II, a Luxembourg-based fund that will pursue a specialist strategy of investing in assets mainly dedicated to decentralised baseload renewable energy production and circular economy. As such, this represents EIF’s first investment in a fund that has a core focus on construction and expansion of decentralised baseload renewable energy assets. This sector has gained an increased prominence for energy resilience in the current geopolitical context marked by the invasion in Ukraine.
In December we closed our first ever synthetic securitisation transaction of a portfolio of residential mortgages with Banco Santander, Spain’s largest banking group. The transaction will facilitate the origination of around €143m of new green mortgages in Spain and will provide Santander with additional capacity to develop innovative green lending activities, support their customers’ green transition, and contribute to net zero by 2050. In addition, under the transaction, we will provide protection on the upper mezzanine tranche, while reinsurers will be providing protection on the lower mezzanine tranche making it also the first time that we participate in an unfunded securitisation with other private investors, especially reinsurers.
Rising energy costs & potential energy shortages have become the most survival-threatening problems for PE MM fund managers’ portfolio companies.
EIF Private Equity Mid-Market Survey 2022
REPowerEU
At the same time, the European Commission presented in May the REPowerEU Plan, its response to the hardships and global energy market disruption caused by Russia’s invasion of Ukraine. The plan describes the double urgency to transform Europe’s energy system: ending the EU’s dependence on Russian fossil fuels, which are used as an economic and political weapon and cost European taxpayers nearly €100bn per year, and tackling the climate crisis.
The REPowerEU Plan estimates that the total investments needed to reduce the dependence on Russian fossil fuels to zero by 2030 would amount to €300bn, of which €210bn before the end of 2027. Under REPowerEU, the EIF will finance €3bn between 2023 and 2027 for additional intermediated equity investments in support of sustainable energy, energy efficiency, energy transition, and green innovation. This is expected to mobilise €45bn of additional investments to accelerate the green transition and reduce EU fossil fuel dependence.
"Players of Change" tackling climate change
EcoG: integrated charging
Location
Munich, Germany
Financial Intermediary
Ananda Impact Ventures
SME
EcoG
Sector
e-mobility
Number of employees
28
Financing purpose
growth
EIF financing
SIA, Corona Matching Facility

Climate & infrastructure funds
Green infrastructure projects are a catalyst for sustainable growth and development, promoting the transition towards a greener economy. From transport systems to power generation, soil decontamination or sustainable urban development. And from large offshore windfarms to the electric vehicle charging station in your neighbourhood. Infrastructure projects also tackle biodiversity and climate change adaptation, making a significant contribution to EIF’s horizontal policy objective of climate action and environmental sustainability. Indeed, in 2022, the EIF’s climate and infrastructure funds represented an investment of €625m with a 80% climate action and environmental sustainability content. A significant ramp up to €1bn is foreseen in 2023.
In 2022, we made a cornerstone investment of €75m in Eurazeo Transition Infrastructure Fund, a market player committed to climate change mitigation and decarbonisation. The Fund invests in transition infrastructure, including the energy transition, the digital transition, sustainable transport and circular economy.
We also committed €75m to the Eiffel Transition Infrastructure Fund, an innovative fund designed to provide equity bridge financing for renewable energy infrastructure assets in Europe. This equity bridge solution is particularly relevant for renewable energy developers and independent power producers with large pipelines of new projects in development but without the capital to finance them all in parallel. The transaction underlines the EIB Group’s unwavering support for the European Green Deal and the plan to make the EU independent from Russian fossil fuels ahead of 2030.
InvestEU Sustainability Guarantee
InvestEU has been conceived to flank and support broader EU policy objectives, with the European Green Deal figuring prominently among them. This means offering both equity investments into innovative businesses developing solutions that will help with environmental sustainability and tackling climate change but also a new guarantee product, the Sustainability Portfolio Guarantee, that enhances access to debt finance for SMEs, small mid-caps, natural persons and housing associations contributing to the green and sustainable transformation of the European economy.
This financing aims to support a transition to a climate-neutral European economy based on sustainable development, a reduction in dependence on fossil fuels, sustainable management of natural resources, food security and enhanced climate resilience, among other goals.
The instrument has been met with huge demand from the markets, far exceeding the available resources, underlining the appetite for these types of investments.
In Lithuania, the EIF and AB Mano Bankas entered into a €30m uncapped portfolio guarantee agreement focusing on two different policy goals: a €20m guarantee to support the sustainability and green economic transition, and an additional
€10m guarantee to support SMEs that were negatively affected by the COVID-19 pandemic. The transaction is expected to mobilise €60m investments in the real economy.
Using a €100m guarantee, Intesa Sanpaolo will be supporting the investments and liquidity needs of innovative SMEs and small mid-caps in Italy and help with their digital and environmental transition. In particular, half the portfolio guarantees will be dedicated to sustainability and the green economic transition. Intesa Sanpaolo and the EIF estimate that these instruments will make it possible to mobilise investments in the real economy totalling €200m for new growth projects in Italian industry, focused on sustainability objectives.
The EIF and Banco Sabadell, one of the largest banking groups in Spain and a pioneer in offering SMEs innovative solutions such as venture debt financing, joined forces once more in 2022. This latest guarantee agreement will enable the Spanish bank to mobilise financing of up to €336m for SMEs. The funding will support start-ups via venture debt operations; high growth potential industrial companies with senior and mezzanine loans; and decarbonisation sector companies (renewable energy projects and sustainability companies) in products such as senior bridge loans and subordinated loans. This is one of EIF’s first agreements in Spain under the InvestEU guarantee programme.
Where blue is actually green
The EIF has been very active in the blue economy space, supporting investors who are looking to make a difference in the field of economic activities related to oceans, seas and coasts, ranging from renewables to robotics, transport to tourism, biodiversity to biotechnology and everything in between. Our work was driven initially through a pilot scheme set up under EFSI, which will be continued under InvestEU, and more recently also through a bespoke programme jointly set up with the Portuguese government, called Portugal Blue.
Combining InvestEU resources with a joint investment from Portuguese NPI BPF, we invested €28m into Growth Blue Fund I, the only operator focusing on the lower mid-market blue economy in Iberia. The Fund, which has a target size of €50m, will invest predominantly in Portuguese SMEs across all sectors of the blue economy, in particular seafood, blue bio-economy and offshore energy, helping them with their growth strategies.
In parallel, and on the same topic of water, the EIF made its first investment into the water tech industry through its €30m commitment to PureTerra Ventures I, an early growth venture capital fund based out of the Netherlands and focusing on impact-driven companies developing disruptive technologies aimed at improving water usage, treatment, recycling, collection and conservation. Global demand for water not only exceeds its availability, but existing water resources are increasingly contaminated or wasted. According to research conducted at MIT, water stress is expected to affect 52% of the world’s population by 2050.
Agriculture & agritech
The link between healthy people, healthy societies and a healthy planet has put sustainable food systems at the heart of the European Green Deal. We have been working closely with partners across Europe to finance the development of agritech solutions and also support farmers and SMEs in the agriculture sector.
In particular, we invested €39m in Zintinus Fund I, a venture capital fund focused on growth stage investments in sustainable food innovation across Europe, in particular alternative proteins, functional food, clean nutrition and food waste reduction.
In Germany, we contributed €25m in Green Generation Fund. Founded by two experienced female entrepreneurs, the fund targets innovators in the green, and food tech sectors. It aims to invest in companies that contribute to CO2 reduction and are active in areas including plant protein extraction and innovations in fermentation and cell cultivation as well as the reduction of shelf-life substances in the food industry, sustainable packaging, carbon capture solutions and green tech software.
In Ireland, following the successful implementation of the Future Growth Loan Scheme (FGLS, a counter-guarantee to the Irish NPI, SBCI) the Irish government decided to replicate this initiative by providing approximately €100m to the EIF for an uncapped counter-guarantee. This is a joint initiative with the EIB that will provide mezzanine and part of the senior coverage for the uncapped counter-guarantee. The final loan portfolio will support investments related to climate (30%) and the agricultural sector (40%).
Accelerating the green transformation
The green transformation encompasses a broad range of other sectors, including sectors that are only barely emerging. In part, that’s what the venture capital teams that we support are out to identify and foster. Many of the funds (including private equity funds) that we have supported are already making careful commitments to businesses that are turning ground-breaking research into future solutions as we transition to a cleaner, greener economy.
We supported the climate tech sector, one of the fastest-growing areas of European tech, by committing €50m into German climate tech VC fund World Fund. The fund which was ranked first in Europe for ESG by alternative assets data and insights provider Preqin earlier in 2022, invests in start-ups that have the potential to save at least 100m tonnes of CO2 equivalent per year and tackle one of the most pressing issue of our time. This is one of the largest investments the EIF has made into a first-time VC fund.
€40m were invested into Algebris Green Transition Fund, a private equity fund aiming at raising €300m that will be invested mainly in Italian companies focusing on the main sectors of green transition.
The Fund will invest, directly or indirectly, exclusively in companies that will contribute to one or more of the following UN Sustainable Development Goals: Clean Water and Sanitation, (ii) Affordable and Clean Energy, (iii) Industry, Innovation and Infrastructure, (iv) Sustainable Cities and Communities, Responsible Consumption and Production, and Climate Action.
The EIF also backed new fund initiatives and VC fund managers in the sustainable mobility field. One of them, Rethink Mobility, based in Munich, in which the EIF invested up to €20m, focuses on early-stage companies that contribute to the clean and digital future of mobility, including new technologies, products and services for vehicles, mobility, logistics and energy. The transport of people and goods has a global carbon impact of 8bn tonnes each year highlighting the importance of this sector as regards the green transition and European Green Deal.
Finally, 2022 marked the launch of the European GreenTech fund-of-funds, with a target size of €250m. Set up under the EIF’s Sustainable Development Umbrella Fund (SDUF), its aim is to leverage private resources in support of companies offering entrepreneurial solutions to climate and environmental issues, in combination with delivering financial returns. The European Greentech fund-of-funds intends to invest in 10-15 VC funds and has already attracted investor interest from several parties.
Calyxia: biodegradable micro-capsules
Location
Paris, France
Financial Intermediary
Astanor Ventures
SME
Calyxia
Sector
microplastics; sustainability
Number of employees
80+
Financing purpose
scaling up, commercialisation
EIF financing
EFSI sub-window 1, Blue Economy pilot

Share this page on social media: