The Asia Investor Group on Climate Change ( AIGCC ), which has 80-plus investor members that collectively manage US$36 trillion in assets under management, has signed onto the Climate Finance Principles for Grid Investment, facilitated by the Green Grids Initiative and supported by the Utilities for Net Zero Alliance to accelerate the development of grid infrastructure. 

These principles place considerable emphasis on having in place transparent and robust plans and monitoring systems on which investors can base their assessments. They are applied within the wider context of the project financing and national planning.

The principles cover:

• Sector climate contribution – Power sector targets must include a sufficiently ambitious net positive contribution to climate targets.
• Planning consistency – Power sector plans must be internally coordinated.
• Sector measurability and attribution – Power sector contribution must be measurable, time-bound and reported.
• Project climate contribution – Progress of indicators in the project should show a sufficiently ambitious net positive contribution to climate targets.
• Project consistency – Project must be consistent with power sector plans.
• Project measurability and attribution – Project net positive contribution to sector planning targets should be measurable, time-bound and reported.

“Asia’s grid infrastructure requires unprecedented capital deployment to support the region’s energy transition, meet energy security needs and ensure grid availability,” says Rebecca Mikula-Wright, the AIGCC’s CEO. “Electricity companies in Asia stand to lose up to US$6.3 billion in annual costs from climate hazards if not managed properly. To manage physical risk exposure, investors, as stewards of capital, are motivated to engage companies on their adaptation and governance strategies.

“To complement the investor approach, the Climate Finance Principles for Grid Investment provide investors with the measurable, transparent standards essential for deploying capital confidently, while ensuring grid investments deliver genuine decarbonisation outcomes.”