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Financial Innovation Lab
FINANCIAL INNOVATION LAB

Initiative

FINANCIAL INNOVATION LAB
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Leveraged co-financing from public and private sources has emerged as a policy priority among international environment and development agencies.

The Financial Innovation LAB is a place to exchange ideas about financing techniques for climate change mitigation and adaptation investments.

Our main objective is to create investment vehicles and financial structures that maximize private sector leverage and optimize the use of donor’s funds, such as the (Clean Technology Fund, Global Environmental Facility, Green Climate Fund and more).

Why climate change investments are perceived as being riskier? Most important reasons: high up-front costs, new technologies, uncertain market demand, long term-horizon of investments, policy bias favoring incumbents.

Our key premise is that public money should not be used for direct investing, but for de-risking. That is, donor’s resources should be carefully applied to absorb certain risks that constrain private sector involvement in green financing.

For this purpose, we combine a variety of financial tools, such as guarantees, blended loans, first loss structures, insurance vehicles, etc.

Juan A. Ketterer

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Financial
  • Guarantees and insurance products
    • (Partial) Credit Guarantee
    • Performance Guarantee and insurance
    • Project Completion
    • Political Risk
    • Policy and Regulatory Risk
  • Debt Subordination
  • Loan Loss Reserves (first loss)
  • Currency Risk
  • Cornerstone/Subordinated Equity
  • Public Investment Funds
A group of men in safety gear standing in front of solar panels
Non Financial
  • Contractual Provisions
  • Regulatory Provisions
  • Technology Norms and Standards
  • Third party validation and Verification
  • Access to Information, Knowledge-Sharing
  • Advance Market Commitment
  • Institutional Development and Capacity-building
A red and black small electric bus Shifting Investments from Diesel to Electric Urban Buses
A greenhouse with plants growing in it Climate Risk Financing in Agriculture
Large pipes in a factory Geothermal
A large array of solar panels Energy Savings Insurance
A man wearing safety gear working on a electrical box Scaling Up Private Investments in Concessions and PPPS for Renewable Energy Mini
a person wearing a hard hat Promoting Private Investment in Street Lighting
a woman and a child hugging in front of a white building ECOCASA
A person in safety gear with wind turbines in background Contingent Lines for Renewable Energy
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