One of the more innovative uses of the Facility has been to link conventional financing organisations to evolving markets for carbon trading. The Jamaican wind project is a good example of linking sustainable energy financiers to carbon-traders (see box previous page). As a result of this work, and the evolving markets for carbon abatement, the company involved in the Jamaican project, RES, is now looking at projects in other developing countries that may also offer a carbon value.
The IAF is supporting the creation of new investment funds, including a carbon fund under development by a major European banking group and an ESCO fund under development by IDB and FondElec. For each fund, UNEP is providing assistance to help create and evaluate a stream of potential sustainable energy investments.
With another client, the IAF is supporting the preparation of a carbon investment fund. UNEP promotes such activities not only as a means of shifting finance flows towards environmentally-sound, sustainable energy choices, but also to send the signal that many RET and EE technologies are ready for deployment, as well as the carbon values (e.g., $/ton) needed to make some newer technologies commercially competitive.