Through the SDGs, the international community of states aims to substantially advance global environmental, climate and resource protection. These issues are also of key importance for DEG and its customers. DEG has further increased the focus of its work with private-sector enterprises on avoiding GHG emissions since 2022. Its aim is to reduce GHG emissions in line with the Paris Agreement’s 1.5 ℃ goal in order to make DEG’s portfolio net-zero in 2040.
To this end, it will make no further high-emission investments without an agreed-upon transformation pathway compatible with the 1.5 ℃ Paris goal. Instead, it will invest more in climate-friendly business models, provide targeted advice to its customers – particularly those with high emissions – on their transformation pathways, and invest more in forestry and other carbon direct removal projects certified by internationally recognised standards.
More than ever, it requires the companies it finances to be managed as sustainably and efficiently as possible. Large parts of the global private sector rely on natural resources either as part of their core business or in their supply chains. Entrepreneurial commitment and innovative solutions for global environmental protection, climate action and resource efficiency are therefore critical to sustainable development.
All manufacturing companies and infrastructure projects in DEG’s portfolio commit to introducing international environmental and social standards. During due diligence, the current status is recorded and, where necessary, an action plan is drawn up. DEG expects banks and private equity funds to implement their own environmental and social management systems and to appropriately manage potential environmental and social risks for their customers. This enables risks to be mitigated and investment opportunities to be identified, and also enhances their reputations. By promoting compliance with international environmental and social standards and initiatives for more sustainable business activities, DEG is contributing to SDG 12 (Responsible consumption and production).
DEG also advises its customers across industries and regions on developing and implementing environmental and social management systems, on collecting emissions data and identifying reduction potential, and on developing their own climate action strategies to achieve zero emissions. It also helps them to obtain certification in line with international standards. DEG provided a total of EUR 680 million in 2023 for investments that promote climate and environmental protection.
The 130 energy utilities and power stations that are co-financed directly by DEG and indirectly via PE funds make their own contribution to SDG 7 (Affordable and clean energy) and SDG 13 (Climate action). They produce around 31.5 TWh of electricity from renewable energy sources each year, currently supplying over 32 million people. Solar, wind, hydroelectric and geothermal energy account for around 55% of electricity from renewable sources. This reduces emissions of carbon dioxide (CO2) by more than 22 million tonnes per year.
Name: Banco BAC San José, S.A.
Invested volume (in EUR) as of 31.12.2023: 108.6 million
Country: Costa Rica
DERa category: Environmental stewardship
Banco BAC San José is the second largest bank in terms of loan portfolio in Costa Rica and since the first agreement back in 2011 a customer and partner for DEG. In addition to BAC’s commitment to creating positive social, environmental and economic impact, the bank’s sustainability strategy “Triple Valor Positivo” includes the objective of measuring and reducing the climate footprint of its portfolio. BAC Group is committed to align with the Paris Agreement and signatory of the Net-Zero Banking Alliance (NZBA) and the Partnership for Carbon Accounting Financials (PCAF).
In 2023, the third successful transaction between Banco BAC San José and DEG took place. The loan will be used by BAC to on-lend to green and gender projects. The bank will support not just green projects like energy-efficient office buildings and electric vehicles among others in Costa Rica, but also initiatives focused on empowering women, aligned with the criteria of the 2X Challenge.
BAC will also receive support from DEG through its Business Support Services to enhance its Environmental and Social Management System. This enables the bank to manage the impact of its portfolio efficiently and to fully integrate international standards and to contribute to qualitative, sustainable growth.
Name: PT Surya Utama Nuansa
Invested volume (in EUR) as of 31.12.2023: 23.5 million
Country: Indonesia
DERa category: Environmental stewardship
Indonesia has a high potential for renewable energy. However, to date, the country generates less than 10% of its electricity through renewable energy. DEG customer SUN Energy has specialised in the long-term leasing of photovoltaic systems on the roofs of industrial and commercial sectors. SUN Energy installs and maintains the rooftop systems for its customers.
As one of the first movers of solar rooftop C&I business in Indonesia, it quickly became the leading company in this young and dynamic sector in Indonesia. Around 50 MW of clean electricity are installed and more than 51,229 tons of CO2 can be avoided annually, helping to achieve Indonesia's climate neutrality target by 2060. SUN Energy achieves significant development impact due to initiatives for green electrification through solar energy of public buildings, universities, commercial buildings such as shopping malls, hotels, and industrial buildings such as factories and warehouses.
DEG – Deutsche Investitions- und Entwicklungsgesellschaft mbH
Kämmergasse 22, 50676 Cologne, Germany
Phone +49 (0)221 4986-0
