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Green Finance / Treasury & Capital Markets
Clifford Capital, Pentagreen sign green loan for bioenergy projects
BECIS to install 14 facilities that will turn agricultural waste into steam for industrial users in Southeast Asia and India
Tom King 5 Jul 2024

Clifford Capital and Pentagreen Capital have approved a green loan of US$30 million for BE C&I Solutions (BECIS) to support sustainable bioenergy projects across Southeast Asia and India.

The secured facility is provided equally by Clifford Capital and Pentagreen, with Clifford Capital as the structuring arranger and Pentagreen as the green loan coordinator.

The loan features an innovative dual-tranche structure, with Pentagreen’s tranche subordinated to Clifford Capital's commercial tranche. An accordion feature allows the loan size to increase to US$50 million, potentially unlocking US$60 million in project value.

Kelvin Tan, head of sustainable finance for Asean at HSBC and board director of Pentagreen Capital, says: “The transaction demonstrates the impact that a differentiated debt financier can have and is timely as the region looks for innovative solutions to scale decentralized energy solutions and decarbonize manufacturing processes.”

The financing aligns with BECIS’ green loan framework, which is based on the Green Loan Principles of 2023, and has received a second-party opinion from Sustainalytics.

The borrower, BECIS Bioenergy, a subsidiary of BECIS, will use the proceeds to fund 14 decentralized installations in Indonesia, Thailand, Cambodia, the Philippines, and India. These projects will convert agricultural waste and other sustainably sourced feedstock into renewable steam for industrial customers, avoiding 114,404 tonnes of carbon emissions annually.

The installations are located at industrial and manufacturing sites operated by local and multinational companies in various industries, including food and beverage, consumer goods, construction materials, and agricultural products.

Connie Chan, head of financial services at Temasek and board director of Pentagreen Capital, says: “Asia’s green transition can be realized only if we derisk the financing of sustainable infrastructure at scale. Pentagreen has demonstrated its ability in identifying opportunities to support sustainable infrastructure projects that are marginally bankable by partnering with commercial lenders to unlock the full capital flow needed to bring such projects to fruition.”

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