POWERING ASIA’S GREEN TRANSITION THROUGH BLENDED FINANCE
How the Green Investments Partnership is unlocking capital for high-impact projects across emerging Asia
Interview with Munib Madni CEO of the Financing Asia’s Transition Partnership (FAST-P)
Few regions illustrate the urgency of the energy transition as starkly as Southeast Asia. Home to more than 650 million people and some of the world’s fastest-growing economies, the region has expanded rapidly over recent decades. But that growth has come at a cost.
Between 1990 and 2020, carbon emissions rose by around 250%, and they continue to increase by 3–5% per year as energy demand climbs and fossil fuel use continues. As Munib Madni, CEO of the Financing Asia’s Transition Partnership (FAST-P), puts it: “The bigger picture is that Southeast Asia is growing, and with that comes more emissions. Unless something is done about it, that trajectory will continue.”
The challenge is not a lack of ambition or opportunity. The region has vast potential for renewable energy and green infrastructure solutions. What’s missing is financing, especially for the small and mid-sized projects that can drive decarbonization close to where emissions occur. This is where blended finance can make a difference – and it’s why FAST-P launched the Green Investments Partnership (GIP).
“The bigger picture is that Southeast Asia is growing, and with that comes more emissions. Unless something is done about it, that trajectory will continue.”
About FAST-P and the Green Investments Partnership
FAST-P is a Singaporean blended finance initiative capitalized with USD 500 million in catalytic funding. Its aim is to mobilize as much as USD 5 billion in green infrastructure investments across Asia by derisking projects that commercial investors would otherwise overlook.
Within FAST-P sits the GIP: a blended-finance fund managed by Pentagreen Capital, a joint venture between Temasek and HSBC. The GIP focuses on “marginally bankable” projects: those with strong impact potential but limited access to capital, largely due to perceived high risks. The GIP’s model is simple but pioneering, taking a fund-level approach rather than financing projects one by one. Munib is enthusiastic about its potential: “We’re seeing blended finance enter a new phase. Historically it was delivered project by project, but now platform approaches are emerging. That’s how the dream of ‘billions to trillions’ might eventually come true.”
The fund reached a first close of USD 510 million in September 2025. Within months, it had already committed USD 110 million to four projects, with significant climate-impact potential.
Bringing Asia’s transition to life: Citicore Solar Energy Corporation
One of the GIP’s first investments is with Citicore Solar Energy Corporation in the Philippines. Pentagreen extended USD 55 million to support the development of 11 solar and battery energy storage assets, including a landmark 197-megawatt solar plant paired with a 320-megawatt-hour battery energy storage system. Individually, these assets are not large. Collectively, they represent an innovative model for scaling distributed renewable energy. “Traditional banks might have been shy about funding this,” Munib explains. “But the Green Investments Partnership was able to deliver the right size and scale of financing this business needed.”
“We’re seeing blended finance enter a new phase. Historically it was delivered project by project, but now platform approaches are emerging.”
Citicore’s ambition is substantial: to develop 1,000 megawatts of new solar capacity per year. This first round of financing helps “start the ball rolling,” says Munib, demonstrating the commercial viability of the model and paving the way for future investors.
The other investments in GIP’s portfolio include loans to solar development platform, ib vogt, to accelerate utility-scale solar and battery storage projects across Southeast Asia, and to BECIS, an energy as a service provider, to catalyze the construction of distributed sustainable bioenergy projects across Southeast Asia and India.
“These are great examples of near or marginally bankable businesses,” says Munib. “Individually, they’re too small for banks. But collectively, they have scale – and that’s where the Green Investments Partnership can step in.” And Pentagreen is already seeing interest from similar companies seeking financing – evidence, as Munib puts it, that “success begets success.”
Why these projects need blended finance
Financing such projects is often difficult. “For Southeast Asia to transition and decarbonize, the region needs around USD 150–180 billion per year to invest in green infrastructure,” says Munib. “Governments don’t have that money, and private investors won’t enter unless the perceived risk is reduced. That’s why blended finance is essential.”
Blended finance allows catalytic capital to take on more risk, enabling other investors to participate in tranches that meet their risk appetite. For example, commercial investors (that typically have a low risk appetite) can participate in senior positions in the fund, which is expected to be close to investment grade.
But financing tools alone are not enough; private investors also want to work with fund managers who understand their commercial reality. As Munib says: “If we want to crowd in private investors, we need experienced fund managers who speak the language of risk and return.”
“Governments don’t have that money, and private investors won’t enter unless the perceived risk is reduced. That’s why blended finance is essential.”
FMO’s role as anchor investor and ESG partner
FMO supported the GIP with a USD 99 million commitment – of which USD 49 million in mezzanine finance (backed by a guarantee under the European Commission’s EDFI – Renewable Energy Transition (E-RET) program) and USD 50 million in senior debt. It was FMO’s first investment under E-RET and one of its largest debt fund investments to date.
Aswin Valappil, Investment Officer at FMO, explains: “Our purpose in investing in the fund was to help amplify the impact potential and reach, as well as to mobilize commercial investors in the senior tranche. The E-RET guarantee helped by allowing us to manage the risk in the mezzanine tranche.”
GIP offered FMO a strategic opportunity to help close a climate-finance gap in a region where direct project traction has historically been limited. But FMO’s role went beyond capital. “Having a reputable name like FMO in the capital stack gives others a lot of confidence,” explains Munib. “Their experience in emerging markets made them a natural partner.” Zeynep Baris, Senior Associate at FMO, says: “The fund was attractive to FMO as it focuses on a key financing need in a region that FMO is keen to support.” FMO also helped shape the fund’s environmental, social and governance (ESG) standards. “They created very high guardrails,” Munib notes. “We’re beneficiaries of that – it lifted the bar for everyone.” Zeynep adds: “The fund manager’s willingness to cooperate on ESG standards was an important consideration for us as well.”
Scaling up impact through replication
The next steps will focus on deploying capital and tracking climate outcomes, from avoided emissions to supply-chain decarbonization. The expectation is that early success will attract more investors, enabling future rounds of financing to rely less on catalytic capital. If successful, the GIP model could serve as a blueprint for other emerging regions struggling with similar barriers.
Blended finance, Munib concludes, must ultimately be temporary: “The catalytic component should be time-bound. The marginally bankable should become bankable – that’s how scaling happens.” For now, the early signs are promising: real projects, real impact, and the beginnings of a replicable model for financing the energy transition.