1. 1 MIF  1 of 12 The Multilateral Investment Fund (FOMIN) A partner for promoting market-based solutions to climate change Zachary Levey FOMIN, Access to Basic Services Unit IDB Sustainable Energies Day November 3, 2010

2. 2 MIF  2 of 12 Content I. FOMIN VC and Climate Change Background II. Project Example: MicroCarbon Development

3. 3 MIF  3 of 12 FOMIN has supported early-stage financing for small firms working in clean energy and energy access Venture Capital Funds focus on Clean Energy FondElec Latin American Clean Energy Services Fund (FLACES) US$31.6M equity investment fund focused on energy efficiency Clean Technology Fund (CleanTech Fund ) US$25.2M equity investment fund Central American RE and Cleaner Production Facility (CAREC) – small clean energy projects US$17M mezzanine financing facility Some Lessons Learned NGOs make bad fund managers – financial sustainability subordinate to environmental benefits Energy and Financial Expertise needed in Management Team Focused and Disciplined Investment Strategy

4. 4 MIF  4 of 12 Next-generation carbon venture facility - focused on early stage carbon finance opportunities in LAC. Equity and mezzanine financing opportunities in demand-side energy efficiency programs. May invest up to 20% of committed capital to pilot new areas, such as forest and land- use carbon sectors. Seeks to demonstrate new models for low carbon investment in the region. General Partner will be MGM Innova Capital, LLC. MCD ² F Overview

5. 5 MIF  5 of 12 Dual Cash Flow Streams - Carbon credit sales and consumer loan repayments, energy savings, and electricity generation. Financing instruments - MCD²F will utilize equity and mezzanine financing structures based on carbon asset potential and investment type. Investment Focus - The primary investment focus will be demand- side energy efficiency. Target Countries - MCD²F will be a regional facility, but will initially focus on Colombia, Mexico and Brazil. Investment Strategy Highlights

6. 6 MIF  6 of 12 Investment Structures ESCO like investments with paybacks in energy savings and carbon Consumer loans for energy efficient appliances, payback in interest and carbon Non-recourse upfront payments secured by carbon delivery and other collateral Project Types (ESCO and Consumer Loan) Street lighting, building lighting and CFLs Refrigerators Air Conditioning Solar Water Heaters Project Types (Upfront Payment) CDM projects that meet MCD²F investment criteria Voluntary pre-compliance projects that meet the MCD²F investment criteria Forestry (REDD and AR) Project types

7. 7 MIF  7 of 12 CONTACT: Zachary H. Levey ZacharyL@iadb.orgZacharyL@iadb.org