Climate Fund Managers Secures $140 Million GCF Approval for Industrial Decarbonisation

Climate Fund Managers has secured approval for $140 million in catalytic financing from the Green Climate Fund (GCF) to advance industrial decarbonization and green hydrogen infrastructure in Southern Africa. Announced on 28 October 2026, the funding will support Climate Investor Three (CI3), a global blended finance facility targeting investments in renewable energy, green hydrogen, low-carbon fuels and hard-to-abate industries. The GCF's 46th Board meeting in Songdo, South Korea, approved the financing, which is intended to help mobilize additional private investment toward CI3's $1.2 billion fundraising target.

 

Of the approved funding, $84 million will be allocated to the SA-H2 Fund in South Africa through its Construction Equity Tranche. The remaining $56 million will support SDG Namibia One Fund, comprising $15 million for early-stage project development and $41 million for construction equity. The Southern African Industrial Decarbonization Facility (SIDF) will provide the financing, with the Development Bank of Southern Africa (DBSA) serving as the GCF Accredited Entity responsible for program oversight, monitoring, and reporting. The blended finance structure uses catalytic capital to reduce development and construction risks, making projects more attractive to institutional and commercial investors.

 

Read more: Deutsche Bank Reports Record €32 Billion in Q3 Sustainable and Transition Finance

 

The Southern African facility aims to support 30 to 40 industrial decarbonization projects, install about 1.52 gigawatts (GW) of renewable energy capacity, and avoid an estimated 24.2 million tonnes of greenhouse gas emissions. Investment priorities include green hydrogen production, green ammonia, green methanol and infrastructure supporting lower-carbon industrial value chains. Catherine Koffman, Regional Director for Africa at GCF, described SIDF as the fund's first platform dedicated to decarbonizing industrial value chains in Africa. These figures are program targets, not completed investments or verified emissions reductions.

 

The financing builds on existing investment commitments and project development activities in both countries. In South Africa, SA-H2 has signed development funding agreements supporting Hive Hydrogen's Coega green ammonia project and Green eFuels Producers' wastewater-to-green-methanol facility. In Namibia, SDG Namibia One has signed agreements involving Hyphen's green hydrogen development, HyIron's Oshivela green iron project, Zhero Molecules' Walvis Bay green ammonia project, and the Dâures green fertilizer project. CI3 has also secured €150 million in initial Development Tranche commitments from Invest International and the European Commission, while SA-H2 reached a first close of approximately $182 million in August 2026.

 

Andrew Johnstone, Chief Executive Officer of Climate Fund Managers, said, "By helping to mitigate these risks, GCF’s catalytic financing can attract institutional investment into commercially viable projects and support competitive, low-carbon industrial growth." The approval strengthens the financing framework for industrial energy transition projects in Southern Africa, where high upfront costs and development risks can constrain investment. Its longer-term impact will depend on securing additional private capital, reaching financial close on individual projects, and delivering measurable emissions reductions alongside industrial and economic development benefits.

 

Source: Climate Fund Managers