Camco's Impact in 2020
Our Commitment
Welcome
In a world of climate change and increasing inequality it can sometimes be hard to remain optimistic. But at Camco we know that solutions are already available and clean energy is already one of the best.
That’s why we’re getting on with it, providing practical financing solutions to scale the clean energy transition and bring forward a world that is smarter, healthier, safer and free-er.
This report is Camco’s first annual impact report, and also serves as our second Communication on Progress to the UN Global Compact, which we signed up to in April 2019. As you will see, sustainability underpins everything we do at Camco, shaping our approach to investing, how we manage the company and our team, the way we work with clients and partners, and the world we want to create.
Camco as a company was founded in 1989 and has evolved over time to become the leading climate and impact fund manager that it is today.
We manage the Renewable Energy Performance Platform – or REPP – which is a USD 200m UK government-funded facility that responsibly invests in small- and medium-size renewable energy projects across Sub Saharan Africa.
We also recently established the innovative USD 3m Spark seed facility for deployment into pilot commercial and industrial renewables and energy efficiency projects in Kenya and South Africa. Camco is already raising an extra USD 100m to execute on a strong deal pipeline.
And in January this year Camco became an Accredited Entity for the Green Climate Fund (GCF) which is a really exciting development for the company and one that enables us to propose private sector programmes to GCF for up to USD 250m of GCF money per programme.
As a climate and impact fund manager, we recognise the huge responsibility and opportunity we have for supporting both the Paris climate targets and the Sustainable Development Goals. Both remain core objectives of our work.
We are taking urgent action to combat climate change and its impacts in alignment with SDG13 by decoupling economic growth and carbon emissions and supporting implementation of countries’ climate policy, and we are supporting universal clean and affordable energy access as laid out in SDG 7 by investing in innovative renewable energy solutions.
We also prioritise SDG 9, which is about building resilient infrastructure, promoting inclusive and sustainable industrialisation and fostering innovation, by upgrading and retrofitting industries to make them more sustainable, resource-efficient and by adopting clean technologies.
Our impact does not end there. By providing first-time access to electricity and good jobs through our investments, for example, we support the first SDG to end poverty in all its forms. By limiting the use of pollutants through the deployment of clean technologies we support SDG3 and the promotion of good health and well-being, and by investing in women-owned or managed businesses and by promoting gender equality and social inclusion, we actively support SDG5. You can read more about our work in support of the SDGs in the Creating Sustainable Value section of this webpage.
Of course, the scale of the challenge in meeting climate action targets and the SDGs is huge, and the arrival of COVID-19 in late-2019 has made achieving these targets more challenging. On our part, we have increased our efforts to help tackle the energy challenges faced in developing countries and climate change more broadly by applying innovative financing solutions to sustainable energy and helping to rebuild into a more inclusive, more resilient, and more sustainable future.
Through the REPP fund, we have offered all investees COVID-19-related financial support and gave six-month interest moratoriums to help offset decreases in revenue and project delays. A separate COVID Working Capital support facility was also established to provide short-term working capital loans to help REPP investees and other renewable energy companies through the financial difficulties of the pandemic. But with the virus still showing no signs of abating, we know that the bulk of the work is likely still ahead of us and we remain committed to doing everything we can to support the projects, businesses and communities through this challenging time, just as we are to supporting the SDGs and global climate action.
Thank you for visiting the site and I hope you enjoy reading about our work.
A Year in Review
2020 was an extraordinary year. The personal impact of COVID-19 on the team and the many people we work with has of course been deeply felt, and like everyone we are all hoping for a sense of normality to return very soon.
At a company level, Camco enjoyed a year of progress and development, welcoming more talented and experienced individuals to our team and opening new doors for the business to grow. These are some of the highlights:
During 2020, Camco had USD 203m assets under management.
Camco established Spark Energy Services, an innovative USD 3m seed facility for deployment into commercial and industrial renewables and energy efficiency projects in Africa. With the first project successfully completed and others on the way, Camco is already raising funds to unlock a strong deal pipeline.
Camco was approved to become a Green Climate Fund Accredited Entity. The company can now put forward proposals to the Fund – for third parties and on our own behalf - and then oversee, supervise, manage, and monitor these proposals when approved.
Camco became authorised and regulated by the UK Financial Conduct Authority as an Alternative Investments Fund Manager.
Ten new recruits joined the Camco team over the last year, increasing the team size by more than a third and taking the total up to 26. Meet the team here.
Camco’s Board established a Sustainable Business Committee and Audit and Risk Committee to provide independent oversight and guidance across the company’s operations.
Camco hosted numerous capacity-building events for our project partners and the wider clean energy community over the year. These included well-attended webinars on gender mainstreaming and the importance of fit-for-purpose shareholders agreements and the REPP Academy for investees of the Camco-managed Renewable Energy Performance Platform (REPP). We also launched two free-to-use toolkits, co-developed an open-source investment resource with CBEA and its partners for the mini-grid sector, and released several publications including our first Communication on Progress as a UN Global Compact signatory, the Talking Points interview series with REPP investees in partnership with ESI Africa and a new quarterly impact report for REPP.
Camco continued to assert its position as a thought leader in the clean energy sector in 2020 with senior team members appearing regularly as guest speakers and panellists at notable industry events including Africa Energy Forum and the UK-Africa Renewable Energy Ministerial Symposium. We also revamped our weekly newsletter to include more direct commentary on industry developments, and provided interviews and opinion pieces for ESI Africa, EnergyNet and other industry publications.
Camco was recognised as the Renewable Energy Fund Manager – UK at EU Business News’ European Enterprise Awards 2020.
2020 Impact Highlights
Impact Approach
Our Vision
In the context of climate change and increasing inequality it would be easy to lose optimism. But at Camco we know that the solutions are already there, and that clean energy is one of the best.
That’s why we’re getting on with it, providing practical financing solutions to scale the clean energy transition and bring forward a world that is more abundant, affordable and profitable. A future for everyone that is smarter, healthier, safer, and free-er.
A brighter future, today.
Camco is a climate and impact fund manager, building towards a sustainable, low-carbon future. We engage in responsible investment that incorporates environmental, social and governance (ESG) factors into investment decisions to better manage risk and generate sustainable, long-term returns.
All investment activities carried out by Camco are governed by our own policies and procedures , as well as those applying to the third-party funds/facilities that Camco manages.
The chart below provides an overview of our investment approach:
Invest responsibly
Camco has established an effective environmental and social management system (ESMS) that is implemented by the company’s Responsible Investment Implementation Unit and supervised by senior management, the Sustainable Business Committee, and the Board of Directors. All projects, developers and financial intermediaries supported by Camco are required to not only meet host-country legislation, but also comply with the International Finance Corporation (IFC)’s Environmental and Social Performance Standards and the sustainability principles advocated by the UN Global Compact.
As a result, Camco ensures through its due diligence, monitoring and review processes that:
- environmental, social, ethics and integrity risk screening and due diligence are carried out on all investees prior to funding;
- environmental and social impact assessments (ESIA) for projects fulfil the required standards; and
- each investee establishes and implements its ESMS, and monitors it on an ongoing basis.
All companies and projects supported by funds managed by Camco need to:
- assess their environmental and social impacts in the form of an ESIA, including impact on human rights, workers’ rights and the rights of indigenous peoples;
- establish, implement and maintain an ESMS, including all necessary management and action plans (see diagram below)
- monitor and evaluate project performance against the ESIA and ESMS; and
- report ongoing compliance and activity transparently to Camco on a quarterly basis.
Elements of an ESMS
Principles of governance
Camco’s approach to governance is grounded in our commitment to integrity, accountability and transparency. In support of this, we have established sound internal controls and structures to effectively implement, manage and report on the impact and outcomes from the funds we manage. We also monitor the fitness of the ESG process through periodic monitoring reports and annual reviews.
Camco ensures awareness and understanding of its policies and procedures among employees and investees through regular internal training. Investees’ compliance with the polices is ensured through periodic monitoring and reporting of key performance indicators, and their performance against their ESMSs and parameters identified in their gender action plans.
Roles and responsibilities explained:
- Camco’s Board of Directors (Board) supervises ESG compliance and the performance of the company’s contractual obligations in relation to funds managed
- Camco’s senior management oversees the work of Camco’s Responsible Investment Implementation Unit and signs off due diligence and annual reviews.
- The Sustainable Business Committee works to monitor the social, ethical and sustainability performance of Camco and its subsidiaries and funds under management and makes recommendations to the Board in relation to how such performance can be improved.
- The Audit and Risk Committee acts as a standing subcommittee of the Board to oversee and report to the Board on all Camco’s audit and risk matters. This is to ensure the independence and effectiveness of internal and external audit and risk functions, as well as to vet the company’s approach to risk management and the integrity of its financial and narrative statements.
Camco’s ESG governance structure
How we measure impact
Camco’s approach to impact monitoring is grounded in the Ten Principles of UN Global Compact in the areas of human rights, labour, environment and anti- corruption, as well as the UN Sustainable Development Goals (SDGs) and their underlying targets. We have outlined the objectives, standards and principles Camco follows in our Environmental and Social Safeguards Policy to ensure that the environmental and social performance of the projects and investee companies supported by Camco are sustainable.
Following extensive analysis of best practice frameworks from across the industry in 2020, a monitoring and evaluation methodology has been developed specifying 36 performance indicators to measure Camco’s performance. The methodology and performance indicators are aligned with our own Vision and the impact goals of our investors as well as the following standards:
- Global Reporting Initiative Standard
- International Finance Corporation Performance Standards
- IRIS+ metrics
- Principles of Responsible Investment
- The Impact Management Project’s five dimensions of impact
- UN Global Compact’s Ten Principles
- UN SDGs
- World Economic Forum’s Towards Common Metrics and Consistent Reporting of Sustainable Value Creation
Camco's alignment with reporting indicators
Successful monitoring requires collaboration with investee companies, which Camco actively encourages by:
- Training investee companies in our ESG, monitoring and evaluation requirements and procedures at the time of signing a Term Sheet;
- Agreeing on a monitoring plan as part of the ESMS (to be part of the investee’s obligations pursuant to its Support Agreement) with each investee; and
- Collecting performance and ESG data and supporting documents on a periodic basis, as agreed with each investee.
Reporting is based on objective, self-reported data on performance indicators by investees, such as number of customers connected to electricity, kWh electricity and number of jobs created by gender and skill level produced. All investees undergo an annual review to verify performance and the implementation status of the ESMS, as well as demonstrate compliance with local laws and regulations.
The performance indicators reported and presented in sections below are grouped together according to the following four principles:
- Principles of governance
- Impacts on people
- Impacts on planet
- Impact on prosperity
Creating Sustainable Value
Targets
As a climate finance and impact fund manager investing in renewable energy and energy efficiency projects in developing economies, sustainability underpins everything we do and strive for at Camco. We only back projects and companies where negative environmental and social impacts can be satisfactorily mitigated within reasonable timescales, and only projects categorised low or medium risk - categories C/I-3 and B/I-2, respectively, according to IFC’s environmental and social categorisation - are eligible for our support. The very nature of Camco’s business means the company’s negative impact on the environment is small, but the positive impact on people and planet is significant.
Through its management of the USD 200m UK government-funded Renewable Energy Performance Platform (REPP), Camco is working to stimulate the development of a vibrant, networked and viable market for small and distributed renewable energy projects in African countries. Such a market is fundamental to helping ensure access to affordable, reliable and sustainable energy for all of the nearly 600m people still living without electricity in Sub-Saharan Africa and for taking urgent climate action.
Similarly, commercial and industrial businesses operating in Africa face major energy challenges that make it difficult to run their businesses profitably and sustainably. The Camco-seeded USD 3m Spark pilot facility targets the efficient deployment of capital for commercial and industrial project implementation in Africa. This requires the execution of many small deals without introducing unnecessary financial risk, which it does by partnering with - and building the capacity of - suitable project developers.
By the end of 2020, the following energy and climate impacts had been achieved through the REPP fund:
- 580,000 people connected to electricity for the first time, with finance committed to projects that will lead to a further 1.8 million people being connected.
- 8.4MW operational renewable energy capacity with 10.3MW under construction and finance committed towards a further 101 MW.
- 16,095 tonnes of greenhouse gases mitigated, with an anticipated reduction of 240,000 tonnes per year by the end of 2023 through REPP’s current project portfolio.
Investment impacts
Planet
Building a carbon neutral world
Camco protects the planet from degradation through investment in clean energy technologies which mitigate greenhouse gas emissions and support the implementation of countries’ climate change and energy policies and their Nationally Determined Contributions (NDCs) to the Paris Agreement. The below table provides an overview of our impact to planet.
People
Inclusion increases resilience
By financing affordable clean energy solutions, Camco works towards a future that is smarter, healthier and safer for everyone.
Contribution to beneficiaries
Camco takes responsibility and due regard for the effects its funding may have on local communities and individuals.
The beneficiaries of Camco-managed funds are communities and businesses in underserved markets that will gain access to a reliable source of clean electricity where, prior to the intervention provided, they often either had no supply of electricity or the supply was unreliable. At the customer level, renewable energy projects also offer multiple environmental and social co-benefits contributing towards the achievement of different SDGs. See here for more on Camco’s contribution to the SDGs.
Other beneficiaries are the investees themselves (i.e. private sector developers of small-scale renewable energy projects) and energy services companies, which will benefit from markets seeded by Camco-managed funds REPP and Spark.
Occupational health and safety
In 2020, the overall occupational health and safety performance of investee companies was good. However, two employees of one of the investee companies were tragically killed in motorcycle accidents while at work. This prompted a further review of how occupational health and safety procedures and training to encourage the use of personal protective equipment and safe driving practices could be improved. The procedures in place were considered sufficient; however, the investee company has since improved the monitoring of driving practices through trackers, increased the frequency of regular health and safety training and appointed a dedicated field team to enforce all safety guidelines and policies.
Of the 22 injuries recorded, the majority were small although five incidents required hospitalisation. All injured employees have recovered and returned to work. In all incidents, a good level of financial and medical support was provided by the investee company involved.
Enabling change
Through the funds it manages, Camco is working to stimulate the development of a vibrant, networked and viable market for clean energy projects in emerging markets by investing in clean energy solutions, mobilising private and public sector finance, and providing capacity building and training. Similarly, it creates decent job and income generation opportunities, and promotes gender equality and inclusion.
To date, Camco, through REPP, has dedicated 35% of all funds invested through the programme to women-owned and/or led businesses in accordance with the 2X Challenge’s gender lens investment criteria.
2X Challenge’s gender lens investment criteria for power sector
Investees’ contribution to prosperity
Govern well
In 2020, we continued to educate Camco’s investee companies in sustainable corporate governance through our policy and process onboarding and the REPP Academy, which is an annual capacity-building event for REPP investee companies.
The main governance indicators our Investees measure and report on are presented in the below table.
Camco
The Camco team
As an employer, Camco is committed to providing a safe working environment, as well as fair employment practices and providing for the health and wellbeing of its team members. Similarly, it requires its investees to establish health and safety policies and procedures and a grievance mechanism.
As a company, we strive to achieve diversity in the workforce, not only because it better reflects the markets in which Camco does business, but because it leads to better business results and a more interesting and enjoyable working environment. Currently, 46% of our team members are women and 38% are from Black, Asian and Minority Ethnic groups as per the UK government’s guidance on race and ethnicity. Meet the team.
In 2020, as a follow up to our 2019 gender action plan, we established a diversity action plan and committed to undertake annual pay gap analyses accordingly, the first of which showed that Camco had successfully embedded the principle of equal pay for equal work.
Each year, Camco conducts a staff survey on the quality of work life and how to improve the company’s working culture. The Making Camco Better survey has had an overall participation rate of 100% and shown that the vast majority (> 90%) of employees find their work meaningful and impactful and that they enjoy the company culture. In early 2020, an Employee Director was appointed to the Camco Board to ensure employee representation.
The table below summarises performance indicators related to the health, safety and security of employees. For details of job creation and electricity connections, see the Prosperity section here.
Camco's carbon footprint
Camco’s carbon emissions, which consist of scope 2 and 3 emissions as per the Greenhouse Gas Protocol’s GHG Inventory Reporting guidance, reduced by 73% in 2020 compared to 2019 footprint due to COVID-19-related travel restrictions. The company’s positive mitigation impact grew by over 4,000% compared to 2019 due to the increase in operational renewable energy capacity through Camco’s investments.
Prosperity
Finance committed by country
Overview of Camco’s contribution to prosperity
Camco's governance
In 2020, we operationalised Camco’s Sustainable Business Committee, Audit and Risk Committee and an internal audit function to improve the monitoring of Camco’s social, ethical and sustainability performance and risk management.
The timeline below provides an overview of our key sustainability actions to date.
The main governance indicators we measure and report for Camco are presented in the below table.
Camco conducts an annual Making Camco Better staff survey on the quality of work life and how to improve the company’s working culture. The survey has had an overall participation rate of 100% and shown that the majority of employees find their work meaningful and impactful and that they enjoy the company culture. In early 2020, an Employee Representative was appointed to the Camco Board to ensure employee representation.
Camco’s contribution to SDGs
Partnerships
Bold and transformative steps are needed to shift the world onto a sustainable and resilient path. In recognition of this, we work in partnership with actors from the private, public and not-for-profit sectors to finance and implement clean energy projects, as well as to contribute to knowledge development and advocacy to strengthen the enabling environment for the implementation of SDG7 and SDG13.
