Photovoltaic Market Transformation Initiative Background

The Photovoltaic Market Transformation Initiative (PVMTI) is an initiative of the International Finance Corporation (IFC) and the Global Environment Facility (GEF).
PVMTI Rationale

The aim of PVMTI is:

“… to accelerate the sustainable commercialization and financial viability of PV technology in the developing world” and
“… to provide successful examples of sustainable and replicable business models that can be financed on a commercial basis”.
PVMTI Funds

US$25 million are available for concessional funding

US$15 million for India
US$5 million for Kenya and
US$5 million for Morocco.

Concessional funds maybe provided as:

Debt (senior or subordinated)
Partial risk guarantees
Equity (to a lesser extent)
Up to 10% as grant for non-commercial activities

Leverage Requirements

In order to establish sustainable businesses beyond the end of the PVMTI programme, investee companies have to source co-financing from sponsors and other financial institutions to achieve the following leverage targets on PVMTI funds:

India : 3 to 1
Morocco : 2 to 1
Kenya : 1 to 1

Management Team

The IFC has designated Impax Asset Management Ltd. (IAM) and IT Power Ltd. as its External Management Team (EMT) for the duration of the PVMTI project. The EMT is responsible for attracting potential investee companies, for undertaking due diligence and negotiating investments on behalf of IFC, and for monitoring investment performance over the life of the project.

IAM provides fund management and advisory services to investors and is regulated by the Financial Services Authority as an investment manager. The Company has expertise in managing portfolios of listed stocks and private equity in the Environmental Infrastructure & Technology (EIT) sector. IAM has been managing and advising EIT funds since June 1998 and is currently managing and advising funds with a total value of over USD 1.5 billion.

IT Power is a leading international renewable energy and environment consultancy which specializes in renewable energy engineering and related economic, financial, commercial and environmental considerations. Since its formation in 1981, IT Power has completed more than 900 projects in over 100 countries around the world for numerous institutional and private clients.
PVMTI Project Duration

The initial investment period for projects has been extended from 31 December 2007 to 31 December 2009 and final wrap up of the project is scheduled for 30 June 2010. This extension was decided upon on account of delays in initial deal finalizations and funds disbursements.

Links to PVMTI Project Document

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