IKEA and Rockefeller join forces to invest $1 billion in clean energy push

The IKEA Foundation, the philanthropic arm of the world's largest furniture retailer, and the Rockefeller Foundation announced Monday that they will partner to set up a $1 billion worldwide platform to combat climate change and energy poverty.

The fund, which will be created this year, seeks to cut one billion tonnes of greenhouse gas emissions while also empowering one billion people through distributed renewable energy, the foundations said in a statement.

According to the Financial Times, each foundation will provide $500 million in risk capital, with the hope of attracting an additional $10 billion from international development agencies this year before opening up to institutional investors in their bid to expand renewables investment in countries such as India, Nigeria, and Ethiopia.

We’re not gambling here. We’ve seen it work in India. We know what it takes to become successful,” Rajiv Shah, president of the Rockefeller Foundation, told the Financial Times.

It aspires to provide clean and reliable power to the 800 million people globally who do not have access to energy, as well as the 2.8 billion who have unreliable access

“Millions of lives and trillions of dollars have been lost to Covid 19, forcing people back into poverty after decades of progress,” said Dr. Shah, in a statement. “The effects of the climate crisis will make this even worse, which is why we must invest now to reverse this downward spiral.”

The Rockefeller Foundation will incubate the platform in RF Catalytic Capital Inc., which it will create in 2020, to ease the collaborative investment.

IKEA wants to be carbon neutral by 2030, and Ingka Group, which owns the majority of IKEA shops, said in April that it has set aside 4 billion euros ($4.75 billion) to invest in green energy initiatives.

Their objective is to have $10 billion in financing from development agencies by the end of this year, in addition to their initial $1 billion, and then to allow commercial investors to support specific projects.

Picture Credits: ETEnergyworld