Goldman Sachs Alternatives has created a dedicated private credit strategy for financing climate projects. The vehicle has already netted US$1 billion of institutional equity. “Sustainable solutions have emerged as a key thematic for many corporations, while innovation and scale are increasing the cost-effectiveness of many climate solutions, and policy considerations are creating unique market opportunities,” Goldman Sachs stated. The Climate Credit strategy will look to capitalise on a “significant opportunity” created by a scarcity of private debt capital coupled with increasing demand. Goldman Sachs also noted that given regulatory changes, tax incentives, and the maturation of climate transition industries, companies are increasingly seeking flexible debt capital to meet their financing needs. This new strategy is managed by the Private Credit business at Goldman Sachs Alternatives, which has invested in environment and climate solutions for almost two decades. “We see significant opportunities to address the supply-demand imbalance in private credit solutions related to climate transition,” said James Reynolds, Global Co-head of Private Credit at Goldman Sachs Alternatives. “Substantial capital has been raised for private equity investment in the space and debt solutions are needed to provide further scale. We look forward to partnering with leading companies and financial sponsors to deliver performance for our clients and are deeply appreciative of the support we have received so far from investors in this new strategy.”
