TPG Raises $5.4 Billion for Climate Fund Chaired by Hank Paulson

(Bloomberg) -- TPG has brought in $5.4 billion for its climate investing strategy, making it one of the biggest sustainability-focused funds raised so far as firms push further into green strategies.

The TPG Rise Climate fund, launched earlier this year, has set a hard cap, or maximum fund size, of $7 billion and expects to hold a final close in the fourth quarter, according to a statement Tuesday. TPG added former Treasury Secretary Hank Paulson earlier this year as executive chairman of the fund, joining firm co-founder Jim Coulter, who is its managing partner. It will focus on key areas including clean energy, enabling solutions, decarbonized transport, greening industrials and agriculture and natural solutions.

Read more: Former Treasury Secretary Paulson Joins TPG for New Climate Fund

Investors are channeling more money toward clean energy and other technologies to help address climate change. Governments and companies will need to invest as much as $5.8 trillion annually in infrastructure until 2050 in order to help cut emissions fast enough to prevent the worst effects of global warming, according to BloombergNEF. Earlier this month, General Atlantic announced a new strategy that was said to be targeting $4 billion for investments in fast-growing companies related to climate change.

Some of the institutional investors backing TPG’s climate fund include Allstate Corp., the Ontario Teachers’ Pension Plan and the Washington State Investment Board, according to the statement.

“TPG Rise Climate includes a unique group of global institutional and corporate investors that are united by capital, innovation, and accountability,” Paulson said in the statement. “This new blend of capital and broad commitment to action is a meaningful acknowledgment of the opportunity to make a difference in the trajectory of climate change.”

TPG is forming the Rise Climate Coalition, which “will convene regularly to accelerate knowledge exchange, investment opportunities, and best practices,” according to the statement.

Michael Bloomberg, the founder and majority shareholder of Bloomberg LP, the parent company of Bloomberg News, is a founding member of the coalition.

The New York Times earlier reported the fundraising news.

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