Cathay FHC leads Taiwan’s renewable energy initiatives at LSEG Climate Investment Summit during Climate Week in London

Cathay FHC’s three energy transformation directions: investment and financing in renewable energy, innovative cooperation in renewable energy, and leveraging core competencies for service innovation.

TAIPEI, June 28, 2024 /PRNewswire/ — Sustainable finance increases the competitiveness of achieving the net zero transition. Yesterday (26th), Lee Chang-Kenchairman of Cathay Financial Holdings (Cathay FHC), personally attended the ‘Climate Investment Summit’ at the London Stock Exchange (LSEG), marking his second year in a row as the sole speaker Taiwan. Building on the consensus on “Transforming the energy system away from fossil fuels” reached at the 28th United Nations Climate Change Conference (COP28) In 2023, Lee used Asia as an example to discuss challenges and solutions in promoting renewable energy, sharing Cathay FHC’s cross-industry efforts and tangible results in implementing renewable energy initiatives. It showed Taiwan the success of the financial sector in achieving a net zero transformation on a global scale.

The “Climate Investment Summit” is an iconic platform for global climate solutions, taking place in the historic LSEG financial center. Cathay FHC not only became the only Taiwanese financial institution to be invited back to the summit, but also acted as a bridge in the energy transition dialogue between EuropeAmerica i AsiaThis means international recognition Taiwan involvement and achievements of the financial industry in the field of energy transformation. Lee participated in the summit discussion on “Renewable Returns: The Business Case for Mature Energy Technologies,” sharing how Cathay FHC supports the development of low-carbon industries through capital and innovative financial services. Cathay FHC has been recognized as an example of global best practice on the Investor Agenda for two years in a row for its Investor Climate Action Plans (ICAP), making it the only selected asset owner in Asia.

During the panel, Lee pointed out problems and solutions to help promote renewable energy in Southeast Asiashared the history of the Taiwanese government’s efforts to promote renewable energy and discussed Cathay FHC’s role as a pioneer in this field. Cathay FHC continues to lead the initial implementation, helping the market understand feasibility. “We are also pleased to support various innovative models that will bring benefits in the future,” Lee emphasized. It is noted that Asia is the main source of growth in global electricity demand and still relies heavily on fossil fuels. Southeast Asian governments should continue to increase policy stability and strengthen infrastructure, making good use of financial tools such as guarantees or blended financing to reduce the cost of capital and investment risk in emerging markets. They should also address just transition issues, such as staffing, to ensure the success of the energy transition.

Cathay FHC is the sixth financial institution in Asia to establish an SBT endorsed by the Science Based Targets Initiative (SBTi). It has committed to achieving net zero carbon emissions from its financial assets by 2050. Cathay FHC is also the first RE100 member of Taiwan’s financial industry and a pioneer in renewable energy financing in TaiwanIn the field of low-carbon transformation and renewable energy innovation, Cathay FHC continues to lead the way in trial implementations, helping the market understand feasibility and becoming a key driver of renewable energy in Taiwan. In 2023, Cathay FHC’s renewable energy consumption was 17.95 million kWh, and by the end of 2023, the total amount of low-carbon investments and financing was NT$330.5 billion (roughly equivalent $11.7 billion).

Regarding Cathay FHC’s path to promoting renewable energy development, Lee outlined three main strategies. The first strategy is “Strengthening Renewable Energy Investment and Financing.” In 2023, Cathay FHC’s cumulative renewable energy investment and financing reached NT$63.3 billion (about $2 billion), with a solar installation capacity of 1,504 MW. Cathay United Bank was a pioneer Taiwan first financing for solar and offshore wind; Cathay Life Insurance became Taiwan the first life insurance company to establish a photovoltaic investment company, Cathay Power. Recently, the company has been developing renewable energy in areas deemed unsuitable for agricultural purposes by the Ministry of Agriculture, realizing a mutually beneficial scenario of land revitalization and renewable energy development, while increasing energy production to meet market demand.

Second, Cathay FHC promotes “innovative renewable energy cooperation.” Lee believes that Cathay FHC’s emphasis on stakeholder success, active attempts at innovation collaboration and searching for appropriate directions to identify success stories are the reasons why Cathay FHC can continually overcome challenges and accelerate the development of renewable energy. Cathay Power, for example, aims to think systematically about agrivoltaics, creating a standardized, scalable and sustainable agrivoltaics model. Collaborating with the government to launch an agrivoltaics experiment, the “Agri-Light Project” in Dalin, Chiayi, is an innovative plan that integrates blacksmith grass cultivation with photovoltaic technology. This initiative solves several problems: it is expected to reduce Taiwan reliance on imported feed and mitigates the risk of international supply chain instability while avoiding negative impacts on local agriculture. In addition, animal manure can be used to produce energy from biogas, and the residues serve as organic fertilizer, thus promoting sustainable and circular agriculture Taiwan.

Third, Lee emphasized the importance of “leveraging core competencies for service innovation.” Facing the multiple challenges that climate change poses to businesses, Cathay FHC is proactively seeking solutions by leveraging its core financial competencies to offer diverse, innovative services, turning challenges into opportunities. For example, Cathay Securities worked closely with the blockchain team at Cathay FHC’s Digital Data & Technology Center (DDT) to develop the Security Token Offering (STO), Taiwan first hundred. The issue concerns a 6-year debt-based STO offering an annual interest rate of 3.5%. Combined with the preferential purchase mechanism of electric machinery, the overall investment return increases significantly, helping green energy enterprises raise funds from professional investors and increasing investor confidence. Small and medium-sized enterprises often have difficulty purchasing green energy on their own. How Taiwan the largest owner of commercial real estate, Cathay Life consolidates the purchase and distribution of green energy, enabling our tenants to obtain it more efficiently. This approach plays a key role in bridging the gap between supply and demand for renewable energy. In 2023, 18 companies received a total of 13.49 million kWh of green energy.

Lee further stated that Cathay FHC is committed to working with partners and customers across sectors to jointly pursue more climate solutions. About coming July 3the annual “Cathay Sustainable Finance and Climate Change Summit” will focus on net zero solutions and sustainable finance. The summit will bring together distinguished experts and leading companies in the field of sustainable development, including: Sam KimminsDirector of Energy at the Climate Group, who will share forward-looking perspectives and industry practices. The event aims to help Taiwanese companies accelerate climate action and showcase Taiwan industrial achievements and commitment to net zero goals internationally.

SOURCE Cathay Financial Holdings