Climate Fund Managers has reached the first close of its SA-H2 Fund, also known as Climate Investor Three South Africa, securing USD 182 million in commitments, equivalent to approximately USD 182 million.

The blended finance vehicle focuses on green hydrogen and energy transition investments across Southern Africa, drawing capital from a coalition of European and South African public and private investors.

A New Vehicle for Southern Africa's Green Hydrogen Ambitions

The SA-H2 Fund is structured as a blended finance private equity fund targeting large-scale energy transition projects across the green hydrogen value chain. Its investment scope covers green hydrogen production, downstream derivatives including green ammonia and green methanol, and the decarbonisation of hard-to-abate industries such as steel, fertiliser, e-fuels and chemicals.

The fund combines public and private capital within a single platform, using public money to strategically balance risk and create conditions for institutional investors to participate.

It is divided into two structural components: a Development Tranche, which provides early-stage risk capital and technical assistance to prepare projects for final investment decision, and blended Equity Tranches designed to carry projects from financial close through to construction.

Who Committed Capital and How

Commitments to the Development Tranche were secured from Invest International, the European Commission via its Global Gateway strategy, and the Industrial Development Corporation of South Africa.

The Equity Tranches drew commitments from South Africa's Public Investment Corporation, acting on behalf of the Government Employees Pension Fund, Sanlam Life Insurance Limited, Invest International, and the European Commission. The Development Bank of Southern Africa is also listed as a supporter of the fund.

The participation of the European Commission links the fund to the Global Gateway initiative, the European Union's strategy for driving investment in partner countries.

European Commissioner for International Partnerships Jozef Síkela described the milestone as evidence that Global Gateway is creating conditions for private investors to enter high-potential markets. He said the fund supports job creation, industrial development, and decarbonisation of international industry in South Africa.

Public Pension Capital Enters the Hydrogen Sector

The involvement of South Africa's Public Investment Corporation marks a notable commitment of public pension assets to the green hydrogen space. Lucky Pane, Head of Research and Innovation at the PIC, noted that the investment aligns with a hydrogen investment strategy the organisation adopted in 2022.

He said the investment gives the PIC the ability to assist clients in diversifying their energy needs and meeting net-zero targets, while also supporting the decarbonisation of the PIC's own portfolio.

Pane credited the Government Employees Pension Fund with providing the mandate to make investments that deliver positive impact and contribute to long-term sustainability.

He also pointed to the United Nations Sustainable Development Goal 7 on affordable and clean energy as a framework underpinning the rationale for hydrogen investment.

Sanlam Extends Its Climate Finance Relationship

Sanlam Life's participation as an anchor Tier 2 investor in the Equity Tranche continues a pattern of engagement between the South African financial services group and Climate Fund Managers.

Mlondolozi Mahlangeni, Chief Actuary and Chief Risk Officer of the Sanlam Group, noted that Sanlam had previously invested in both Climate Investor One and Climate Investor Two, and described Sanlam as a shareholder in Climate Fund Managers itself.

Mahlangeni said the SA-H2 Fund would accelerate the development of green hydrogen projects essential for decarbonising South Africa's industrial sector and framed the investment as supporting a just energy transition, sustainable economic growth and long-term value creation for stakeholders and the country.

The Logic of Blended Finance in Emerging Market Infrastructure

Climate Fund Managers' chief executive Andrew Johnstone said industrial decarbonisation requires solutions that go beyond electrification, positioning green hydrogen as a critical tool as the energy transition progresses.

He described the first close as reflecting confidence in the firm's blended finance model and its track record of developing infrastructure projects in emerging markets into institutional-grade assets.

Jeroen Plag, Chief Investment Officer of Invest International, framed the layered capital structure as a mechanism for deploying capital more effectively, de-risking early-stage development and mobilising institutional investment at scale.

He said reaching first close was a strong signal of investor confidence in the green hydrogen opportunity in Southern Africa and emphasised that unlocking that opportunity required close collaboration between public and private sectors.

Broader Context Within Climate Fund Managers' Platform

The SA-H2 Fund sits within Climate Fund Managers' wider Climate Investor series, which has previously deployed capital across renewable energy and water infrastructure.

The fund's full designation as Climate Investor Three South Africa places it as a regional iteration of the firm's third thematic investment platform. Sanlam's involvement across all three Climate Investor vehicles, as both a shareholder in the manager and a fund investor, reflects an ongoing institutional relationship at the core of the platform's capitalisation strategy.

The first close of USD 182 million represents an initial step toward a larger fundraising target, with the fund expected to continue seeking additional commitments as it works toward subsequent closes and begins deploying capital into project development and construction across Southern Africa's emerging green hydrogen ecosystem.

Tracking South Africa's Hydrogen Future Before It Leaves the Station

South Africa's hydrogen sector is accelerating at a pace that rewards those who move early and penalizes those who wait. From green hydrogen export corridors to emerging electrolyzer projects, the continent's pipeline of activity is expanding faster than traditional research methods can capture.

Staying competitive in this landscape means more than reading headlines. It means knowing which projects are entering procurement, which contracts have already been awarded, and where construction activity is quietly gaining momentum across South Africa's diverse energy markets.

The Global Project Tracking (GPT) platform by Blackridge Research is purpose-built to give hydrogen industry professionals a structured, continuously updated view of the entire project lifecycle. Whether you are targeting investment opportunities, scoping supply chain entry points, or benchmarking competitor activity, the platform delivers the intelligence you need at every stage.

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