Jakarta. British International Investment (BII) unveiled a new five-year strategy on Thursday, including the launch of a £1.1 billion ($1.4 billion) climate finance initiative aimed at mobilizing private capital to support Asia’s transition away from coal.

The initiative, called British Climate Partners (BCP), is designed to channel large-scale investment into clean energy projects across developing Asian economies, where demand for energy is rising and reliance on coal remains high.

Asian countries accounted for roughly three-quarters of global coal demand in 2024, placing the region at the center of the decarbonization challenge. The investment gap is also substantial, with Southeast Asia requiring an estimated $210 billion annually and India at least $160 billion each year through 2030 to support the energy transition.

In Indonesia, coal still supplies around 60% of electricity and underpins energy security in Southeast Asia’s largest economy. While Jakarta has pledged to peak power-sector emissions by 2030 and reach net-zero electricity by 2050 under international initiatives, progress has been uneven due to financing constraints, slow disbursement of transition funds, and continued reliance on coal to support growth, highlighting the need for large-scale private capital to accelerate the shift.

BII said BCP will work alongside private investors to deploy capital through a mix of equity platforms and mezzanine financing, helping to reduce early-stage project risks while improving returns to attract commercial funding.

The initiative will target fast-growing economies with coal-dependent energy systems, including Indonesia, India, the Philippines, Vietnam, Thailand, and Malaysia.

“Asia’s energy transition will depend on mobilizing private capital at scale, and British Climate Partners is designed to do exactly that,” said Srini Nagarajan, managing director and head of Asia at BII. He said the platform would focus on building investment structures, de-risking projects and drawing long-term capital into commercially viable climate opportunities.

The strategy reflects a broader shift in the UK’s development approach toward partnerships that combine public and private financing. Jenny Chapman, the UK’s minister for development, said the new direction moves beyond traditional aid toward investment-led cooperation.

“Used together, this can help businesses grow, create jobs and support the reforms and policies our partners choose for themselves,” Chapman said.

Under the new plan, BII expects at least 40% of its investments over the next five years to qualify as climate finance, up from a 30% target in the previous strategy period.

The institution will also maintain its focus on frontier markets, committing at least 25% of new investments to the world’s least developed countries, where access to private capital remains limited.

In addition, BII said it will expand its “market-level impact” investments, aiming to develop entire sectors rather than individual companies, and increase its gender-focused financing. Around 30% of new investments — excluding those under BCP — are expected to meet criteria under the 2X Challenge, a global initiative to support women’s economic empowerment.