Latest update on climate finance

The International Institute for Sustainable Development (IISD) provides the May update on global developments in climate finance.

May 2015 Climate Finance Update

Climate finance-related news and announcements during May 2015 were published by the African Development Bank (AfDB), the Inter-American Development Bank (IDB), the Adaptation Fund, the UN Development Programme (UNDP), the Global Environment Facility (GEF), the World Bank, Asia-Pacific Economic Cooperation (APEC), the Partnership on Sustainable Low Carbon Transport (SLoCaT) and the UN Office for Disaster Risk Reduction (UNISDR). AfDB, IDB, the Asian Development Bank (ADB), the European Investment Bank (EIB) and the World Bank launched studies, reports and stories related to climate risk and finance. AfDB, ADB and the World Bank reported on climate change and finance-related events.

On climate finance news and developments, AfDB reported on the launch of a US$2.6 million project to promote renewable energy in Mali that will improve related policy frameworks and strengthen national capacity. The Climate Investment Funds’ (CIF) Scaling Up Renewable Energy in Low Income Countries Program (SREP) and the Sustainable Energy Fund for Africa (SEFA) are funding the project.

In the Caribbean, IDB will support efforts to enhance resilience to climate change through a US$10.39 million grant from the CIF Pilot Program for Climate Resilience (PPCR). The five-year programme aims to improve regional climate-relevant data management and to pilot and scale up innovative, climate-resilient initiatives in Jamaica, Haiti, Dominica, Grenada, Saint Lucia, and Saint Vincent and the Grenadines.

In Indonesia, the Adaptation Fund approved a four-year, US$6.0 million project that will aim to secure community livelihoods and food security against climate change impacts while addressing underlying anthropogenic drivers of land degradation. UNDP and the GEF launched, and will partly fund, a US$71.3 million project in Kazakhstan to support the identification, design and implementation of Nationally Appropriate Mitigation Actions (NAMAs) in the country’s urban sector.

The World Bank approved US$4.9 million in funding to the Kenya Climate Venture Facility, a private sector financing facility that will support start-up and early-stage firms developing renewable energy and climate technology businesses for the country. The Bank also announced additional financing for two projects: US$35 million for a stormwater management and climate change adaptation project in Dakar, Senegal; and US$2 million to Moldova’s Disaster and Climate Risk Management Project, which supports national severe weather forecasting and natural disaster response capacities.

APEC reported on the Assessments of Climate Change Impacts and Mapping of Vulnerability to Food Insecurity under Climate Change to Strengthen Household Food Security with Livelihoods’ Adaptation Approaches (AMICAF) project, funded by Japan and in collaboration with the Food and Agriculture Organization of the UN (FAO). The project has been implemented in the Philippines and Peru and will expand to two additional countries during the second phase of the project.

SLoCaT informed that Transport for London, the body responsible for the city’s transport network, issued a £400 million (US$596 million) 10-year green bond that will support the development of overground rail, the underground, station infrastructure, low emission hybrid buses and cycling improvements.

Canada’s Ministry of Public Safety and Emergency Preparedness launched a call for proposals under the CAD$200 million (US$165 million) National Disaster Mitigation Program, which will offer cost-sharing for flood prevention and mitigation projects in Canada’s provinces and territories.

In May, AfDB, EIB, IDB, ADB and the World Bank launched reports and studies, and published stories on, inter alia, climate risk management and resilience, black carbon finance and green growth bonds.

The ‘AfDB and the GEF 2014 Annual Report’ presents the joint portfolio, which in 2014 comprised 28 projects in 30 countries with a total value of US$218 million, and which has seen a tenfold growth over the past five years. The ‘ACCF Annual Report 2014′ provides information on the AfDB-sponsored Africa Climate Change Fund (ACCF) that was launched in 2014 with a US$4.725 million contribution from Germany.

EIB reported on its climate action project investments, totaling €19.1 billion in 2014 and €90 billion in the period from 2010-2014. Of the 2014 financing, €7.6 billion went to sustainable transport, €5.6 billion to renewable energy, €2.6 billion to research, development and innovation and €2.3 billion to energy efficiency.

IDB published a series of fact sheets examining sectoral climate change risk management options in Latin America and the Caribbean’s: urban infrastructure; water and sanitation; energy; agriculture; transportation; and tourism.

ADB published an article, together with two infographics and a video, on climate resilience and risk in Asian cities, stressing the need for integrated urban planning. The article notes that, unless action is taken, Asian cities may contribute more than half the rise in global greenhouse gas (GHG) emissions over the next two decades.

The World Bank released a publication that estimates the global value of carbon pricing in 2015 at nearly US$50 billion. According to ‘Carbon Pricing Watch 2015,’ an advance briefing from the ‘State and Trends of Carbon Pricing 2015′ report by the World Bank and Ecofys, this estimate includes US$34 billion in emissions trading systems and US$14 billion in existing carbon tax systems.

A report on black carbon finance, published by the Climate and Clean Air Coalition to Reduce Short-Lived Climate Pollutants (CCAC) Finance Initiative and led by the World Bank, identifies opportunities for action and presents strategies for achieving near-term results. The ‘Black Carbon Finance Study Group Report 2015′ concludes that “existing funds are already in a position to finance businesses, activities, technologies, and policies that will contribute to cutting black carbon emissions, and that several black carbon-rich sectors are sufficiently mature to absorb finance.”

The World Bank also reported on Viet Nam’s Climate Public Expenditure and Investment Review (CPEIR), released in May, which calls on the country to “develop a concrete action plan to bolster its efforts to ensure a climate-resilient future” and include “strategic investments toward a low-carbon future in its planning and budgeting strategy.”

A World Bank feature story examines Green Growth Bonds, green bonds with a return linked to an ethical equity index and designed to appeal to both large institutional investors and individual retail investors. To date, the Bank has launched 12 Green Growth Bonds in Europe, Asia and the US.

A high-level event titled ‘Climate Change: The Last Mile to Paris’ organized in Abidjan, Côte d’Ivoire, on 26 May, as part of the AfDB Annual Meetings, called for a “strong and universal climate change agreement with increased flows of funds, sufficient to fulfil Africa’s development aspiration.” At the first Africa Climate Resilient Infrastructure Summit (ACRIS I), which took place from 27-29 April in Addis Ababa, Ethiopia, AfDB showcased its Climate Safeguard System (CSS), which seeks to reduce climate vulnerability of infrastructure projects through project design stage upstream risk assessments.

Speaking at the ADB President’s Advisory Group Climate Change and Sustainable Development meeting on 15 May, ADB President Takehiko Nakao stressed 2015 as a crucial year for sustainable development and climate change. Nakao also explained how ADB is stepping up assistance to its Developing Member Countries (DMCs) to “close the financing gap for sustainable development and climate projects.”

The World Bank reported on two events: a Disaster Risk Financing and Insurance training event held in Tirana, Albania, on 5 May; and the Cannes Film Festival, in Cannes, France, where, on 21 May, film industry leaders announced their support for the Film4Climate commitment to reduce the environmental impact of film production and “tell stories about climate change” though cinema.