summary climate finance ccxg gf march 2014

Climate Change Expert Group www.oecd.org/env/cc/ccxg.htm

Co-facilitated by Georg Børsting, Tosi Mpanu Mpanu, Herman Sips, Suzanty

Sitorus

Climate finance replication and scaling

up – key points

CCXG Global Forum19 March 2014

2 Climate Change Expert Group

What is replication and scaling up?Scaling up and

replication crucial for real transformation

Different topics – may need to be addressed separately

Include the diversity of private sector actors

Replication and scaling up for adaptation may need a different recipe book than for mitigation


Mitigation and adaptation finance

International finance not balanced at present; replication risks repeating this imbalance

Projects have multiple aims; artificial divide between mitigation vs adaptation not helpful for replication and scaling up

Adaptation is case-specific; more likely to be replicated if intervention aligned into a larger programme/policy

Difficult to attract private adaptation finance if not directly related to core business interests, e.g. food industry and insurance


Modify to fit local contexts

Replication is not copying – need to modify to local conditions

It’s not just the finance – domestic enabling conditions key to moving to programme-level

Barriers include integrity of policies in the face of competing development objectives; translating commitment into actions that produce results


Multiple barriers existInformation and knowledge gaps

what works and what doesn’t (monitoring and evaluation – M&E- can help)

how to incentivise front runnersCapacity gaps in moving from planning to

implementation and in developing portfolios Multiple financing instruments (e.g. capital cost

reduction, Feed-in tariff) may be needed for projects that face multiple barriers and risks

Note that business cycles are much shorter than public climate funding approval processes


Information flow and M&E key…

To provide enough information about what has worked and what hasn’t … this can increase political will and potentially also climate finance delivery

Can also help to reduce risk and cost of project development (e.g. via improved resource surveys)

To help financial actors understand what the real key risks are

Information needs to be packaged so that it resonates with the business sector


… as are institutionsStrong institutional structure at a variety of

levels (national, sub-national) needed to plan, prioritise, implement climate finance interventions.

Support is needed for intervention by government

Good, ongoing, communication and teamwork between government and private sector also needed

Alignment of donors is crucial


What creates appetite from the private sector?

Enabling policy framework can help, whereas legislative uncertainty is a key barrier

Reduced risk, e.g. via developing risk mitigation instruments; allow flexibility in how risk is dealt with

Reduce high up-front capital costs – improve self-sustainability of intervention

Reduce delays in funding approval and disbursement (multilateral climate finance delivery can be slow)

Knowledge of domestic institutional structure Use programmatic rather than project approach

Climate Change Expert Group www.oecd.org/env/cc/ccxg.htm


Possible future workHow to scale up private climate finance for adaptation? Role that the 2015 agreement can play in enhancing the

enabling environment for climate financeHow to learn from Paris Declaration to improve country

ownership and donor co-ordination re climate finance mobilised as part of the 2015 agreement

How can M&E help to identify best practice for climate finance interventions

How can “adaptation contribution” be financed?How can a future climate agreement provide incentives

for enhanced climate-related finance and investment flows?

summary climate finance ccxg gf march 2014

Environment