Counting the Cash: Fast Start Financing and the Future of Climate Finance Maria Athena Ronquillo-Ballesteros Institutions and Governance Program World Resources Institute September 2010
Global Goal Mitigation Technology Finance Capacity building SHARED VISION Developed country Commitments MRV Adaptation Forests Developing Country Actions UNFCCC goal: prevent "dangerous" human interference with the climate system Requires an ambitious and functional agreement MRV is a key process to support the multiple components of an agreement
MRV Functions and Outcomes You can t manage what you can t measure Functions Measure climate financial flows Report flows internationally Verify accuracy of reported data Outcomes Trust Recognition Accountability Increased ambition Sharing best practices Increased national capacity to monitor
One CSO effort to track FSF http://www.wri.org/stories/2010/02/summar y-developed-country-fast-start-climatefinance-pledges
Criteria to Assess the Pledges Program priorities: a balanced allocation between adaptation and mitigation and including forestry Eligibility criteria: Adaptation funding prioritized for the most vulnerable developing countries Channels: Includes investments through international institutions Sources: Is new and additional
Balanced Allocation? EU (2010): 63% mitigation, 37% adaptation Denmark (2010): 52% mitigation, 48% adaptation & capacity building Germany: ~1/3 for adaptation, 350 for REDD, the remainder for energyrelated mitigation France: 20% for REDD+ Japan: $5.1 billion for mitigation, $165 million for REDD+, $225 million for Adaptation
Aggregating the Fast-Start Pledge Total Annual Pledges $10.25bn $9.78bn $7.88bn Total 2010-2012 Pledge: $27.9 billion 2010 2011 2012 15 countries have specified their individual pledge
Which Channels? A significant portion of the funds will flow through bilateral channels Dominant multilateral channels of choice: CIFs & the GEF Accountability: Standards and systems that ensure power is exercised responsibly Power: Formal and informal distribution of the capacity to determine outcomes The governance of the funds has implications for the effectiveness and perceived legitimacy. Responsibility: Exercise of power for its intended purpose
What counts matters 30.0 25.0 20.0 15.0 10.0 5.0 0.0
Is it New and Additional? New New sources? Increases over previous years? Additional As compared to ODA? As compared to ODA targets? As distinct from ODA? Each party is using its own approach to defining new and additional.
What have we learned so far? Countries are putting forward individual fast start finance pledges, so progress being made But many questions still remain Review of the data Reporting nuanced information Recipient country reporting/ double booking Tracking and monitoring is currently difficult Need greater transparency and an agreed, common reporting/mrv processes An MRV role for civil society MRV of the spending an effectiveness question
Going beyond FSF: Long term tracking climate finance Climate financial flows include: North-South public flows Private finance South-South flows Domestic finance in developing countries Principles : Complete Transparent Comparable Accurate Efficient
Conclusions Current reporting lacks transparency, completeness, comparability, efficiency and accuracy Parties could make improvements by adopting new reporting guidelines (key step for Cancun and beyond) A new reporting format prompts considerations for the redesign of the review process and the institutions involved in the MRV process Institutions tasked to channel and administer FSF need to address legitimacy issues Need to enhance the role of National Implementing Agencies/Entities Build up Citizens MRV of climate finance effectiveness
More Information See our publications at www.wri.org: Summary of Developed Country Fast-Start Climate Finance Pledges Guidelines for Reporting Information on Climate Finance Power, Responsibility and Accountability: Re-Thinking the Legitimacy of Institutions for Climate Finance Counting the Cash: Elements of a Framework for the Measurement, Reporting and Verification of Climate Finance