Why we should kill the Green Climate Fund

It's not more climate organisations we need. It's more effective ones

Share
Related Topics

Some three hundred government officials, representatives of think thanks, civil society and the private sector recently gathered at the regal Paris headquarters of France’s Ministry of Finance for three days. They were there to continue down the rocky road of launching a UN institution, the Green Climate Fund (GCF), intended to mysteriously collect, then spend $100 billion a year on climate change efforts worldwide. 

The GCF has been four years in the making yet I heard at its Paris meeting that it still doesn’t know what it actually does.  But climate action cannot wait:  According to the World Bank, the earth is set to warm by 4 degrees and according to the International Energy Agency, we need $1 trillion a year between 2012 and 2050 to finance a low-emissions transition.  Compared to a global GDP of $70 trillion and to our current spending of $2 trillion per year on fossil fuel subsidies, $100 billion is peanuts, yet you wouldn’t be able to tell by attending the GCF meetings. 

The problem? The GCF joins a cacophony of parallel climate support vehicles, including the Global Environment Facility (GEF), the Climate Investment Funds (CIF), the World Bank Group, the UN climate talks Adaptation Fund and another thirty five organizations listed as “UN partners on climate change,” none of which are decisively tackling climate risks.  

A case in point: The UN climate talks set up an Adaptation Fund for the same purpose as the GCF, but it was let down by a lack of ambition when its funding dried up after the Kyoto Protocol’s Clean Development Mechanism (or CDM) was neglected because it wasn’t the “new thing”.  The same people pop up at the GCF, at the UN climate talks and at related meetings, so it would have been simple enough to spend the four years correcting the course we were on through increased ambition. 

Furthermore, the record of existing institutions isn’t comforting.  The GEF currently invests $800 million (0.8% of $100 billion) a year in climate change.  The CIF, doing pretty much the same thing as the GEF, disbursed a total of $343 million this year (0.34% of $100 billion).  The World Bank lent $12.2 billion in climate change funding in 2012 (12% of $100 billion).  

Trying to mobilise an additional $100 billion through a brand new international institution is neither wise, nor conducive to results. What’s needed is the courage to kill the Green Climate Fund and the leadership to get climate action decisively underway.

The GCF should be merged with one or more of the GEF, the CIF and the Adaptation Fund.  This would allow the effective use of existing resources and procedures.  The GEF and the CIF are not accountable to the UN climate talks (whereas the Adaptation Fund is), but this can be easily fixed to address concerns of developing countries that wealthier members have too much influence.  Collectively, these could form an effective “Climate Change Action Bank” able to mobilize $100 billion a year or more.  Here’s how. 

First, developing countries on the front lines of suffering from climate change – China and India - backed by oil producing countries and others, would lead the funding via direct contributions from their national budgets.  Importantly, this would greatly increase pressure on developed economies to at least match the developing world.  In addition, as should be very clear by now to developing countries’ negotiators at the UN climate talks, developed economies won’t stump up the necessary cash otherwise.  This is not in fact a big ask:  a recent study by the Climate Policy Initiative shows that 76% of all climate financing already comes from the country it is spent in. 

Second, the Adaptation Fund could be replenished were serious efforts made to fix the sputtering Clean Development Mechanism; a UN scheme to encourage private sector investment in clean energy projects a levy on which finances the fund.  Private sector investment through the CDM has all but dried up because of a nosedive in the value of the carbon credits around which the system is based; were a stable price set for these credits, private sector money would start flowing again. At one stage the CDM had unleashed more than $356 billion in green investments and was on track to deliver $1 trillion in financing – a level of private sector investment in climate spending which has never been paralleled. Restoring this level of investment, along with a gradually increasing levy, could provide the Adaptation Fund with $10 billion per year from the private sector (which the CPI study shows was responsible for 62% of global climate spending in 2012). 

Third, the existing funding of the merged institutions (i.e. the Climate Change Action Bank) should be supplemented by one or more of a range of financing tools.  For example, they would regulate a carbon tax paid by polluters on the $2 trillion of fossil fuel subsidies they receive, or emissions from shipping and aviation via levies or the sale of allowances.

The responsible outcome of November’s UN climate talks in Warsaw is to ensure that we can immediately finance climate mitigation and adaptation. Courage and leadership: Enter, stage right.

React Now

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
iJobs Job Widget
iJobs General

Recruitment Genius: Finance Director

£65000 - £80000 per annum: Recruitment Genius: Finance Director required to jo...

Recruitment Genius: Medico-Legal Assistant

£15000 - £25000 per annum: Recruitment Genius: This is a unique opportunity fo...

Ashdown Group: (PHP / Python) - Global Media firm

£50000 per annum + 26 days holiday,pension: Ashdown Group: A highly successful...

The Jenrick Group: Quality Inspector

£27000 per annum + pension + holidays: The Jenrick Group: A Quality Technician...

Day In a Page

Read Next
David Cameron faces the press as he arrives in Brussels for the EU leaders summit on Thursday reuters  

On the Tusk of a dilemma: Cameron's latest EU renegotiation foe

Andrew Grice
John Profumo and his wife Valerie Robson in 1959  

Stephen Ward’s trial was disgraceful. There can be no justification for it

Geoffrey Robertson QC
Homeless Veterans appeal: 'You look for someone who's an inspiration and try to be like them'

Homeless Veterans appeal

In 2010, Sgt Gary Jamieson stepped on an IED in Afghanistan and lost his legs and an arm. He reveals what, and who, helped him to make a remarkable recovery
Could cannabis oil reverse the effects of cancer?

Could cannabis oil reverse effects of cancer?

As a film following six patients receiving the controversial treatment is released, Kate Hilpern uncovers a very slippery issue
The Interview movie review: You can't see Seth Rogen and James Franco's Kim Jong Un assassination film, but you can read about it here

The Interview movie review

You can't see Seth Rogen and James Franco's Kim Jong Un assassination film, but you can read about it here
Serial mania has propelled podcasts into the cultural mainstream

How podcasts became mainstream

People have consumed gripping armchair investigation Serial with a relish typically reserved for box-set binges
Jesus Christ has become an unlikely pin-up for hipster marketing companies

Jesus Christ has become an unlikely pin-up

Kevin Lee Light, aka "Jesus", is the newest client of creative agency Mother while rival agency Anomaly has launched Sexy Jesus, depicting the Messiah in a series of Athena-style poses
Rosetta space mission voted most important scientific breakthrough of 2014

A memorable year for science – if not for mice

The most important scientific breakthroughs of 2014
Christmas cocktails to make you merry: From eggnog to Brown Betty and Rum Bumpo

Christmas cocktails to make you merry

Mulled wine is an essential seasonal treat. But now drinkers are rediscovering other traditional festive tipples. Angela Clutton raises a glass to Christmas cocktails
5 best activity trackers

Fitness technology: 5 best activity trackers

Up the ante in your regimen and change the habits of a lifetime with this wearable tech
Paul Scholes column: It's a little-known fact, but I have played one of the seven dwarves

Paul Scholes column

It's a little-known fact, but I have played one of the seven dwarves
Fifa's travelling circus once again steals limelight from real stars

Fifa's travelling circus once again steals limelight from real stars

Club World Cup kicked into the long grass by the continued farce surrounding Blatter, Garcia, Russia and Qatar
Frank Warren column: 2014 – boxing is back and winning new fans

Frank Warren: Boxing is back and winning new fans

2014 proves it's now one of sport's biggest hitters again
Jeb Bush vs Hillary Clinton: The power dynamics of the two first families

Jeb Bush vs Hillary Clinton

Karen Tumulty explores the power dynamics of the two first families
Stockholm is rivalling Silicon Valley with a hotbed of technology start-ups

Stockholm is rivalling Silicon Valley

The Swedish capital is home to two of the most popular video games in the world, as well as thousands of technology start-ups worth hundreds of millions of pounds – and it's all happened since 2009
Did Japanese workers really get their symbols mixed up and display Santa on a crucifix?

Crucified Santa: Urban myth refuses to die

The story goes that Japanese store workers created a life-size effigy of a smiling "Father Kurisumasu" attached to a facsimile of Our Lord's final instrument of torture
Jennifer Saunders and Kate Moss join David Walliams on set for TV adaptation of The Boy in the Dress

The Boy in the Dress: On set with the stars

Walliams' story about a boy who goes to school in a dress will be shown this Christmas