Ballesteros: What Counts as New Climate Financing?

Establishing a common reporting system to track “new and additional” climate financing pledged at the Copenhagen summit should be the agenda in Cancun, Mexico. The United Nations Framework Convention on Climate Change can help advance this plan, an expert says.

“The immediate next step is to secure a decision at COP16 in Cancun, Mexico that mandates a relevant body under the Convention to formulate draft guidelines for reporting financial information in a comparable, transparent, complete, accurate and efficient way,” according to Athena Ballesteros, a senior associate at the World Resources Institute.

WRI estimates that some USD31.32 billion has so far been pledged as part of the Copenhagen commitment to “provide new and additional resources, including forestry and investments through international institutions, approaching USD30 billion for the period 2010–2012.” However, the nature and way of channeling these funds remain in up in the air.

“Some of the funds have yet to go through national budget appropriations processes,” Ballesteros wrote in a World Bank blog. “A number of pledges are often restated or renamed commitments made in the past, but with some added resources.”

Ballesteros argued that “new and additional” financing must ensure an increase in climate money relative to previous and not involve redirection of financing.

“To date, Parties to the [UNFCCC] have yet to achieve consensus on a clear and specific definition of additionality that can be applied uniformly to developed country financial pledges. As a result, countries have proposed various methods for defining additionality of their fast-start finance,” she said.

Furthermore, countries are proceeding with specifying what portion of their climate financing will be used for mitigation, as well as adaptation measures, Ballesteros said, citing the European Union as an example, which intends to earmark 63 percent of its 2.39 billion-euro (USD2.9 billion) climate aid in 2010 for mitigation while the remaining 37 percent will back adaptation measures.

“The need for greater attention to adaptation fast-start funds should be addressed if we want a strong focus on building institutional and technical capacity in national-level decision-making processes that are inclusive, transparent, and accountable and ensure participation,” the WRI expert said.

About the author

  • Ma. Rizza Leonzon

    As a former staff writer, Rizza focused mainly on business coverage, including key donors such as the Asian Development Bank and AusAID.