CLIMATE FINANCE

5th Biennial Assessment and Overview of Climate Finance Flow (BA), showing the geographical and thematic balance of finance flows.

Domestic Climate-Related Public Investment

In total, available estimates on domestic public expenditures on climate change in 2019-2020 amount to approximately USD 134.2 billion per year.

Further information is available in Chapter 2.3 of the fifth BA technical report.

Renewable Energy

Investment in new renewable energy reached an average of 336 billion over 2019-20, close to record highs even while technology costs continued to decrease and the disruption of the coronavirus pandemic in 2019.

Further information is available in Chapter 2.2.3 of the fifth BA technical report.

Sustainable Transport

Sustainable transport investments reached USD 169 billion on average in 2019-2020, a 20% increase compared to the 2017-2018 period. Investments continued to be driven by a strong expansion in EVs and associated charging infrastructure.

Further information is available in Chapter 2.2.4 of the fifth BA technical report.

Buildings and ISustainable Transportnfrastructure

Energy efficiency investments in buildings and infrastructure increased by 25% compared to the previous period and averaged USD 170 billion in 2019-2020.

Further information is available in Chapter 2.2.5 of the fifth BA technical report.

Industry

Energy efficiency and decarbonization investments in industry sectors, reached an annual average of USD 40 billion in 2019-2020.

Further information is available in Chapter 2.2.6 of the fifth BA technical report.

Other Sectors - Mitigation

Average annual investment for climate change mitigation activities in other sectors agriculture, forestry and land use as well as water and waste amounted to USD 29.7 over 2019-2020.

Further information is available in Chapter 2.2.7 and 2.2.8 of the fifth BA technical report.

Adaptation Public Finance

Public adaptation finance averaged USD 49.3 billion per year, increasing by 65% compared to 2017-2018 estimates.

Further information is available in Chapter 2.2.9 of the fifth BA technical report.

Both Mitigaiton and Adaptation

Cross-cutting investments contributing to both climate change mitigation and adaptation were estimated at USD 17.3 billion per year.

Mobilized Private Climate Finance Through Multilateral Channels

Private climate finance mobilized by multilateral climate funds and MDBs was estimated at USD 8.3 billion on average over 2019-2020.

Further information available in Chapter 2.5.4 of the fifth BA technical report.

MDB Climate Finance Attributed To Developed Countries (b)

The attribution to developed countries of MDB climate finance flows is calculated at USD 30.5 billion in 2019 and 33.2 billion in 2020.

Further information available in Chapter 2.5.2 of the fifth BA technical report.

Climate-Specific Finance Through Bilateral Regional and Other Channels

Climate-specific financial support through bilateral, regional and other channels reported on a preliminary basis by 23 Annex II Parties reached an annual average of USD 40.1 billion in 2019–2020, an increase of 6 per cent on the 2017-2018 period.

Further information available in Chapter 2.5.1 of the fifth BA technical report.

Multilateral Climate Funds
(including UNFCCC)

UNFCCC funds and Multilateral Climate Funds approved USD 2.9 billion and USD 3.5 billion for climate finance projects in 2019-2020, respectively. The annual average of USD 3.2 billion represents an increase of 21 per cent over the 2017–2018 average.

Further information available in Chapter 2.5.2 of the fifth BA technical report.

Other Private Finance Projects

CPI estimates other private investment flows from developed to developing countries amounted to 7.3 billion in 2019 and USD 9.6 billion in 2020, particularly in the energy sector for projects concerning power and heat generation.

Further information available in Chapter 2.5.4 of the fifth BA technical report.

Mobilized Private Climate Finance Through Bilateral Regional Institutions

Mobilized private climate finance through bilateral and regional development finance institutions amounted to USD 5.8 billion in 2019 and USD 5.1 billion in 2020.

Further information available in Chapter 2.5.4 of the fifth BA technical report.

References

How to plan and finance action on Climate Change
Fifth Biennial Assessment and Overview

Climate action requires significant financial investments by governments and businesses, such as new energy systems and infrastructure as well as climate-resilient seeds that can withstand the impacts of climate change. Climate inaction is vastly more expensive.

Types of Funding

1. Public funding, provided by governments (and taxpayers), is essential to finance actions for which private funding does not yet exist or would not normally attract private funding like for investments that contribute to a public good such as reinforcing the banks of a river to reduce the risk of flooding in risk area.
2. Private financing is used for investing in projects that are critical to the new green economy such as renewable energy power plants or electric cars.

Many developing countries lack the resources and technology to do so. Therefore, all countries agreed that developed nations with money and technological know-how must increase their financial support for climate action in developing countries, especially the poorest and most vulnerable.

One critical step is for industrialized countries to fulfil their commitment of the Paris Agreement to provide $100 billion annually to developing countries so they can adapt mitigate and move towards greener economies. International cooperation is essential to addressing climate change .

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CLIMATE FINANCE

5th Biennial Assessment and Overview of Climate Finance Flow (BA), showing the geographical and thematic balance of finance flows.

Domestic Climate-Related Public Investment

Renewable Energy

Sustainable Transport

Buildings and ISustainable Transportnfrastructure

Industry

Other Sectors - Mitigation

Adaptation Public Finance

Both Mitigaiton and Adaptation

Mobilized Private Climate Finance Through Multilateral Channels

MDB Climate Finance Attributed To Developed Countries (b)

Climate-Specific Finance Through Bilateral Regional and Other Channels

Multilateral Climate Funds(including UNFCCC)

Other Private Finance Projects

Mobilized Private Climate Finance Through Bilateral Regional Institutions

References

Multilateral Climate Funds
(including UNFCCC)