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The only “secure” line of finance into the UNFCCC adaptation fund is a 2% share of proceeds of carbon credits generated by the CDM. At COP 18 in Doha, this was extended to also include transfer of credits from Joint Implementation and under International Emission Trading. The problem is that the price of these credits is now so low now that they hardly attracts any investment in mitigation, which directly translates to very low levels of funding for the adaptation fund from these sources.
Hi everyone, I'm Daisy Streatfeild and I'm a senior advisor on international climate finance for the UK government. Looking forward to the discussion and responding to your questions #climatefinance
Welcome, everyone, to our live online debate: All that Glitters - What's next for Climate Finance? Our experts are now ready to take your questions, so let's get the conversation going! Feel free to address your question to a particular expert if you'd like. You can also send in questions via Twitter hashtag #climatefinance
@MizanRKhan: Please feel free to post a question
Hi there, I'm Smita Nakhooda, and work on international climate finance at ODI. I look forward to the debate.
Niclas, what do you think should be done about this low level of CDM money now going to the Adaptation Fund? The fund is looking at other ways of raising money, I know, but not much progress so far...
Smita and Daisy, how about this issue of how much of the money should come from public versus private finance? Is there a way to get private money interested in adaptation?
To Simon Maxwell: The average estimate is that at least half of the US$ 100 billion will have to come from the private sector. So less than half from public sources. BUT the public can/should still enable the private sector to direct investments in to CC
Hi @Maridupar, donors will report on their final Fast Start figures in May so we should know what the final Fast Start total is then, but it’s encouraging that reports at Doha indicate that donors have delivered $33bn – exceeding the Fast Start goal which demonstrates donors commitment to provide climate finance #climatefinance
Seems to me that rising losses from extreme weather - particularly floods, like those that hit Thai factories not so long ago - would be a pretty good argument for the private sector investing in adaptation (or at least flood walls, etc.) out of self interest
To Megan Rowlings question: The low income from CDM to the adaptation fund is a result of low offset prices. That can best be fixed by parties increasing mitigation ambition’, creating more demand for offsets, and make more use of CDM as a finance instrument to support mitigation in developing countries.
Hi Qamrul, the UK will continue to provide scaled up climate finance after Fast Start. Our £2.9bn International Climate Fund is a four year budget April 2011-March 2015. This means around £1.8bn for the 2013-2015 period. We're aiming for 50% of this to be for adaptation, focused on the poorest and most vulnerable countries. #climatefinance
To Robertmwaren’s question about, how to draw the line between what counts as adaptation vs mitigation (Is this a line worth drawing at all? #climatefinance).
Good question!! In some cases the on-the-ground action will contribute to both mitigation and adaptation. One possible model is to NOT make that distinction but ask the end users of finance decide their priorities themselves, but it is equally plausible that donors will put requirements on how to use the funding. I think this is the norm today.
@Maridupar The difficulty with counting the FSF funds is that, by Oxfam's analysis, only about 1/3 of the $30+ billion globally was 'new' funds beyond already committed ODA or climate funds. Part of the issue is that in many cases existing ODA streams were used as climate finance. We're all for integrating climate into other development areas (e.g. food, water, etc.), but how to count it is still a real issue.
David Waskow at Oxfam.