Martin Stadelmann and Timmons Roberts | February 26, 2015 11:08am
Today, the U.N. has published a “clarification note” where it explains that the actual number for North-South climate finance may be closer to the lower bound of the $40-175 billionmentionedin its“Biennial Assessment and Overview of Climate Finance Flows”report. That report, released at the U.N. negotiations in Lima, Peru in December, was a landmark in assessing climate finance flows, and a valuable effort to support discussions during this pivotal year for global climate politics.
This is an important clarification. According to our own estimates, the actual number for North-South climate finance is clearly closer to $40 than $175 billion. The upper bound of the original U.N. estimate relied on a private climate finance number ($27-123 billion) in our paper “Difficulties in accounting for private finance in international climate policy,” which actually refers to all private finance in the global south that is “mobilized by developed country governments”(e.g. through carbon markets or development banks)—not private finance flowing North-to-South. That is an important difference. Estimates for North-South flows both in our paper and the last two editions of Climate Policy Initiative’s Global Landscape of Climate Finance are much lower than the figures cited by the U.N. report (see Figure 1). Our own 2013 estimate for North-South private climate finance flows was $10-37 billion, comprising foreign direct investment for renewable energy, recycling, and environmental technology manufacturing.
If we take the $2-37 billion range for North-South private finance according to existing estimates (see Figure 1) and add the U.N. estimate of $35-50 billion for North-South public finance (see Figure 2), total North-South climate finance is somewhere between $37 billion and $87 billion, clearly closer to the lower bound of the U.N. estimate of $40-175 billion, and certainly less than half of the upper bound.