Selecting effective financial instruments to support action on climate change
This guide presents a curated selection of resources on finance for Nationally Determined Contributions (NDCs) and Long-term Strategies (LTS). It is designed to help Global Climate Action Partnership practitioners find high-quality resources that meet their specific needs, avoiding time-consuming searches on the internet. It will be useful to individuals working on, or interested in, NDC and LTS finance in both developed and developing countries.
- 1. Understanding the situation
- 1.1 Understanding current flows
- 1.2 Assessing financing needs
- 1.3 Assessing capacity
- 1.4 Identifying and overcoming barriers
- 2. Planning and coordinating
- 2.1 Institutions and governance
- 2.2 National finance strategies
- 2.3 Investment plans
- 2.4 National climate funds
- 2.5 Green investment banks
- 4. Using public finance
- 4.1 Managing national finance
- 4.2 International climate finance
- 4.3 Climate finance readiness
- 4.4 The Green Climate Fund
- 4.5 Direct access
- 5. Designing financial instruments
- 5.1 General resources
- 5.2 Sources of private finance
- 5.3 Risk mitigation
- 5.4 Guarantees
- 5.5 Feed-in tariffs and auctions
- 5.6 Taxes and tax incentives
- 5.7 Carbon pricing
4.4 The Green Climate Fund
The Green Climate Fund is the newest actor and the largest multilateral fund in the climate finance architecture. It became fully operational in 2015. Its initial resource mobilization led to over US$10 billion being pledged, and it is expected to be the principal channel through which climate finance flows from developed to developing countries. As such it is currently of great interest to developing countries as a source of finance for their mitigation and adaptation projects (and this is why it features its own section in this guide, unlike other funds). The resources and links here provide introductory information on how the Green Climate Fund works.
This toolkit aims to help private sector entities understand the key considerations and to fulfill the Fund’s requirements when developing proposals for the Green Climate Fund. It was developed for Bangladesh, but nearly all of the content is also relevant to other countries. The guide covers the essential details of the Green Climate Fund, its project cycle, proposal template, and key project development requirements, and provides guidance on how to get started.
This briefing provides a snapshot of the operationalization and functions of the Green Climate Fund at that point. It provides a useful overview of the Fund’s history and a high level overview of some key aspects of how the Fund works, including its results frameworks, financial instruments used, country ownership, access modalities, accreditation framework, and readiness support. A list of all projects approved at the time of publication is included.
The GCF produced this guide to act as a simple, comprehensive road map for anybody who would like to access the financial resources of the Fund. The guide addresses the different funding opportunities the Fund provides and is structured in four sections: ‘Empowering Countries’ (which covers the Readiness Support the GCF provides to help countries prepare to access the Fund); ‘Getting Accredited’ (which describes how the GCF channels its funding via Accredited Entities, and how to become one); Funding Projects (the process of preparing projects and submitting them for evaluation by the Fund); and ‘Implementing Projects’ (which covers the legal and monitoring arrangements necessary for project implementation). Each of these sections provides a simple overview, a step by step guide on how to apply, and a set of frequently asked questions. Links to more detailed documents and templates are provided throughout the guide.
For further information on direct access see 4.5.
These pages provide summary information about the focus, impact, funding, and key partners of approved Green Climate Fund projects, as well as providing links to documents such as the original funding proposals.