Former Secretary of State, Hilliary Clinton was instrumental in getting developed countries to promise 100 $ billion in climate finance in Durban in 2011. Since that breakthrough, climate finance has always been a major point of indecisiveness at Conference of Parties (COP). It has historically been the last item in which brackets (a sign of disagreement) is resolved.
This years’ COP at Katowice was an opportunity to set the ambitions higher. And in the process enable developing countries to raise their emission reductions.

In the latest report by the Standing Committee of Finance to the UNFCCC estimated $55 billion in climate finance was raised by developed countries in 2016. This is 55 % of the 2020 target. The report also noted that only 25% of the 55 billion went towards adaptation, while the majority went towards mitigation in the form of renewable energy projects. Interestingly, renewable energy is a field where developing countries have already set up ambitious targets. In doing so, we lost an opportunity to increase focus on adaptation activities and enable LDCs to adapt to a 1.5 degree world.

The latest IPCC report had a powerful message in this regard – that it is time to focus on both mitigation and adaptation. And that there are potent synergies in both.Going by the latest publicly available draft of the final text (at the time this blog was published), the parties did not agree on a long-term vision of climate finance post-2020. The parties also did not agree on raising ambition on climate finance. The phrase on “new and additional” funding is still in brackets.

Additionally, the definition of a financial instrument has been expanded to include grant, concessional loan, non-concessional loan, equity, guarantee, insurance and other. This dilutes commitment of national governments even further as more private finance can now be counted under climate finance.

However, there was some good news. Most of adaptation activities are funded through World Bank Group’s Adaptation Fund . In 2017, $96 Million was pledged by developed countries towards this fund – representing 5% of all climate finance. At the COP, new funding commitments were made, raising this pledge to approximately $129 Million. However, the conversation lacks a credible estimate of adaption finance requirements.

Whether Katowice is a success or not will depend if parties can agree to climate finance provisions.