[Individual articles from the Summer 2017 issue of Intersections will be posted on this blog each week. The full issue can be found on MCC’s website.]
The greatest suffering from climate change impacts is being felt by those who already feel the most need—and who are the least equipped to respond effectively. These vulnerable communities are also the least responsible for causing climate change. Wealthy nations, including the United States, bear the greatest responsibility for climate change and therefore have a moral obligation to repair the damage and help communities adapt to new realities. In recognition of this moral obligation, MCC and other faith-based organizations have advocated strongly for increased U.S. government funding for international programs to help low-income communities adapt to the impact of climate change.
Unfortunately, the current U.S. administration has not only promised to halt funding for international adaptation efforts, but recently announced it would pull the U.S. out of the Paris accord, an international agreement on climate change mitigation and adaptation formulated within the United Nations Framework Convention on Climate Change (UNFCCC) and signed by all but two of the world’s countries.
Working with faith-based partners in Washington, D.C., MCC staff advocate directly to U.S. government officials and also work to educate constituents on the need for adaptation assistance, encouraging them to advocate to their members of Congress. In recent years, much of this advocacy has focused on the Green Climate Fund (GCF). In 2014, the U.S. pledged $3 billion to the GCF, but, in every year since, it has been an uphill struggle to secure congressional approval for these funds. Meanwhile, although the faith community has continued to support the GCF, a growing tension has emerged within faith-based climate change advocacy efforts between advocating for continued funding and at the same time criticizing the fund’s shortcomings.
The Green Climate Fund was created in 2010 by the UNFCCC. Currently one of several existing mechanisms for multilateral financing for climate-related projects, the GCF is expected to become the main mechanism for such financing in future years. The GCF is not an agency of the United Nations, but is a legally independent institution accountable to the UNFCCC. The fund is intended to be part of a paradigm-shifting, transformative response to climate change, implementing a country-driven, gender-sensitive approach to mitigation and adaptation.
The GCF board consists of 24 members with equal representation from “developed and developing countries.” Two civil society and two private sector representatives serve as non-voting observers to board meetings. The GCF funds projects for mitigation and adaptation efforts as well as for technology transfer and capacity building. Projects are funded through grants and concessional loans from the GCF, often in combination with local public or private sector funding. The World Bank is the interim trustee for the GCF until a permanent trustee is selected through an open, competitive process.
An initial fundraising campaign collected pledges for the GCF from 37 countries totaling $10.2 billion. Funds allocated for the GCF are intended to be new financing rather than the repurposing of funds from existing development assistance programs. By 2015, the GCF had received signed contributions for more than 50 percent of pledges, reaching a benchmark to enable the fund to begin approving projects.
GCF projects focus on a variety of mitigation and adaptation efforts, including efforts to develop renewable energy, improve energy efficiency, strengthen resilience to climate change impacts and protect sustainable livelihoods. All developing country members of the UNFCCC are eligible to receive GCF funds. Funding comes through accredited entities which can include national or regional development banks, government ministries, nongovernmental organizations and other national or regional organizations that meet accreditation standards.
At the end of 2015, the GCF approved its first eight projects totaling $169 million, including an energy efficiency green bond in Latin America and an early warning system for climate-linked disasters in Malawi. In 2016, the board approved an additional $1.3 billion worth of funding, including a $166 million food security and resilience project in India for solar micro-irrigation in the vulnerable tribal areas of Odisha and a $232 million hydropower project in the Solomon Islands.
In many ways, the stated goals of the GCF align well, at least in theory, with MCC goals in areas such as stakeholder engagement, gender sensitivity, local capacity building and reaching the most vulnerable. In reality, however, GCF board members and advocates have raised concerns about safeguards, consultation and transparency.
In 2015, the GCF came under intense pressure to start funding projects but, at the same time, the board was still in the process of developing policies and procedures. One board member commented: “We are building the plane as we fly the plane.” The continued rush to keep funds flowing means that even board members complain that they do not have adequate information to assess individual projects. Civil society representatives have raised objections about some accredited funding entities (most of which are multilateral and bilateral development agencies), noting links to the fossil fuel industry, financial mismanagement and human rights abuses.
The GCF is currently using the International Finance Corporation’s social and environmental safeguards until it develops its own. These standards incorporate some good elements, but lack a strong standard for local consultation and consent and contain insufficient protections for the rights of indigenous peoples as well as for national habitats and biodiversity. In 2015, a wetlands restoration project in Peru came under criticism due to concerns over whether indigenous communities had been properly consulted. Doubts persist about the adequacy of consultation with local communities and the transparency of the project approval process.
Other concerns have involved the need for more capacity building for local institutions, the process for considering high-risk projects, the benefits of large versus smaller-scale projects, the level and types of co-funding with the private sector, definitions of adaptation and mitigation and the use of grants versus loans.
The GCF continues to work to address concerns. Internal capacity issues plagued the fund early on, but it has since significantly increased staff capacity. This expanded staffing has allowed the fund to make initial improvements in communications and transparency. The GCF is currently developing its own environmental and social safeguards and has committed to the development of an indigenous peoples policy.
The board continues to discuss how to provide more funding for building capacity at the local level. Additionally, national development agencies, such as the U.S. Agency for International Development (USAID), have begun to reorient some funding to reinforce GCF capacity building efforts.
Going forward, U.S. government participation in funding and shaping the GCF is in doubt, particularly in light of the impending U.S. withdrawal from the Paris Agreement. Total U.S. contributions to the fund thus far total $1 billion. The current administration, however, has stated it will not fulfill the remaining $2 billion of the U.S. pledge. Until now, advocates for U.S. funding of the GCF have maintained good dialogue with the U.S. representative on the GCF board, but it is unclear whether this access will continue. MCC and its partners will continue to push for positive changes using any avenues available, including dialogue with the non-voting civil society representatives to the board.
Though the GCF very much remains a work in progress, there is space for advocacy to call the Green Climate Fund into being what it was envisioned to be—a much-needed tool for helping vulnerable communities adapt to our changing climate.
Tammy Alexander is senior legislative associate for domestic affairs in the MCC U.S. Washington Office.
Amerasinghe, Niranjali, Joe Thwaites, Gaia Larsen, and Athena Ballesteros. The Future of the Funds: Exploring the Architecture of Multilateral Climate Finance. Washington, D.C.: World Resources Institute, 2017. Available at http://www.wri.org//sites/default/files/The_Future_of_the_Funds_0.pdf.
GCF 101: A Comprehensive Guide on How to Access the Green Climate Fund. Available at greenclimate.fund/gcf101. Green Climate Fund: Projects. Available at http://www.greenclimate.fund/projects/browse-projects.
Green Climate Fund: Projects. Available at http://www.greenclimate.fund/projects/browse-projects.
Schalatek, L., Nakhooda, S. and Watson, C. Overseas Development Institute. The Green Climate Fund. In Climate Finance Fundamentals 11 (December 2015). Available at http://www.climatefundsupdate.org/listing/green-climate-fund.
Additional resources on U.S. environmental policy available at https://washingtonmemo.org/environment./
National Congress of American Indians on the impact of climate change on indigenous communities. Available at http://www.ncai.org/policy-issues/land-natural-resources/climate-change.