The Standing Committee on Finance (SCF) hosted a side event today at COP24 to present the findings of the Summary and Recommendations on the 2018 biennial assessment and overview of climate finance flows.

“The Biennial Assessment tells us that climate finance to developing countries through bilateral channels, multilateral development banks and multilateral climate funds—when taken together—has clearly increased in 2015-2016. This is an encouraging and positive trend,” UNFCCC Executive Secretary Patricia Espinosa told participants.

“But it also tells us that we’re still far from where we should be. The fact remains that climate finance still represents only a very small fraction of overall finance flows,” she said.

A central finding is that climate finance to developing countries as reported in developed countries biennial reports to the UNFCCC increased by 24 per cent in 2015 to USD 33 billion and, subsequently, by 14 per cent in 2016 to USD 38 billion.

The report confirms that the bulk of climate finance continues to go towards efforts to curb greenhouse gas emissions. A relatively small proportion of finance goes towards efforts to enable the most vulnerable to adapt.

The growth in global climate finance seen in 2015 was largely driven by high levels of new private investment in renewable energy, the largest segment of the global total. The fall in renewable energy investment in 2016 was offset by an 8% increase in investment in energy efficiency.

The report also finds that renewable energy subsidies are rising but observes that global investment in fossil fuel and fossil fuel subsidies remains considerably higher.

Noting various gaps and weaknesses in data collection and methodologies, the report recommends several ways that the tracking and reporting of financial data could be enhanced. It also calls on Parties to align climate finance with national climate change frameworks and priorities.

Other key findings relate to the efforts of Multilateral Development Banks to continue scaling up climate finance flows. This point was demonstrated yesterday when Multilateral Development Banks (MDBs) announced a joint framework for aligning their activities with the goals of the Paris Agreement. The Banks committed to working together in six key areas considered central to meeting the temperature goals of the Agreement.

In addition, the World Bank pledged $200 billion in climate action funding for 2021-2025, thus doubling its current five-year investment plans while placing a greater emphasis on adaptation and resilience.