Financing Climate Change Adaptation and Mitigation

Three special funds serving for funding measures related to climate change mitigation and adaptation were established in the framework of the Convention and the Kyoto Protocol:

The Special Climate Change Fund was created in 2001 in order to fund adaptation planning, technology transfer and capacity building in all developing countries. Criteria for funding include that projects are country-driven, based on national priorities. The fund is operated by the Global Environment Facility (GEF).

The Least Developed Countries Fund (LCDF) supports the preparation of National Plans for Adaptation (NAPAs) in Least Developed Countries (LCD), but currently does not cover the cost of implementation of adaptation measures. Like the Special Climate Change Fund it is operated by the GEF. Both funds are established under the UNFCCC and rely on voluntary contributions for funding.

Established under the Kyoto Protocol, the Adaptation Fund is orientated towards concrete adaptation programs and projects in developing countries that are parties to the Kyoto Protocol. It is generated by a 2% levy on carbon credits from CDM projects. It is operated by the Adaptation Fund Board and served by the GEF (secretariat) and the World Bank (trustee).

Additionally, the GEF is providing funding for mitigation (mainly renewable energy, energy efficiency, and sustainable transportation) and adaptation projects in developing countries and countries in transition. "GEF’s current strategy for its climate change projects focuses on removing barriers and building capacity in the areas of policies, financing, technology, business infrastructure, and information." (GEF’s work on global climate change, July 2006)

There is a close connection between financing mitigation and adaptation and the carbon market. For example, the adaptation fund is generated by a 2% levy on CDM projects. Mitigation strategies are relying on instruments like CDM and Emissions Trading. Read more about market based climate change mechanisms.

Gender Dimension

Because of their particular vulnerabilities, and due to the gendered roles in all societies, women may have different needs for adaptation than men. Although there is no gender analysis of current climate change funds available, some research indicates that they hardly meet the particular needs of women, e.g. regarding technologies aiming to reduce their domestic burdens or to improve their income generating activities, or capacity building about climate change mitigation and adaptation strategies.
Related to resource mobilization and allocation at national levels recent studies show that it is important to take a relevant gender perspective, to provide equitable opportunities for women and men to voice their priorities and needs, and that it requires an institutionalized dialogue around national budget processes and national development plans.

In general, women’s access to aid resources and in particular to market-based funding opportunities is limited compared to men’s. An OECD analysis of aid in support for gender equality reported, that "while aid for transport, communications and energy infrastructure accounted for a third of bilateral aid, little was reported as focused on gender equality. Nevertheless, well-designed infrastructure projects can bring significant positive benefits for women and girls by improving access to markets, schools and health services or by increasing women’s safety."

Proper participation of women and men in decision-making in all phases and aspects of funding is essential: when designing, implementing, evaluating proposals, and reporting on programmes. Nevertheless, meeting of quantitative targets is but one aspect. Even more important are the efficiency and effectiveness of their participation and/or the involvement of gender experts.

Recommendations

Funds under the UNFCCC and the Kyoto Protocol are addressing parties, and country driven projects. Therefore the implementation of projects is under the responsibility of the countries. Nevertheless, there should be clearly defined criteria on social and economic justice, women’s human rights, and environmental sustainability which must be met by the host countries.

The goal of GEF’s work on global climate change is “to create a market atmosphere in which profitable investments in environmentally and socially sustainable technologies receive favorable treatment.” (Source: GEF’S WORK ON GLOBAL CLIMATE CHANGE, July 2006). Projects funded by the GEF should be carefully assessed in order to make sure that the market atmosphere is ensuring equal access of women and men to technologies and will benefit to women’s and men’s livelihoods equally.

The application of gender budgeting and gender audits in all funds will ensure that the money invested will serve to improve women’s situations as well as men’s.
When reviewing investments in programs for adaptation and mitigation, technology transfer, capacity building, etc., the SBSTA/SBI should also assess their contribution to social justice, and gender justice in particular. In order to measure progress, gender sensitive indicators must be developed. Currently, gender is a reporting category in GEF’s Small Grants Program only. However, this should apply to all programs related to climate change.

Taking into account the vulnerability of women, a certain amount of all donor funds related to UNFCCC should be earmarked for activities and projects explicitly addressing women, and designed and implemented by women / gender experts.