Take it global, please
At first glance, the scale of financing needed to build our low-carbon future is daunting. In Copenhagen, governments pledged to scale annual public climate finance to US$100 billion by 2020. And that US$100 billion would be used to unlock trillions – mostly in pension funds – to help build the infrastructure, cities and ecosystems needed for a low-carbon world.
The New Climate Economy calculate that strengthening economic growth through 2030 will require an estimated cumulative US$89 trillion of infrastructure investment under a business-as-usual scenario, whereas investing in low-carbon infrastructure only requires an additional US$4.1 trillion.
The money is beginning to shift. Private sector financial institutions hold around US$305 trillion of which US$59 trillion is managed by investors making a public commitment to climate and responsible investment through the Principles for Responsible Investment.
Green bonds, created to build the clean economy, are taking off: US$36 billion in 2014, US$100 billion in 2015 and estimates to triple by 2018.
It is a pivot for the finance sector and one that the UNEP Financial Inquiry has helped shape. When asked how to deliver scaling investment, Sean Kidney, CEO of The Climate Bonds Initiative his only ask was: “Take it global, please.”