Carbon Financing

Cities in industrialised and developing countries are confronting the new challenges arising from climate change. The Clean Development Mechanism (CDM) and other forms of Carbon Finance can play an important role in supporting cities in their mitigation efforts. However, cities often lack a detailed understanding of how to access and apply carbon finance instruments, and are therefore deprived of an important source of revenue as well as potential social and environmental benefits of energy saving and emissions reductions.

80% of the world’s greenhouse gas emissions are emitted from or for cities. The majority of emissions are caused by cities in industrialised countries, and the effectiveness of additional reductions can be much higher when tackled through an off-setting scheme in cooperation with a partner from a developing country.

Southern cities can profit financially and otherwise from an active involvement in Carbon Finance and specifically CDM activities. Carbon Finance projects, in addition to reducing greenhouse gas emissions, can help to develop local economies by creating jobs, improving provision of services and addressing social problems.

Up until now, Carbon Finance concepts have mostly been applied at national levels. The 3-year Carbon Finance Capacity Building (CFCB) programme will assist existing and emerging mega cities all over the world to harness the carbon finance opportunities of the UN Kyoto Protocol.

The CFCB programme was launched at a Kick-off conference in Basel, Switzerland from 4-6 February 2009. The event, hosted by the city of Basel, provided an introduction to the carbon finance market development and instruments as well as insights into the perspectives and potentials of the Clean Development Mechanism.

Objectives of the CFCB programme:

• Demonstrate the potential contribution of Carbon Finance to lower carbon city growth and poverty reduction
• Raise the awareness of city officials and other stakeholders, facilitating knowledge transfer
• Highlight projects that could be implemented in their cities
• Facilitate institutional networking and provide continuous on-site project support
• Trigger Capacity Building with Carbon Finance programmes
• Advise on project implementation
  

Cities:

Nine core cities have been identified to participate in the 3-year programme:

• Sao Paulo
• Cape Town, Tshwane & Johannesburg
• Dar es Salam
• Surat and Delhi
• Jakarta
• Quezon City

The C40 is supporting the CFCB programme which is organised by ecos, and sponsored by the World Bank, Carbon Finance Assist, SECO and the City of Basel.

For further information, please visit: www.lowcarboncities.info.