A study recently published by Climate Policy Initiative (CPI), The Global Landscape of Climate Finance 2012, estimates that global annual investment to curb climate change reached approximately USD 364 billion in 2010/2011. This amount, while significant, falls short of most estimates of investment needed to limit global warming to two degrees Celsius.

Building a complete picture of climate finance flows is critical to understanding how much, and what type of support, is available to address climate change. The Global Landscape of Climate Finance 2012 provides the most comprehensive global climate finance mapping effort to date.

According to the report, the private sector was the main source of global climate finance, contributing between USD 217 and 243 billion, mostly from corporations and renewable energy project developers. Public sector investment totaled between USD 16 and 23 billion globally. Most public sector investment acted as a catalyst for private investment through incentive mechanisms such as grants and loans at concessional terms that helped to lower investment costs. Public and private intermediary organizations such as national development banks and commercial banks also played an important role, raising and channeling between USD 110 and 120 billion, and often providing support for projects that would otherwise not be viable. The Global Landscape report also provided insights on how and where climate finance was used. Emerging economies were key recipients of climate finance, but were also important sources.

The Global Landscape of Climate Finance 2012 is part of CPI’s ongoing efforts to analyze how public policy can facilitate private investment most effectively. Further analytical reports in this work stream include the German Landscape of Climate Finance and in-depth case studies prepared within the San Giorgio Group.

Presenters: Morgan Hervé-Mignucci, Angela Falconer, and Chiara Trabacchi, CPI Venice

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