Methane is a high‑impact pollutant with a global warming potential more than 80 times that of CO₂ over 20 years, and has accounted for roughly 30% of historical warming. Yet, finance for methane abatement—one of the most cost-effective mitigation opportunities currently available—remains low. Less than USD 14 billion was invested annually in methane abatement in 2021/22, and preliminary results suggest this figure dropped to around USD 6 billion in 2023, falling far short of the estimated USD 48 billion required per year through to 2030.

Sustainable finance taxonomies are required to play a catalytic role in directing finance to methane mitigation. Financial frameworks like taxonomies are key to directing investment toward methane abatement. Beyond helping identify which projects can be classified as sustainable, they support financing mechanisms, such as green or sustainability-linked bonds, loans, and blended finance, to integrate methane mitigation into broader instruments. By ensuring environmental credibility, taxonomies help raise capital and build investor confidence. Over time, alignment across jurisdictions can also reduce transaction costs and facilitate cross-border investment in methane solutions. By embedding methane abatement activities and measures within their definitions of sustainable investments, taxonomies can accelerate deployment in mature abatement applications, prioritize harder-to-finance solutions in diffuse sectors, and create consistent signals that reduce perceived risks and funding costs.

This report presents a comparative analysis of how each selected taxonomy incorporates methane abatement activities within its sustainable finance framework. Five taxonomies— those of Colombia, the European Union (EU), Indonesia, South Africa, and Thailand—are examined as case studies to provide a balanced sample reflecting different levels of maturity, complexity, and regional context.

The aim is to identify gaps, highlight best practices, and offer practical guidance for taxonomy developers and policymakers on how to more effectively embed methane abatement in sustainable finance standards. By aligning financial definitions and criteria with methane reduction priorities, the report seeks to mobilize greater investment toward high-impact, cost effective climate solutions.

The report offers unique added value to taxonomy developers and the sustainable finance community in general, particularly to Ministries of Finance, Treasuries, and Planning Ministries developing national sustainable finance taxonomies, by providing:

• The first cross-regional comparative analysis of methane abatement coverage in national/regional sustainable finance taxonomies. 
• A methane sector-specific gap assessment comparing existing activities in taxonomies against a benchmark list to identify missing or insufficient efforts in methane abatement. 
• Recommendations to improve the credibility and impact of green finance. 
• Best-practice measures to support the integration of methane abatement into taxonomy frameworks. 

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