External publication from the European Commission.
Frauke Röser, Markus Hagemann, Niklas Höhne, Murray Ward, Michel Bosquet, Hanna Fekete, Thomas Day, Gideon van Toledo
Developed countries committed to jointly mobilise USD 100 billion of international climate finance per year by 2020 to support climate change action in developing countries. While climate finance has started to flow it is still not fully understood how much finance will be required to support developing countries to meet mitigation objectives and in what way climate finance can help overcome barriers to low carbon development. This study aimed to provide insights into the questions of how much finance will be needed and how this should be delivered, through a comprehensive literature review of available studies and data on investment needs. This was coupled with sector specific case study analyses across nine countries to get a deeper understanding of existing barriers to low carbon investment choices and the role of different financial instruments to overcome these. The literature review comprised a broad review of national studies to identify whether and to what extent information on costs and required investments is available at country level. It included a review of in-country information such as national strategies and policies, Nationally Appropriate Mitigation Actions (NAMAs), Technical Needs Assessments (TNAs) and investment plans, focusing on developing countries that have mitigation pledges under the UNFCCC. In addition, the study provides an overview of approaches to estimate mitigation costs and the assumptions that have to be made in the process as well as a discussion of available global estimates.