Paris compatible investment criteria

NewClimate Institute together with Germanwatch, WRI, and Fundación Avina, examined the role of Multilateral Development Banks (MDBs) in supporting the implementation of the Paris Agreement.

The Paris Agreement aims to hold the increase in the global average temperature to well below 2°C above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5°C. The MDBs have operated under a Climate Finance Paradigm. Yet, given the urgency of the challenge and the rate at which the world must reduce emissions, a new paradigm is needed. This research provides recommendations on how the MDBs could strengthen existing tools to align their portfolios and activities with the globally agreed mitigation goal and transition to the Paris Alignment Paradigm.

As part of this project, NewClimate developed approaches to check whether investments in energy and transport infrastructure are aligned with the Paris Agreement temperature goal.

The project received financial support from GIZ on behalf of the Federal Ministry for Economy Cooperation and Development of Germany (BMZ).