Green Banks Around the World: 2018 Year in Review
The Intergovernmental Panel on Climate Change’s (IPCC’s) fall 2018 report finds that to meet the goal of limiting global warming to no more than 1.5 degrees Celsius, investments in low-carbon energy technology and energy efficiency will need to increase by roughly a factor of five by 2050 compared with 2015 levels. This will require an unprecedented mobilization and redirection of domestic and international capital. In short order, successful strategies will have to be adapted and scaled and new financial instruments will have to be deployed to apportion risk in novel ways. Stable and effective enabling environments will have to be put in place that are nevertheless sufficiently flexible to account for rapid change.
Crucially, each unit of public or donor money will have to be used to mobilize multiples of private capital. The problem is that in most jurisdictions, there is no financial institution specifically focused on doing this. Green banks are the critical actor missing from the landscape of financial institutions.
These specialized financial intermediaries are a focal point for facilitating the climate finance ambition and market transformation demanded by the Paris Agreement, while delivering multiple sustainable development goal-focused benefits to governments and the private sector. This report takes a snapshot of work of the members and partners of the Green Bank Network.