Using results-based finance for climate action : existing initiatives and the role of the CDM
(2014)
Results-based finance is receiving increasing attention, being considered as a potential key funding mode in climate finance. The Clean Development Mechanism has been cited to potentially contribute to this goal. Against this background, the policy brief outlines the rationale of the concept and analyses six climate change mitigation initiatives that build on the results-based finance approach. The analysis puts a special focus on the role of the CDM.
The Clean Development Mechanism (CDM) is in crisis. More and more market participants are leaving the sector. In the light of this development, some argue that governments should step in as buyers of Certified Emission Reductions (CERs). Given the limited volumes of public funding, however, governments will have to prioritise some projects over others. This policy brief therefore analyses national purchase programmes and multilateral carbon funds in order to identify criteria public investors are applying in the selection of the projects they finance. The aim is to identify a vision of a high quality CDM project that be can be made use of when designing a possible support programme.