City Climate Finance Gap Fund Launches to Support Climate-smart Urban Development
Today, the City Climate Finance Gap Fund (“The Gap Fund”) was launched jointly by ministers and directors of the Governments of Germany and Luxembourg together with the World Bank, European Investment Bank, and Global Covenant of Mayors. It paves the way for low-carbon, resilient, and livable cities in developing and emerging economies by unlocking infrastructure investment at scale.
The Gap Fund will support city and local governments facing barriers to financing for climate-smart projects. Filling a gap in available project support, the Gap Fund offers technical and advisory services to assist local leaders in prioritizing and preparing climate-smart investments and programs at an early stage, with the goal of accelerating preparation, enhancing quality, and ensuring they are bankable.
With a target capitalization of at least €100 million, the Gap Fund will accelerate investments supporting cities in developing and emerging economies, as they determine goals and objectives for low-carbon and well-planned urbanization. The Gap Fund investment is aiming to unlock at least €4 billion of final investment in climate-smart projects and urban climate innovation.
“What cities do today will forever shape our climate tomorrow,” said Mari Pangestu, World Bank Managing Director for Development Policy and Partnerships. “Cities in developing countries urgently need resources to realize their climate ambitions. Through the Gap Fund, the World Bank is supporting low-carbon, resilient, inclusive, healthy, creative, and sustainable communities for all.”
Cities are on the frontlines of the climate emergency and currently account for around 70 percent of global CO2 emissions. Urban centers’ share of emissions is expected to grow as 2.5 billion people migrate from rural to urban areas by 2050. Before the COVID-19 pandemic struck, it was estimated that more than $93 trillion in sustainable infrastructure investment was needed by 2030 to meet climate goals. As cities strive to recover from the economic impacts of COVID-19, investments in clean energy, climate-resilient water and sanitation, and urban regeneration projects will play an important role in eliminating pollution, improving local food systems, and creating green jobs. They will also lead to cleaner, healthier, and more equitable communities – conditions that can help prevent future pandemics.
Climate investment projects are an indispensable opportunity to improve lives of the millions who live in cities around the world. However, cities frequently lack the capacity, finance, and support needed for the early stages of project preparation – especially in developing and emerging economies. This leads to impasses where cities cannot move project ideas to late-stage preparation and implementation. This hurdle is frequently overlooked by national and international support – a challenge the Gap Fund will seek to overcome.
The Gap Fund is an initiative of the governments of Germany and Luxembourg together with the Global Covenant of Mayors for Climate and Energy (GCOM), in partnership with several other key players in the climate finance arena (including C40, ICLEI – Local Governments for Sustainability, and Cities Climate Finance Leadership Alliance). It will be implemented by the World Bank and the European Investment Bank. The Gap Fund was announced at the UN Climate Action Summit 2019 as a key initiative of LUCI, the Leadership for Urban Climate Investment, which promotes financing for ambitious urban climate action until 2025. Core donors to the Gap Fund are Germany (€45 million – including €25 million from the Ministry for the Environment, Nature Conservation and Nuclear Safety, and €20 million from the Ministry for Economic Cooperation and Development) and Luxembourg (€10 million).
A City-Led Climate Resilience
Climate change is becoming a major cause of an increasing rate of weather catastrophes. The heat-trapping greenhouse gas is making Earth’s temperature warms up rapidly from what was planned since the industrial revolution and leading to overlapping problems, especially for the lower to middle-income countries around the equator. Many efforts are strived by stakeholders to minimize negative externalities from climate change, one of them is discussed about loss and damage. For more than 30 years this issue has been raised by developing countries, but the developed countries as the largest emitters always avoid this topic. Last year, at the UN annual climate talks or known as Conference of Parties (COP) 27 at Sharm el-Sheikh, there was a breakthrough regarding the loss and damage. Several countries including Denmark, Belgium, Germany, Scotland, New Zealand, Austria, Ireland, Canada, the US, the UK, Spain, the EU, and France show their commitments to addressing loss and damage fund. When we have been waiting for compensation in an uncertain time and current national action plans are not on track for under a 1.5oC, prior responses from other levels to cope with climate change are done by cities.
Cities are home to 55 percent of the global population and are expected to grow by 2.5 billion people to 68 percent by 2050. As climate change deprivation many people’s livelihoods, these conditions drive millions of people to migrate to cities with the hope they would gain more opportunities to survive. As a result, many cities have experienced overpopulated and rapid urbanization under climate change without efforts to increase resilience is exposing cities to gain more climate risks. Recorded approximately 225.3 million internal displacements in the Asia and Pacific region happened during 2010 – 2021, especially in the five sub-regions (East Asia, Southeast Asia, South Asia, Central and West, and Pacific). Increasing mobility in the cities has led to the production of approximately three-quarters of energy-related CO2 of the total global emissions. Recorded that as much as 70 percent of cities worldwide are already dealing with the effect of climate change.
In efforts to tackle the climate crisis, the local government of the cities needs to reinforce the two-prolonged approach which is mitigation and adaptation. Undertaking a human rights-based approach (HRBA) as city-led climate agenda is a tool for realizing ecosystem-based agenda (EbA) which can be implemented through a local climate change action plan where human rights are a fundamental value. For example, Bilbao is a city council that adopted Charted Values, and Utrecht is a Global Goals City that cooperates with local businesses to raise awareness of their rights and monitors progress on the SDGs dashboard. In Asia, Gwangju has established a human rights department, hosted the annual World Human Rights Cities Forum as one of the most relevant events for bringing local government officials with organizations and other actors to establish and arrange systems to ensure human rights as a core, and implementing localization projects. Another example, in efforts to reduce emissions, Seoul has mandatory for their citizen that should be used all new vehicles to be electric from 2025. In addition, to support this program, the city is released electric vehicle charging infrastructure powered by solar panels which are accessible and provides subsidies for electric vehicles of up to 20 percent with additional support available for low-income households. This policy is expected to reduce emissions by approximately 43 percent compares with 2005 levels and create almost 15.000 jobs.
Moreover, hundreds of cities also show their commitment to accelerating net zero emissions by building networks. Recorded as many as 130 American cities are stepping up their ambition to reduce emissions by joining the Cities Race to Zero to help the US reach its goals of reducing emissions by 2030 and achieving net zero by 2050. Last year, the European Commission also announced 100 cities from the EU member states with 12 additional cities participating in EU Mission for climate-neutral and smart cities by 2030 or known as the Cities Mission. Under this mission, the cities will receive millions of funding in the period 2022-2023 to address clean mobility, energy efficiency, and green urban planning, and offer the possibility to build joint initiatives and ramp up collaborations with other EU programs. The ranking compiled by CDP shows that only 43 out of 596 cities or similar to 7 percent received a top rank for their climate leadership and reduction of emissions, which twenty-one of them are in North America, nine in Europe, four in Australia, one in Latin America and Africa, and four in East Asia.
The proportion above, Asia and Africa have a minimum ‘A’ city in reducing emissions. The report mentioned five barriers that limit urban resilience that are multi-level governance, finance, a local capacity, access to technology and innovation, and equity. The Mayor of the City of Bonn, Mr. Ashok Sridharan said that “The adaptation fund has been instrumental in advancing adaptation to the most vulnerable over the past 10 years and ‘walks the walk’. Cities and regions stand ready to help as global adaptation needs continue to rise”. Nowadays, the ten members of ASEAN with a majority of developed countries have slow progress and struggling in energy transition because they have insecure funds. To achieve ASEAN’s target of 23 percent renewable energy supply by 2025 need an investment of US$ 27 billion per year. However, from 2016 – 2021, the ASEAN countries received no more than US$ 8 billion per year. At the global level, the World Bank estimated an amount of US$ 4.5 – 5.4 trillion per year which 9 – 27 percent part of it is aimed to make an urban infrastructure low-emission and resilient to climate risks. However, UNFCCC released there is a gap of US$ 1.8 – 2.4 trillion per year in financing for climate-resilient infrastructure globally with the majority of needed in urban areas.
Cities become a frontline in adaptation and mitigation because they prioritize sustainably local projects faster than a state. Therefore, with the financial barriers to access technology faced by the local governments, the discussion about climate funds should mobilize in the UN annual meeting about climate to enhance climate resilience as a priority within all of the cities, especially in the developing countries in Asia and Africa.
Net-Zero Buildings: Global CEOs Pledge 50% Cut in Real Estate Emissions by 2030
Leading CEOs made a pledge today to reduce their real estate emissions by 50% by 2030 and reach net-zero carbon no later than 2050.
With buildings contributing 38% of all energy-related greenhouse gas emissions, leaders across all industries have a critical role to play in lowering their global real estate emissions.
“While real estate represents nearly 40% of all energy-related GHG emissions, the sector is frequently an afterthought when it comes to an organization’s decarbonization and sustainability strategies,” said Matthew Blake, Head of Financial and Monetary Systems, World Economic Forum. “Leaders across all industries have a responsibility to take action on their real estate GHG emissions to ensure progress in the fight against climate change.”
The following companies have pledged to halve their buildings-related emissions by 2030 and reach net-zero building emissions by 2050:
- Avison Young
- GPFI Group
- Ivanhoé Cambridge
- Majid Al Futtaim Properties
- Schneider Electric
These firms will meet these targets by implementing the Forum’s Green Buildings Principles. Released last year, the Green Building Principles: The Action Plan for Net-Zero Carbon Buildings provides a clear sequence of steps to deliver net-zero carbon real estate portfolios:
1. Calculate a robust carbon footprint of your portfolio in the most recent representative year to inform targets
2. Set a target year for achieving net-zero carbon, by 2050 at the latest, and an interim target for reducing at least 50% of these emissions by 2030
3. Measure and record embodied carbon of new developments and major refurbishments
4. Maximize emissions reductions for all new developments and major refurbishments in the pipeline to ensure delivery of net-zero carbon (operational and embodied) by selected final target year
5. Drive energy optimization across both existing assets and new developments
6. Maximize supply of on-site renewable energy
7. Ensure 100% off-site energy is procured from renewable-backed sources, where available
8. Engage with stakeholders with whom you have influence in your value chain to reduce scope 3 emissions
9. Compensate for any residual emissions by purchasing high-quality carbon offsets
10. Engage with stakeholders to identify joint endeavours and equitably share costs and benefits of interventions
Developed in collaboration with JLL, the World Green Building Council and the Forum’s Real Estate community, the Green Building Principles can be formally adopted by firms and include an Action Plan detailing implementation.
The Action Plan provides globally applicable guidance on best practices to implement the principles for every stakeholder, from owners to occupiers to investors. Signatories will report progress annually as part of their public sustainability reporting and participate in a Practitioners Group to identify solutions around implementation.
Signatories share why they have pledged the Principles:
“More sustainable real estate is essential,” said Coen van Oostrom, Founder and Chief Executive Officer, Edge. “The Principles offer a clear roadmap to help all building stakeholders tackle their emissions and deliver better buildings. The world deserves better buildings and it is entirely possible to significantly reduce the impact of both existing and new buildings.”
“It’s imperative that we address real estate related emissions,” said Christian Ulbrich, Global Chief Executive Officer and President, JLL. “Getting started is often the hardest part and the Principles offer a simple set of steps to do so. We believe it is easier to get to net zero in the built environment than for many companies to get to net zero in their core businesses and the business case is there to support action.”
“The emphasis on bringing together the world’s leading businesses and public figures to collectively address issues like climate change and driving social change is fundamental to what Avison Young stands for. ESG considerations across the board must be addressed by the real estate sector — buildings have a huge impact on our everyday lives and the planet,” said Mark E. Rose, Chairman and CEO, Avison Young. “We are thrilled to adopt the Green Building Principles and demonstrate to our peers that reaching net zero is not only possible but essential for a better built environment and more resilient and successful cities.”
“By nature, real estate requires long-term thinking and so we have a duty to invest with conviction and build a legacy for future generations,” said Nathalie Palladitcheff, President and CEO, Ivanhoé Cambridge. “We have a collective opportunity and responsibility to decarbonize the built environment and this ambitious commitment will require a transformation of practices across the whole real estate value chain.”
“The industry has traditionally looked at investments in sustainability as a trade-off with other aspects like customer experience, but it’s very clear that we need to shift our mindset,” said Ahmed Galal Ismail, CEO, Majid Al Futtaim Properties. “Sustainability is actually a trade-on and sustainable assets are more valuable. We are committed to transitioning our portfolio and proving what is possible in alignment with the Principles.”
“We have the innovation to both transform the current building stock through electrification and digitalization and develop smart, green buildings of the future,” said Philippe Delorme, Executive Vice President, European Operations, Schneider Electric. “Schneider Electric is proud to adopt the Principles and demonstrate how we can transition buildings to be healthier, more efficient and ultimately net-zero carbon.”
“We continue to be committed to the planet and addressing our real estate footprint” said Harsh Chitale, CEO, Digital Solutions Division, Signify. “The Principles are an ideal way to help every type of company address emissions from the buildings they own and/or occupy.”
“As a facility management company, we play a major role in the drive for adoption and implementation of emission reduction programs,” said Dr. MKO Balogun, Group CEO, GPFI Group. “Our role working with occupiers, owners, and developers of real estate gives us the leverage to drive that commitment, and we are glad to be joining other global leaders on this journey.”
Traditional building practices offer sustainable solutions as African cities grow
Located on the dusty outskirts of the Burkina Faso town of Koudougou, the Lycée Schorge Secondary School shows what is possible when you mix traditional techniques and new materials.
The school consists of nine modules arranged around a central courtyard, protecting the central space from wind and dust. Each module is built out of locally sourced laterite which is cut into bricks and left in the sun to harden. These bricks absorb the heat during the day and radiate it at night.
A secondary façade made of local eucalyptus wood wraps around the classrooms like a transparent fabric and creates various shaded spaces to protect students from stifling daytime temperatures.
The building, designed by the Berlin-based, Burkinabè founded architecture firm Kéré Architecture, is an example of how countries on the continent are using traditional building techniques to lessen the carbon footprint of their buildings.
Research shows that these techniques can help prevent the need for air conditioning, the long-range transport of building materials and concrete production, all of which contribute to the greenhouse gas (GHG) emissions driving the climate crisis.
With 70 per cent of Africa’s building stock that will exist in 2040 still to be constructed, experts say these energy-saving techniques are crucial.
“Traditional sustainable construction and building practices are a cornerstone of African cultural heritage,” says Jonathan Duwyn, from the United Nations Environment Programme’s (UNEP’s) Buildings and Construction, Cities Unit.
“Locally adapted sustainable design, construction, practices, and materials coupled with renewables and innovation represent a great opportunity for both mitigation and resilience in Africa’s rapidly growing building stock.”
The continent accounts for roughly 6 per cent of global energy demand, with more than half of this coming from its buildings. Given that Africa’s population is expected to reach 2.4 billion people by 2050, with 80 per cent of this growth occurring in cities, it is clear that sustainability needs to be a core principle of all future buildings.
With the launch of UNEP’s 2022 Global Status Report for Buildings and Construction at the UN Climate Conference (COP27) today, the focus is on how Africa can manage this urban growth and increase the resilience of its housing stock while avoiding an increase in GHG emissions.
It is a tall order, yet inspiration can be found in Africa’s past. Travel through Africa today, and hints of this past can be found everywhere, from Eswatini’s beehive huts to the Drogon cliff villages of Mali to the mud-brick mosques of West Africa.
“Africa is rich in renewable energy sources, solar and wind, with nearly half of the planet’s total renewable energy technological potential,” Duwyn says. “Locally adapted sustainable design, construction, practices, and materials coupled with renewables and innovation represent a great opportunity for both mitigation and resilience in the face of Africa’s rapidly growing building stock,” he adds.
This is particularly important given the projected demand for air conditioning units as more people get access to electricity and temperatures rise. “We expect cooling to be a major challenge when it comes to residential energy demand in Africa in the future,” says Duwyn. “This is why it is so important to ensure new buildings use natural cooling systems wherever possible.”
Only 43 per cent of the population had access to electricity in 2021, and the International Energy Agency estimates that African household energy demand by 2030 for cooling will increase the most.
Another Kéré Architecture project utilizing sustainable design and building practices is the Gando primary school. It is constructed of clay/cement hybrid bricks for a dry-stacked brick ceiling – instead of the more common corrugated metal roof – allowing maximum natural ventilation.
“These projects show that sustainable building practices are possible when innovative techniques are used,” says Duwyn. “And as Africa’s climate warms even more, it is vital that we embrace sustainable building designs that do not need costly and damaging cooling systems.”
As the Building Global Status Report highlights, Africa is rich in natural, sustainable materials such as adobe, laterite, termite mound soil, timber, stone, bamboo, sand and dry vegetation. While traditional construction techniques include rammed earth, sun-dried bricks, compressed earth blocks, wattle and daub, cob, timber-framed construction, sandbag construction and thatched roofs.
Ensuring sustainable materials are used is particularly important, given that according to UNHabitat, more than half the population (excluding in North Africa) live in overcrowded informal settlements, which are particularly vulnerable to the impacts of climate change.
“Quality, sustainable housing is an important way of ensuring vulnerable populations are more resilient to the effects of the climate crisis,” Duwyn says. Particularly the frequency of natural disasters has tripled in the past 30 years, with Sub-Saharan Africa home to nearly three-quarters – 393 million – of the global number of children living in countries affected by emergencies.
As the report makes clear, there is no one-size-fits-all answer to tackling Africa’s future building needs. But, as it is rich in renewable energy sources, and most of its building stock over the next two decades still needs to be built, the continent is well placed to be a leader in sustainable design practices.
Aurat March 2023 & Agenda Setting
In history, women are portrayed in default of men. The women in primitive societies were freer and more emancipated than...
Confrontation between US and Chinese ships in South China Sea
A US Navy destroyer sailed near the disputed Paracel Islands in the South China Sea and sparked yet another confrontation...
Seymour Hersh: The cover-up
This is a new comment of American journalist Seymour Hersh: “It’s been six weeks since I published a report, based...
The dilemma of China’s role as Mediator in the case of Ukraine
Since the full-scale Russo-Ukrainian war unfolding after 24 February 2022, China has maintained so-called neutral stance on the conflict, passively...
China Gains Political Clout in the Middle East at the expense of the US’s Indispensability
There is yet another détente in the Middle East, but it is neither between Israel and Arabs nor has the...
Breaking Diplomatic Norms: Indian Response to OIC & Turkish Support for Kashmir Issue
Recently, the Indian government has been facing backlash for its highly undemocratic and derogatory remarks on Turkey’s support to the...
Playing The New Game of Geoeconomics
In these contemporary times, state actions are now rendered by the emergence of ‘Geo Economics’. Implying the term coined by...
Middle East3 days ago
Arab plan for Syria puts US and Europe in a bind
Economy4 days ago
Impact of technological advancements on International Trade and Finance
Finance3 days ago
Credit Suisse Collapse – this is a robbery of Arab investors
Middle East3 days ago
Iraq’s Geopolitics, Key Factor for US, EU Energy Security Strategies
South Asia4 days ago
India’s G20 Leadership: Challenges and Opportunities
Southeast Asia4 days ago
Indonesia: Climate Change Challenges
New Social Compact4 days ago
Dance and games offer glimpses of life – and death – in ancient Italy
Russia4 days ago
The Political and Diplomatic Implications of the ICC’s Arrest Warrant for Vladimir Putin