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The Subnational Climate Finance initiative is now a reality
By R20 Regions of Climate Action | 24th November 2020 | Updated at 09:11
| Since its creation in 2012, R20 has exclusively dedicated its efforts to facilitating the working relationship between sub-national policy and decision makers; clean technology developers and service providers; and public and private investors, with the goal of rapidly scaling up Subnational low-carbon sustainable development projects worldwide.
Thanks to the positive results of our initial Subnational low carbon and climate resilient infrastructure demonstration projects in the field of waste management (Wilaya of Oran in Algeria), decentralised renewable energy (Province of Kita in Mali and Delta State in Nigeria), energy efficiency (States of Mato Grosso and Rio de Janeiro in Brazil) etc, we have witnessed many obstacles that sub national authorities face in pursuing their own climate change action agendas. Two of them are definitively the lack of bankable impact projects on the one hand; and adequate finance vehicles dedicated to sub national, mid-size infrastructure on the other hand.
In order to solve this situation and allow replicability at large scale, and in order to contribute significatively to zero net emissions by 2050, R20 has worked tirelessly these last 4 years to set up a complete ecosystem and a full value chain. It is composed of Technical Assistance (permitting capacity building and feasibility studies) for sub national authorities to secure bankable projects and a blended equity Fund to invest in the resulting high-quality portfolio of projects. This initative has been endorsed and received the support of the Global Innovation Lab for Climate Finance.
The result is that in partnership with the Green Climate Fund (GCF), R20 structured a robust consortium composed of a Fund manager (Pegasus Capital Advisors); a commercial bank (BNP Paribas); an international organisation with extensive experience in Nature-based Solutions (the International Union for Conservation of Nature); and a climate and SDG impact standard (Gold Standard).
R20 and its consortium of partners are proud to announce that, at its last Board meeting held November 13, 2020, The Green Climate Fund has approved the establishment of the Global Subnational Climate Finance initative composed of a grant based Technical Assistance and an equity investment Fund with a total support of 168 M $USD. Thanks to this initial fundings the consortium is seeking to raise additional private capital.