Towards a green economy

Private-sector funding can be mobilised through, for example, Build-Operate-Transfer schemes, which have successfully channelled private resources into large infrastructure projects in many developing countries.35

Furthermore, there are a number of climate-oriented financing instruments with increased levels of funding available for green transport. For example, the Global Environment Facility (GEF) has released US$ 2.675 billion for transport projects over the last 20 years (GEF, 2009).36

The

Climate Investment Fund (CIF) and its Clean Technology Fund (CTF) have started to address transport as a key sector.

The financing framework (or the combination of the above options) for green transport would need to consider the following issues (Sakamoto et al. (2009):

■ Its ability to generate the level of funding required to shift the emphasis towards sustainable transport;

■ The ongoing stability of funding – enabling the sustainable

transport strategy to be continuously implemented and long-term goals to be pursued;

■ Efficiency – ensuring that resources are allocated to their

best use, and reducing transaction throughout the system;

35. For practical guidance on utilising private finance for transport, see for example World Bank/ICA/PPIAF (2009).

36. US$ 201.5 million of direct finance matched by US$ 2.47 billion in co- financing as of May 2009.

Box 9: Share the Road

UNEP’s Share the Road campaign promotes non-motorised transport (NMT) by advocating increased investment by donors and govern- ments in NMT infrastructure within road projects (e.g. at least 10 per cent of the overall budget). The emphasis is on a paradigm shift towards roads that benefit all users and thus re-thinking how space and resources are shared between pedestrians, cyclists, users of public transport and motorists. Increased investment in NMT infrastructure can substantially benefit the environment (air quality, GHG emissions), development (accessibility, affordability), and safety (protected facilities for vulnerable users), and it is a prerequisite for building resource- efficient, liveable cities. Share the Road is working with partners with a view to making safe, low carbon and accessible mobility a reality for all users (UNEP and FIA Foundation, forthcoming at www.unep.org/transport/sharetheroad).

■ A transport-specific instrument (see Bridging the Gap, 2010 for a proposal for a sectoral approach in transport); and

■ Other potential funds specific to capacity- building or technology.

Nationally Appropriate Mitigation Actions

supported by developed countries are likely to be backed by fund-type instruments, whereas actions taken to acquire credits would be enacted through a crediting scheme such as an up-scaled CDM.38

37. Of the 2,400 registered CDM projects (as of October 2010) only three are transport projects, and only 32 out of the 5,529 CDM projects in the pipeline relate to the transport sector. Transport therefore only constitutes less than 0.l per cent of expected CERs. Source: UNEP-Risoe Centre.

38. The framework surrounding NAMAs is continuing to evolve, with the Conference of Parties (COP) to the United Nations Framework Convention on Climate Change (UNFCCC) agreeing at its 16th session in Cancun Mexico that developed countries shall provide support for preparation and implementation of developing country NAMAs, and that a registry will be set up to match finance, technology and capacity building support to NAMAs seeking international support. Nationally Appropriate Mitigation Actions are principally driven by the developing countries. As noted in Binsted et al. (2010), many developing countries (26 of the 43 countries that submitted NAMAs to the UNFCCC by September 2010) have proposed NAMAs in the transport sector. Available at:: http://www.transport2012.org/bridging/ressources/ files/1/913,828,NAMA_submissions_Summary_030810.pdf

costs

■ A transport window under a Mitigation Fund such as the future Green Climate Fund;

■ An up-scaled, programmatic CDM;

In the context of the ongoing negotiations on climate change, the design of financial instruments need to take into account the failure of existing instruments such as the Clean Development Mechanism (CDM),37

transport in developing countries are

■ Equity – both horizontally (i.e. fair treatment of all transport users) and vertically (i.e. across income groups, ensuring support to those who are most deprived);

Box 10: The future role of climate finance in enacting green transport

to

be fully applied to the transport sector. Under a Post-2012 framework, mitigation actions in

likely to fall under the umbrella of Nationally Appropriate Mitigation Actions (NAMAs), which could be financed through:

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