After lengthy talks in Songdo, UN-backed climate finance scheme has loose lending criteria for first funding proposals
By Megan Darby
The Green Climate Fund has not ruled out backing coal plants after a protracted three-day board meeting in Songdo, South Korea.
Tense negotiations ended at 0420 on Thursday with agreement on seven intermediaries to disburse funds for low carbon development and climate adaptation in poor countries.
That has paved the way for the first funding proposals to be considered “very soon”, according to board co-chair Henrik Harboe.
The fund expects to allocate resources before this December’s climate summit in Paris, where a global deal is due to be signed.
Yet the US$10.2 billion pledged by donor governments has been slow to materialise, with only 1% contributed a month before the 30 April deadline.
And civil society observers left disappointed at a lack of progress on key rules that will determine how the money is spent.
The meeting “failed to make any breakthroughs,” said Oscar Reyes, associate fellow at the Washington DC-based Institute for Policy Studies.
“It was a low-scoring draw, so we have to hope that the replay in Songdo in a couple of months produces a more positive result.”
In particular, there was no guarantee coal power, the most polluting use of fossil fuel, would be excluded.
That is a real concern for environmentalists after news agency AP revealed Japan has been pouring “climate finance” into coal plants in India, Bangladesh and Indonesia.
Karen Orenstein, from Friends of the Earth US, said: “It’s like a torture convention that doesn’t forbid torture. Honestly, it should be a no brainer at this point.”
The board did agree to set a minimum benchmark for the greenhouse gas emissions cuts projects must achieve, but not until 2016.
Meanwhile, they will apply an “assessment scale” to the first projects, which are set to be approved in October.
‘Unfeasible and unprofessional’
Norbert Gorissen, head of Germany’s climate finance department, accused India of blocking any objective criteria that would restrict its options.
The Asian country’s approach was “absolutely unfeasible and unprofessional,” he told RTCC. “They have the arrogant opinion that ‘the money belongs to us now and it is up to us how it is used’.”
The meeting “achieved what it had to achieve,” said Gorissen, but over-ran because certain board members “tend to pollute discussions” with climate politics.
Entities based in Senegal, Peru and Samoa were approved to channel funds, along with social impact investor Acumen and three international organisations: the Asian Development Bank, Germany’s KfW and the UN Development Programme.
The Centre de Suivi Ecologique, of Senegal, focuses on combating desertification and protecting coastal areas. The Fondo de Promoción de las Áreas Naturales Protegidas del Péru specialises in biodiversity conservation and managing protected areas.
Samoa-based SPREP backs sustainable development in the Pacific region. Acumen works to improve the lives of low income communities in Africa and Asia.
“We are excited about our newly approved initial group of partner institutions, as much as about their diversity and geographic representation,” said Héla Cheikhrouhou, executive director of the GCF.