The EU Contribution to Current Climate Finance Goals

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The EU's contribution to current climate finance goals, including its impact on EU climate goals and international climate finance. It analyzes the progress made, open questions and issues, and proposes ways forward to increase effectiveness.


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  1. The EU Contribution to Current Climate Finance Goals Status Quo, Requirements, and Options Margit Schratzenstaller Workshop The Role of the EU Budget in International Climate Finance Brussels, January 30, 2023, European Parliament Budget Committee

  2. Outline Contribution of the EU budget to EU climate goals to international climate finance 2

  3. Contribution EU budget to EU climate goals (1) Recent progress made Climate mainstreaming goal increased from 20% 2014-2020 to 30% 2021-2027 Introduction of DNSH principle 3

  4. Contribution EU budget to EU climate goals (2) Total (EUR billion) 226 48 19.21 99 291 95.52 Funds % climate target Total volume MFF + NGEU: 1.74 trillion (1.7% of EU-GNI) Climate spending: 0.5 trillion (0.5% of EU-GNI) ERDF CF JTF ESF+ EAGF EAFRD Min. 30% Min. 37% 100% Not specified Min. 40% (all CAP), specifically Min. 35% for EAFRD Not specified Min. 30% Min. 37% Min. 60% Min. 30% Min. 35% Min. 61% Min. 18% (20% by 2027) Min. 30% EMFAF InvestEU RRF CEF ESP Horizon LIFE IPA III NDICI Source: based on EC MFF 2021. Notes: 1Including EUR 10.8 billion allocated under NGEU; 2 including EUR 8 billion allocated under NGEU; 3 including EUR 6 billion allocated under NGEU; 4 including EUR 338 billion in grants and EUR 386 billion in loans allocated under NGEU; 5Including EUR 5.4 billion allocated under NGEU. 6.1 93 723,84 20.7 14.8 86.15 5.4 14.2 79.5 4

  5. Contribution EU budget to EU climate goals (3) Open questions and issues (1) Targets and tracking methods differ across funds Implementation of DNSH principle differs (CAP?) 5

  6. Contribution EU budget to EU climate goals (4) Open questions and issues (2) No differentiation between adaptation and mitigation No comprehensive ex-ante and ex-post climate impact assessment 6

  7. Contribution EU budget to EU climate goals (5) Is it enough? Example of green investment gaps in Member States In % of GDP 7 Source: Delgado-T llez et al. (2022).

  8. Contribution EU budget to EU climate goals (6) The way forward (1) Increase space for increase of climate (and biodiversity ) spending through shifts within EU budget Apply DNSH principle 8

  9. Contribution EU budget to EU climate goals (7) The way forward (2) Determine climate impact ex-ante and ex-post comprehensively Strengthen contribution of revenue side ( green own resources ) 9

  10. Contribution EU budget to EU climate goals (8) The way forward (3) Increase climate mainstreaming goal Improve tracking methodology Don t forget other environmental goals (biodiversity!) 10

  11. EU contribution to international climate finance (1) EU contribution to public climate finance in developing countries, in billion 25 23.40 23.20 23.04 21.70 20.40 20.20 20 17.60 14.50 15 9.60 10 5 0 2013 2014 2015 2016 2017 2018 2019 2020 2021 Source: Council of the European Union (2022). 11

  12. EU contribution to international climate finance (2) Climate finance provided and mobilised, 2013 to 2020, in US$ billion 90 83.3 79.9 80.4 80 13.1 14.4 71.6 14.7 70 1.9 61.8 2.6 14.5 2.7 58.5 60 52.4 3.0 16.7 10.1 Data gap 50 36.9 1.5 30.5 34.7 12.8 1.6 2.5 27.1 40 1.6 18.9 16.2 20.4 30 15.5 20 32.0 31.4 28.7 28.0 27.0 25.9 23.1 22.5 10 0 2013 2014 Multilateral public (attributed) 2015 2016 2017 Export credits 2018 Mobilised private (attributed) 2019 2020 Bilateral public Source: OECD (2022). 12

  13. EU contribution to international climate finance (3) Missed target developed countries pledges 2013 to 2019, in US$ billion 2020 Target for 2020 2019 28.8 34.1 2.6 14.0 79.6 2018 32.0 29.6 2.1 14.6 78.3 2017 27.0 27.5 2.1 14.5 71.1 2016 28.0 18.9 1.5 10.1 58.5 No data for private finance in 2015 2015 25.9 16.2 2.5 2014 23.1 20.4 1.6 16.7 61.8 2013 22.5 15.5 1.6 12.8 0 10 20 30 40 50 60 70 80 90 100 Bilateral finance Multilateral finance* Export credits Private finance Source: OECD (2021). * Including financing through multilateral development banks. 13

  14. EU contribution to international climate finance (4) Source: Timperley (2021). * Estimates include both bilateral and multilateral development bank financing, and incorporates European Union climate financing, apportioned to relevant nations. 14

  15. EU contribution to international climate finance (5) Does EU contribution suffice? $ 100 billion by far not enough Pledges inflated 15

  16. EU contribution to international climate finance (6) The way forward (1) Increase space in EU budget for additional EU contributions to international climate finance through shifts in expenditures raising (green) own resources 16

  17. EU contribution to international climate finance (7) The way forward (2) Focus on grants (versus loans) EU-wide coordination of MS pledges ( fair share ) 17

  18. EU contribution to international climate finance (8) The way forward (3) Dismantle MS fossil fuel subsidies Mobilise private funds 18

  19. References Council of the European Union (2022). Infographic - Europe's contribution to climate finance ( bn). https://www.consilium.europa.eu/en/infographics/climate-finance/ Delgado-T llez, M., Ferdinandusse, M., and Nerlich, C. (2022). Fiscal Policies to Mitigate Climate Change in the Euro Area. ECB Economic Bulletin Articles, 6. European Court of Auditors (2022). Climate Spending in the 2014-2020 EU Budget Not as High as Reported. https://www.eca.europa.eu/Lists/ECADocuments/SR22_09/SR_Climate- mainstreaming_EN.pdf Levarlet, F., Alessandrini, M., Schratzenstaller, M., Franceschelli, N. (2022). Climate Mainstreaming in the EU Budget: 2022 Update. https://www.europarl.europa.eu/RegData/etudes/STUD/2022/732007/IPOL_STU(2022)7320 07_EN.pdf OECD (2022). Aggregate Trends of Climate Finance Provided and Mobilised by Developed Countries in 2013-2020, Climate Finance and the USD 100 Billion Goal. OECD Publishing. https://doi.org/10.1787/d28f963c-en OECD (2021). Climate Finance Provided and Mobilised by Developed Countries: Aggregate Trends Updated with 2019 Data, Climate Finance and the USD 100 Billion Goal. OECD Publishing. https://doi.org/10.1787/03590fb7-en Timperley, J. (2021). The broken $100-billion promise of climate finance and how to fix it. Nature, 598 (21 October 2021), pp. 400-402. 19

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