Innovative Climate Financing for Adaptation Mainstreaming - - PowerPoint PPT Presentation

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Innovative Climate Financing for Adaptation

Mainstreaming Adaptation Financing in Development Planning in India

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Background

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Adaptation Development Time Technology? Finance? Measures?

• Huge adaptation financing needs in India:

As per MoEFCC, India would need USD 206 billion between 2015 and 2030

• Policy instruments: National Action Plan
• n Climate Change (NAPCC), National

Adaptation Fund on Climate Change (NAFCC)

• State Action Plans on Climate Change

(SAPCCs) have been developed by 32 states and union territories

• SAPCCs envisage state‘s strategies on climate change and will contribute to India‘s

NDC targets

• But still huge funding gap for SAPCC implementation

We need significant efforts to enhance capacities to conceptualise projects and access finance

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Why mainstream adaptation finance at lower levels of governance?

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Local level

Ease of convergence

• f funds and

schemes Supports decentralised planning Potential for piloting and replication Most adaptation

• ptions require

local implemen- tation Translation

• f SAPCC

priorities

• SAPCCs have large potential for impactful

climate action at the local level Challenges

• Lack of clear methodology for estimating

costs

• Lack of capacities to leverage interational,

national and private sector funds

• Little awareness in states about innovative

financing mechanisms

• Lack of prioritisation of climate actions

In absence of sustained funding, these action plans will be limited to budgetary allocations and short term emergency relief and humanitarian aid.

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Climate proofing local planning Bottom-up Top-down

Gujarat Punjab Haryana Uttar Pradesh Karnataka Andhra Pradesh Telangana Meghalaya Tripura Mizoram Nagaland Puducherry Lakshadweep

• Supporting states in accessing climate finance
• Financing instruments: Green Climate Fund

(GCF), National Adaptation Fund for Climate Change (NAFCC), Climate Change Action Programme (CCAP) Completed support:

• 7 states for accessing NAFCC
• Total climate finance accessed: INR 144.63

crores (EUR 19.6 million)

• Organised write-shops on proposal development

for accessing GCF and NAFCC

Climate Change Adaptation in Rural Areas (CCA-RAI)

Investment plans for SAPCCs

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Case study: Support to the Government of Karnataka for accessing NAFCC funds

Proposed project: Conservation of varieties of livestock (cattle and sheep) in Karnataka Funding source NAFCC Implementing department Department of Animal Husbandry and Veterinary Services Location 4 Districts and 3 sheep farms located in 3 different tracts of the state Process 2 consultations at state level and 3 consultations at local level (climate change nodal department, line departments, district departments, PRI, farmers, etc.) Financial outlay INR 24.68 crores (EUR 3.3 million) (cost towards land, vaccination, some equipment were borne by department)

Climate change issues for livestock sector:

• Low rainfall and high temperature
• Less availability of fodder & feed
• Non-potable water
• Heat distress
• Increased incidences of vector borne and parasitic diseases

Proposed solution:

Conserve and popularise indigenous varieties of livestock because they are:

• Drought resistant
• Less prone to diseases and

parasitic infestations

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Mainstreaming Adaptation into Local Planning

Define the boundaries:

• Past and current climate change trends in the state
• Vulnerabilities of key sectors
• Selection of vulnerable district and sector
• Potential schemes and programmes for convergence

Step 1: Screening 2a: Community-level data:

• Participatory Rural Appraisal
• Focus Group Discussions

Step 2: Detailed Analysis 2b: Scientific data including:

• Secondary sources, SAPCC
• Projections, journals, etc.

2c: Data Analysis

• Combine data sets and analyse climate risks and impacts
• Map existing coping mechanisms and list of potential adaption options
• Relevance to existing schemes/policies

NGOs experts

Stakeholder participation

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Mainstreaming Adaptation into Local Planning

Technical feasibility, financial feasibility, Urgency of CC vulnerability being addressed, convergence with existing programmes/schemes, direct and indirect beneficiaries Step 3: Identification & Prioritisation of adaptation measures

• What are the additional resources and technical skills needed?
• Which resources can be mobilised from the existing schemes?
• How can the action plan with adaption options be aligned with

existing scheme/plan?

• Are the options significantly different than what is being currently

implemented?

• Is it necessary to modify the original planning to integrate the option

for action? If so, how? Step 4: Demonstration and integration in local plan

Stakeholder participation

Step 5: Elaborate, implement and monitor an action plan

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Case study: Mainstreaming adaptation

• Detailed analysis: Climate change vulnerability assessment and

understanding current coping mechanisms of communities

• Selected adaptation activities:
• Treating the hilly ecosystem of Jawadhu hills watersheds to enhance

soil fertility and reduce soil erosion and increase the water storage

• Construction of percolation ponds, farm ponds and check dams
• Planting trees on slopes of field boundary
• Promoting cultivation of hardy crops
• Implementation of national and sub-national policies like PMKSY

and MGNREGA at the district level Eco-system based climate proofing watershed in Tiruvanmallai district, Tamil Nadu

Department of Environment,

Tamil Nadu Dhan Foundation State Agriculture Department and District Administration Convergence Opportunity Space and funds in District Irrigation Plan Incentive Assured employment through plantation in MGNREGA Enrollment of farmers in state millet mission Drivers Integrated Watershed Management Programme (IWMP) has plan for watershed development

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Investment Plans for SAPCCs in Punjab and Telangana

• Intensive

stakeholder engagement

• Nodal institution

for SAPCC Baseline Assessment

• Develop SAPCC

investment plan

• Case studies in

specific sectors prioritized for funding in the state Develop investment plan for SAPCC

• Based on SAPCC

and other state initiatives

• Use of MCA tool &

stakeholder consultation Prioritize activities

• Costing of SAPCC

activities

• Identify additional

financing requirements & innovative financing instruments needed Assess financing needs

Financing sources and instruments:

• International grants: GCF, UNDP, USAID, IDRC, DFID, etc.
• National grants: NAFCC
• Budgetary allocations: Devolution of fund fron centre to state, state budgets, etc.
• Loans/debt from international (e.g. World Bank, ADB, IFAD, etc.) and national (e.g. IREDA,

SIDBI, NABARD, etc.) sources,

• Bonds: Green bonds, climate bonds, etc.
• Equity: Private sector
• Taxes: Coal cess, other taxes
• Market-based instruments: Carbon markets, ES Certs, RECs

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Credit-based and Hybrid Models in Adaptation Financing

• Promoting environmentally sustainable growth by

encouraging private investments that are pro-poor

• Development of replicable business models for funding

sustainable and climate resilient natural resource management measures

• Paradigm shift: Move away from purely grant-based

funding to a greater reliance on loans

• Identifying synergies public and private sectors to attract

sustainable private investments

• Private companies invested 1.8 million EUR from CSR

funds for the implementation/ leverage of UPNRM projects Umbrella Programme for Natural Resource Management (UPNRM)

Strategic cooperation with:

National Bank for Agriculture and Rural Development (NABARD)

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Credit-based and Hybrid Models in Adaptation Financing

GIZ NABARD KfW

Technical support Financial support Duckery – Construction of duck shed, supply of ducks and feed to the beneficiary Flow of UPNRM funds Technical support

Channel Partner - Gram Uthan

Improved productivity of the beneficiary

Flow of funds from beneficiary to UPNRM Flow of technical support Flow of funds from UPNRM

Umbrella Programme for Natural Resource Management (UPNRM)

Credit for carrying out components of fish farming activity to the beneficiary Cultivation of two rows of banana/ papaya/drumsticks

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• Important to build capacities of various national and sub-national actors to

absorb climate funds

• Communities‘ indigenous knowledge for adaptation is critical
• Imperative to understand the linkages between climate change and national and

local development prioirities, needs and sectoral strategies

• Adaptation not necessarily additional to baseline investments – investments in

capacity and and integration of adaptation measures into ongoing planning

• Critical to engage the private sector, not just for funds but also for their due

diligence and R&D capabilities

• Need for innovative business models and financing instruments, especially for

adaptation

Key messages

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For more details, please contact Ashish Chaturvedi Director, Climate Change GIZ India Ashish.Chaturvedi@giz.de

Thank you!

Innovative Climate Financing for Adaptation