Australia
Political commitments, strategies and tools
Australia’s political commitments
During Australia's National Statement at COP26 on 1 November, Prime Minister Scott Morrison announced the doubling of Australia's previous AUD 1 billion pledge over 2015-2020 to AUD 2 billion over 2020-2025. This was AUD 500 million more than his earlier 2020-2025 climate finance commitment of AUD 1.5 billion made in December 2020. This commitment will be implemented through Australia's development programme.
As a member of the Pacific Island Forum (PIF), Australia signed up to the 2018 Boe Declaration on Regional Security and the 2019 Kainaki II Declaration for Urgent Climate Change Action Now. These declarations reflect the position of PIF Leaders, who have identified climate change as the single greatest threat to the livelihoods, security and well-being of the peoples of the Pacific. In line with the declarations, Australia is committed to supporting climate change and disaster resilience as a top priority for its development assistance, reflecting the priorities of Pacific-led initiatives.
Australia has joined the High Ambition Coalition for Nature and People and the Global Ocean Alliance, and is committed to the global target of protecting 30% of land and of ocean by 2030, which it supports beyond domestic action, through its international engagement.
Targets
Australia provided AUD 1.4 billion in climate finance over 2015-20, exceeding its commitment to provide at least AUD 1 billion in climate finance over five years. This included providing AUD 408 million in climate and disaster resilience support to the Pacific, exceeding its commitment of AUD 300 million over four years (2016-17 to 2019-20).
As set out above, a doubling of Australia's global climate finance commitment to AUD 2 billion from 2020-2025 is a key aspect of Australia's overall commitment to climate change through its development programme. This expenditure includes AUD 700 million specifically for the Pacific to invest in renewable energy and climate change and disaster resilience, and will include both targeted climate-specific investment as well as mainstreaming climate across all sectoral investments.
Australia tracks its climate finance expenditure based on the agreed OECD DAC statistical markers for climate change mitigation and adaptation. The methodology is tailored to Australia’s development assistance programme, reflecting the mix of modalities through which its development assistance – bilateral, regional, global and multilateral programming – is delivered. Australia’s commitment to transparent reporting is reflected by its Fast Start Finance Report, four UNFCCC Biennial Reports, regular reporting through the annual Australia’s Official Development Assistance: Statistical Summary Reports, and the 2018 independently-led Evaluation of Australia’s Climate Change Assistance. In March 2020, a United Nations Framework Convention on Climate Change (UNFCCC) co-ordinated team of international experts found Australia’s reporting for the 4th Biennial Report to be complete, transparent and in adherence with UNFCCC reporting guidelines.
Strategies and policies for systematic integration
Australia’s 2017 Foreign Policy White Paper recognised that all countries need to factor climate change into long-term planning and investment. It committed Australia to working in partnership with both developed and developing countries to take effective action on climate change.
Australia’s current development policy, Partnerships for Recovery: Australia’s COVID−19 Development Response (P4R), was released in response to the impacts of the coronavirus pandemic on 29 May 2020. The P4R recognises that the Indo-Pacific region is home to 10 of the 15 countries considered most at risk of disasters and the effects of climate change. Disasters and extreme weather events are likely to compound the effects of the pandemic and undermine efforts to build prosperous, stable and resilient nations.
Australia’s Climate Change Action Strategy (2020-25) (CCAS 2020-25) of 2019, supports the goals of the Paris Agreement to address climate change, while strengthening socially inclusive, gender-responsive sustainable development in the Indo-Pacific region. It recognises that climate change is a major risk to sustainable development and is threatening global efforts to eradicate poverty.
Australia’s development programme further complies with obligations to protect the environment in accordance with the Environment Protection and Biodiversity Conservation Act 1999 (EPBC Act). Australia’s development programme also ensures consistency with other international agreements ratified by Australia, and is committed to the Framework for Resilient Development in the Pacific, which takes an integrated approach to disaster risk reduction and climate action in order to achieve sustainable development outcomes.
Key provisions and pillars
Climate change increasingly affects all Australian development policy and investment decisions and will influence long-term planning and risk management. As a result, climate change is being integrated into Australia’s development assistance, through an integrated approach with disaster risk reduction across all sectors of the Australian development programme.
The Partnerships for Recovery policy sets out how Australia draws on all available resources, including diplomacy, defence, security, commercial links, science capacity and people-to-people ties, to support its development efforts to address the challenges of COVID-19 in the Indo-Pacific. The priority focus is on the Pacific, Timor-Leste and Indonesia. It focuses on strengthening health security, maintaining social stability, and stimulating economic recovery, as the underpinnings of a shared prosperity and the foundations to emerge from this crisis. Based on the objectives set out in the Partnerships for Recovery policy, all bilateral, regional and global programmes prepared COVID-19 Development Response Plans. Australia’s multiple efforts to work with partners in the region to “build back better” also include a focus on low-emissions technology solutions.
Australia’s Climate Change Action Strategy outlines three objectives:
promote the shift to lower emissions development in the Indo-Pacific region
support partner countries to adapt to climate change, and to plan, prepare for and respond to climate-related impacts
drive innovative solutions to climate change, including those that encourage private sector investment, draw on Indigenous traditional knowledge, such as cultural burning and support nature-based solutions.
Moreover, the strategy guides climate-specific activities as well as the integration of climate change through the development programme. Based on the strategy, Australia takes an integration approach to addressing climate change considerations across all stages of policy making and the development programme management cycle. This aims to ensure that all new major investments consider and respond to climate change risks, impacts (especially for vulnerable communities), and opportunities, for low emissions, and climate-resilient development. Australia's climate finance commitment includes targeted climate-specific investments across the development programme and mainstreaming of climate action in key sectors (e.g. clean energy, infrastructure, agriculture, water, health, governance).
Supporting adaptation and building resilience in the Pacific is Australia’s top priority. This is reflected by Australia having invested, on average, over 70% of its bilateral, regional and global climate financing over the past four years in support of adaptation and resilience programmes with the majority benefitting Small Island Developing States (SIDS) and Least Developed Countries (LDCs).
Australia’s approach to adaptation and resilience involves connecting and leveraging action at local, national, regional and international scales to better manage climate risk, protect communities and strengthen the resilience of economies. Australia shares expertise in areas, including governance and planning, economic reform, climate science and meteorology, water, agriculture, infrastructure, disaster preparedness and response, with partners in the region to support their efforts to tackle climate change, to enhance development outcomes, and to achieve the Sustainable Development Goals. Australia considers grant financing and capacity building as playing a critical role in achieving impact in sectors where private finance is not readily available.
Based on the objective of its Climate Change Action Strategy to drive innovative solutions to climate change, Australia is expanding support for “nature-based solutions”. In this regard, Australia will support a range of programmes to pilot different approaches based on nature-based solutions that deliver both biodiversity and human development gains.
Australia recognises that mobilising private finance for climate action is crucial for achieving the Paris Agreement goals and is an important part of promoting an inclusive and sustainable COVID-19 economic recovery. Australia understands that public finance alone cannot meet the investment needs required for the transition over the next decade. Its Department of Foreign Affairs and Trade (DFAT) aims to use public funds strategically to address various barriers to private capital flows to developing countries, with a view to driving innovation and ensuring that infrastructure projects are sustainable and climate resilient.
The DFAT Environmental and Social Safeguard Framework provides for environmental and social safeguard risks to be considered for all new official development assistance (ODA) investments, irrespective of financial value. This includes a screening process using the DFAT Risk and Safeguard Screening Tool to identify whether the investment could increase environmental, climatic and/or social vulnerability and, where necessary, ensure risk management measures are put in place.
Note: “Other environmental markers” include biodiversity, environment and desertification that do not overlap with mitigation and adaptation. Biodiversity-related ODA is integrated in the columns, as well as presented separately for better visibility.
Source: OECD (2021), Creditor Reporting System (database), https://stats.oecd.org/Index.aspx?DataSetCode=crs1
Operational tools for systematic integration
Australia is strengthening organisational capacity to support climate change integration across the development programme and operationalise its integrated approach to addressing climate change considerations across all stages of policy making and the development programme management cycle.
Guidance and key questions to consider in climate programming are included in Australia’s Aid Programming Guide. Australia is also working to update technical guidance and strengthen institutional climate change capability. In this regard, Australia’s DFAT has established a new internal Climate Change, Energy and Environment Toolkit to provide online training for staff on climate change. The Department is also organising a bespoke course for development staff on integrating climate considerations across Australian aid programmes, to be inaugurated in the second half of 2021.
DFAT has also prepared climate change and disaster risk reduction guidance and related sectoral guidance on infrastructure, agriculture and water, as well as guidance on climate finance accounting.
Monitoring, evaluation and learning frameworks
All programme designs are required to include a monitoring and evaluation framework. In addition, all Australian aid investments must meet minimum standards for monitoring and evaluation, to ensure that investment outputs and outcomes can be measured. Independent evaluations – either during implementation or at completion – also play a key role in supporting learning and decision making.
DFAT’s aid management system, AidWorks, includes a climate marker, against which all programme managers are required to update data annually.
Investment design teams are encouraged to include climate technical advice and to draw on current climate modelling in their designs. As far as possible, climate change questions are identified at the programme design phase to ensure climate is integrated through the entire project cycle, including the monitoring and evaluation (M&E) phase. Insufficient access to detailed, country-level climate modelling based on the latest Intergovernmental Panel on Climate Change (IPCC) data limits Australia’s ability to maximise climate integration in some countries and sectors.
Annual investment monitoring reports (IMRs) are the primary vehicle for assessing the effectiveness and efficiency of Australia’s development assistance and mainstream climate progress across all sectors, reflecting a systematic approach.
DFAT is preparing a Performance Assessment Note (PAN) to complement the CCAS with a menu of potential climate-related indicators to assist in establishing M&E frameworks, for which it will seek to draw on the experience of other DAC Members.
Supporting national transition plans that are commensurate with international objectives
Australia’s approach to supporting its partners to develop and take action to implement national transition strategies starts with tailoring its development assistance to meet Indo-Pacific regional or country priorities. Australia does so by engaging at various levels, from national through sub-national, to working with communities directly in helping to address their priority concerns.
Australia’s development assistance supports national Pacific Island governments to meet their Nationally Determined Contributions (NDCs), National Adaptation Plans (NAPs) and other plans to achieve their own transitions to environmentally sustainable, low-emissions and climate-resilient development pathways, including by promoting sustainable, quality, resilient infrastructure.
As part of the Pacific Step-up in 2016 and increased development support to the Pacific, Australia established the Australia Pacific Climate Partnership (APCP) (AUD 75 million from 2017-18 to 2022-23), which supports Pacific governments to deliver climate and disaster resilient development and low-carbon growth by brokering climate and disaster science and information services.
One example of effective climate co-operation is the joint Climate Change Action Plan for Papua New Guinea (PNG) agreed by the Governments of Australia and PNG, which is jointly monitored with annual climate change dialogues attended by senior-level officials. This is proving a useful model in keeping an open and constructive partnership dialogue in monitoring Australia’s climate-related assistance in relation to PNG’s own climate planning and goals.
Australia values the 2016 Framework for Resilient Development in the Pacific: An Integrated Approach to Address Climate Change and Disaster Risk Management (FRDP), which provides voluntary guidelines for the Pacific Island region as a joint Pacific initiative. The FRDP advocates for the adoption of integrated approaches, whenever possible, for coping with and managing climate change and disaster risks. Australia directly finances the Pacific Resilience Partnership (PRP) (AUD 600 000, 2018-22), which was established by Pacific Leaders to oversee implementation of the FRDP.
Australia supports partner countries in the Indo-Pacific region to meet their commitments to the Sendai Framework for Disaster Risk Reduction 2015-2030. More than four in five people currently affected by natural hazards live in the Indo-Pacific. The Sendai Framework places primary responsibility on national governments and local authorities, but recognises that disaster risk reduction is a shared responsibility with all other stakeholders, including communities themselves. The Australian development programme focuses on strengthening the growing capacity of partner countries in the Indo-Pacific region to meet this commitment. In doing so, the aid programme draws on technical expertise from across the Australian Government, such as Geoscience Australia, the Commonwealth Scientific and Industrial Research Organisation and the Bureau of Meteorology.
Multilateral organisations are important partners for Australia in addressing climate change in developing countries. Australia channels some support through institutions such as the Global Environment Facility, the World Bank, the Global Green Growth Institute and the Asian Development Bank, as they provide a single point through which pooled funding can be disbursed. They also host world-leading expertise and development resources while working in close partnership with developing partner governments. Multilateral organisations further play an important role in shaping the rules-based order by providing access to quality research, information and policy advice.
Examples of projects to support national transition plans
Australia’s development assistance supports national Pacific Island governments to meet their NDCs, NAPs and other plans to achieve their own transitions to environmentally sustainable, low-emissions and climate-resilient development pathways. Examples include:
The regional Pacific Nationally Determined Contributions Hub (Pacific NDC Hub) (AUD 500 000, 2018-20; and Phase 2 AUD 500 000, 2021-22) assists Pacific Island Countries and Territories to leverage resources and expertise to implement their commitments to the Paris Agreement through NDCs and achieve low-carbon development. The Hub provides advice and technical support, and promotes regional collaboration to address common issues with NDC implementation across the Pacific.
Australia is also providing AUD 250 million over ten years from 2021 (Solomon Islands Infrastructure Programme) in the Solomon Islands in support of the country’s National Climate Change Policy 2012-17 and the implementation of the Solomon Islands National Adaptation Plans of Action (NAPA) 2008, for resilient economic infrastructure.
At the regional level, Australia has ongoing co-operation on climate change with key Pacific regional organisations, such as the Pacific Islands Forum Secretariat (PIFS), the Pacific Community (SPC), and the Secretariat of the Pacific Regional Environment Programme (SPREP). Australia provides an average of AUD 4.3 million per year in core funding to SPREP, which is mandated as the regional body to lead on the Pacific climate change agenda.
The Resilient Boundaries for the Blue Pacific Project with SPC (AUD 3.5 million, 2019-24) is working to better understand the impacts of sea-level rise and other climate change impacts on the region’s maritime zones and develop Pacific-led technical and legal response options. Australia is working with the Pacific to develop international law to secure maritime zones in the face of sea-level rise.
Implementing the transition to environmentally sustainable, low-emissions and climate-resilient development pathways
The CCAS guides Australia’s work with its partners to realise the goals of the Paris Agreement, and provides a framework to support climate action into the future. The Strategy recognises that addressing climate change in socially inclusive ways through scientifically informed activities that reduce emissions (mitigation), adapt to impacts (adaptation) and strengthen systems (resilience) supports partner countries in maintaining and building on broader development gains. Australia takes a partnership approach in the Indo-Pacific to help Australia’s region reduce emissions and aims to respond to developing country needs and priorities, particularly as reflected in their NDCs, NAPs and other national development plans.
Australia’s investment priorities are determined in consultation with partner governments in the context of broader development planning, and reflect ongoing consultation with civil society, research institutions and other donors operating in a country. Australia’s Annual Climate Dialogue with Papua New Guinea is a good example.
The 2018 Evaluation of Australia’s Climate Change Assistance found that for a country to confidently move forward on its NDC commitments, there needs to be a supportive enabling environment. Each country and regional context is unique and, as a system, presents different entry points and opportunities for external support to effectively contribute to climate change action.
Australia recognises that the creation of governance and regulatory environments that give investors the confidence to invest in developing countries is a critical part of mobilising private finance for climate change. The development programme works with Australia’s partner countries in the Indo-Pacific to identify and address regulatory and other barriers to private investment.
Australia takes a whole-of-government approach to providing support and building the capacity of partner governments. This involves efforts from a range of government agencies and non-government partners that provide specialist expertise in areas that underpin effective adaptive responses to climate change, including climate science and meteorology, governance and planning, economic reform, water, agriculture, infrastructure, disaster risk reduction, preparedness and response. Australia shares this expertise with partner countries in the region to support their efforts to tackle climate change, enhance development outcomes and achieve the Sustainable Development Goals.
In providing this support, Australia aims for a balance between mitigation and adaptation. In practice, Australia has prioritised adaptation and resilience in providing climate finance to Australia’s region, reflecting the strong demand for support in these areas from Australia’s partner countries.
Climate mitigation
Australia’s support for low-emissions development includes capacity building, infrastructure for renewable energy and supporting partner governments’ long-term energy planning. In tailoring its development assistance to meet Indo-Pacific regional or country priorities, and reflecting Australian priorities and strengths, the CCAS prioritises the following areas for transition to lower emissions in the region:
Supporting developing countries in the Indo-Pacific to invest in low-emissions energy technologies. This includes support for increasing renewable technologies, including solar, wind, hydro, biomass, wave and geothermal, in their energy mix and for improving energy efficiency.
Australia has experience in smaller scale, off-grid hybrid systems, transmission technologies and information technology (IT) solutions for grid integration, as well as energy efficiency for industry, buildings, standards and appliances.
Australia seeks to make clean energy technologies scalable, commercial and achievable.
Australia’s development assistance will also target the infrastructure sector, to help address bottlenecks, support improvements in the operating environment and enable the private sector to meet energy needs through low-emissions solutions.
Investing in the land sector and oceans, recognising that many developing country NDCs list the land sector and agriculture as a priority for mitigation.
Australia has experience in managing the land sector and using agriculture technologies, and in measurement, reporting and verification (MRV) systems for land sector emissions reduction.
Best practice is expanding to a stronger whole-of-landscape approach, recognising that significant sequestration occurs in non-forest landscapes such as grasslands, wetlands, peatlands and agricultural lands.
As an island nation, Australia is also helping developing countries protect and restore coastal blue carbon ecosystems such as mangroves, sea grasses and salt marshes, now seen as nature-based solutions. Many of these investments have adaptation co-benefits.
Investing in sustainable cities and transport, given urban areas are projected to produce the majority of future emissions growth.
Australia will share its experience in developing liveable and sustainable cities with Australia’s region, incorporating socio-economic approaches to building community participation, resilience and welfare.
Australia will also focus on skills and technologies for mitigation, including low-emissions building materials, energy efficiencies for buildings, smart and sustainable transport systems, and sustainable water and waste management infrastructure and systems.
Australia recognises the role of energy in supporting sustainable and inclusive economic growth, including through increasing trade and export opportunities. Its assistance focuses on balancing the need to meet energy demands, while shifting to cost-effective renewable energy sources to support developing countries in reaching their targets under the Paris Agreement. Australia’s bilateral and regional development assistance programmes do not support any fossil fuels projects.
Climate adaptation
For more than two decades, Australia has supported adaptation and disaster planning and response through its development initiatives, especially in the Pacific, and will continue to prioritise investments in these areas. Adaptation is a priority for Australia’s region, especially the Pacific, and over 70% of Australia’s global, bilateral and regional climate finance supports adaptation and resilience programmes and focus on SIDS and LDCs.
Australia recognises the need for targeted and tailored approaches informed by countries’ specific circumstances and priorities. In this context, the CCAS notes that Australia’s adaptation investments focus on three key areas:
Governance and adaptive planning, including through partners’ National Adaptation Plans.
Effective adaptation programmes that strengthen community resilience in partner countries, especially for the most vulnerable.
Investments that strengthen adaptation efforts in areas of mutual priority. These include infrastructure; science, research and meteorological support; and agriculture, fisheries and water and nature-based solutions.
Given the context-specific nature of climate risk and the varied adaptation options available, Australia identifies adaptation priorities based on a country-driven approach – with appropriate financial and technical support – and are best articulated in NAPs and associated development plans. At a macro level, adaptation action can work across governance and planning, economic reform, climate science and meteorology, water, agriculture, infrastructure, disaster preparedness and response, and be supportive of, and a part of, sustainable development. Good preparation involves adaptation practice that is data-driven and enables risk-informed decision making, characterised by inclusive processes empowering women, youth, the disabled, and leveraging indigenous knowledge systems.
Australia considers nature-based solutions to commonly offer substantial adaptation co-benefits in strengthening natural eco-systems that provide food security and economic opportunities to communities. This applies to coastal blue carbon ecosystems such as mangroves, sea grasses and tidal marshes, other coastal ecosystems, such as coral reefs, as well as landscapes such as grasslands, wetlands, peatlands and agricultural lands. There will be synergies between the investment priorities for lower emissions and those designed to support adaptation and build resilience, given frequent mitigation and adaptation co-benefits, and the significant adaptation challenges associated with energy and land sectors, forests, oceans and cities. Building community resilience is important in all these areas, particularly to reduce the risk of disasters and other impacts from climate change.
Biodiversity
The CCAS is underpinned by common principles, including strengthening environmental protection and biodiversity. Integrating climate change across Australia’s development assistance policy and programme can achieve other environmental outcomes, such as contributing to biodiversity conservation.
Australia recognises the important role of nature-based solutions to address challenges like climate change, while achieving biodiversity and social benefits. Australia supports a range of initiatives focused on nature-based solutions, including the High Ambition Coalition for Nature and People, which is championing the protection of biodiversity. Australia also leads the International Partnership for Blue Carbon, the Asia-Pacific Rainforest Partnership, and is a founding member of the International Coral Reef Initiative.
Support for sustainable, quality infrastructure
Australia is taking a proactive, evidence-based approach in its bilateral infrastructure support to managing the risks posed by climate change in the construction of infrastructure in the Asia Pacific. For example, Australian support for the Gizo Market (AUD 3.5 million, 2016-19) in the Solomon Islands ensured it was designed to withstand a Category 5 cyclone and resist sea-level rises. It shows how design and construction of facilities can build resilience in the face of increasing climate change threats and natural hazards.
The Australian Infrastructure Financing Facility for the Pacific (AIFFP) provides Pacific countries and Timor-Leste with greater access to capital to support quality, inclusive and resilient economic infrastructure. The AIFFP partners work with Pacific governments and the private sector to design high-impact, safeguarded projects and enable their delivery through up to AUD 1.5 billion in loan financing and up to AUD 500 million in grants. The AIFFP was designed to consider risks posed by extreme weather and natural hazards in assessing proposals, as well as in designing, siting and maintaining infrastructure.
The AIFFP investment portfolio includes the Tina River Transmission Line, which will deliver renewable energy to Honiara generated by the Tina River Hydropower Project. It is Australia’s largest climate finance investment in the Pacific. The project will help the Solomon Islands transition away from diesel-powered energy, strengthen energy security, reduce the country’s exposure to volatile global fuel prices and will enable the Solomon Islands to meet 100% of their Paris Agreement commitment to emissions reduction.
Partnerships for Infrastructure (P4I) is Australia’s flagship infrastructure initiative for Southeast Asia (2020-24). Its goal is to contribute to quality infrastructure development, including energy infrastructure that drives inclusive and resilient growth in Southeast Asia. P4I provides flexible support to Southeast Asian partner governments and the Association of Southeast Asian Nations (ASEAN) through government-to-government partnerships, high-calibre private sector advisory services, and knowledge-sharing and networking activities.
Australia is also an executive member of the Coalition for Disaster Resilient Infrastructure (CDRI), co-chaired by the United Kingdom and India. The Coalition aims to build resilience into infrastructure systems to ensure sustainable development, expanding universal access to basic services and enabling prosperity.
Examples of projects in support of environmentally sustainable, low-emissions and climate-resilient transitions
Australia funds several programmes in support of transitions to environmentally sustainable, low-emissions and climate-resilient development pathways, particularly in the Pacific, including:
Australia is supporting programmes on nature-based solutions, which provide climate change, biodiversity and social outcomes. The Climate Resilient by Nature Initiative (AUD 9.5 million, 2021-23) is a flexible programme that supports a portfolio of community-led activities to address climate change in the Pacific. The Pacific Blue Carbon Programme (AUD 6 million, 2018-24) aims to protect and restore blue carbon ecosystems for climate mitigation, climate adaptation, biodiversity and livelihood benefits.
The Australian Centre for International Agricultural Research (ACIAR) leverages international agricultural partnerships to support research that helps improve the productivity and sustainability of agricultural systems in developing countries. ACIAR’s Strategy for 2018-27 includes climate change adaptation and mitigation as well as building capacity in partner countries. ACIAR’s new Climate Change Programme is dedicated to supporting developing countries in the Indo-Pacific region to take more ambitious, transformational action on climate change adaptation and mitigation.
Through the Exporting Traditional Fire Management initiative (AUD 3.85 million, 2017-21), Australia is sharing traditional indigenous fire management practices. The approach harnesses traditional knowledge combined with satellite technology to reduce greenhouse emissions, improve land management, and provide economic benefits through international carbon markets revenue. This technology is initially being exported through a pilot in Botswana’s Okavango Zambezi region, among the most affected areas in the world by savannah fires.
Private Financing Advisory Network (PFAN) is a global network of climate and clean energy financing experts that facilitate developing climate and clean energy projects in emerging markets. Since 2006, PFAN has raised over USD 2 billion in financing for 155 projects, adding 1.2 megawatts of clean energy generation capacity and avoiding over 4 mega tonnes of carbon emissions per annum. Australia supports PFAN to identify and mentor clean energy and climate entrepreneurs and connects them to private investors to address the lack of high-quality investment pipelines, a key challenge in scaling climate finance in developing countries.
Responding to the particular needs of SIDS
While all countries will feel the effects of climate change, developing countries, particularly SIDS and LDCs, are both more exposed and more vulnerable, and have fewer support systems and less capacity and resources to withstand shocks. They are at greater risk because of a lack of access to climate data, research and technology. All the Pacific Island Countries (PICs) that Australia supports are SIDS and are especially vulnerable to the impacts of climate change.
Australia’s development assistance includes a dedicated climate finance commitment of AUD 500 million for the Pacific from 2020 to 2025. Australia exceeded its 2016-20 climate finance commitment to PICs in providing AUD 408 million to build the resilience of social infrastructure, support renewable energy solutions, improve water and food security, reduce the health impacts of climate change, and strengthen disaster response systems.
The OECD DAC’s peer review of Australia’s aid programme (March 2018) noted Australia’s advocacy for responses to unique challenges faced by SIDS, and its effective use of regional and multilateral channels to exert influence on channelling support to the Pacific, a continuing area of support.
Examples of projects in support of SIDS’ sustainable development
Pacific SIDS have been the focus of Australia’s development assistance for some time, and several projects have been highlighted above. More information on Australian climate support provided to the Pacific may be found at https://www.dfat.gov.au/geo/pacific/development-assistance/climate-change-and-resilience.
In addition, Australia has supported the participation and training of Pacific women in climate-related negotiation processes through the Pacific Women Climate Change Negotiators Training (AUD 1.4 million, 2017-21), which has seen an increase in Pacific women delegates attending UNFCCC negotiations.
Australia supported a Community-Based Adaptation Programme through the United Nations Development Programme (UNDP) and the Global Environment Facility (GEF)’s Small Grants Programme (SGP) with AUD 12 million from 2009 to 2020, which worked in 41 countries, most of which were SIDS. The programme provided small grants for community-designed projects across diverse sectors, including agriculture, water, livelihoods and tourism, which helped build community resilience. Several projects contributed to revisions to national/sub-national policy revisions and development.
Supporting SIDS’ access to finance
Australia is supporting SIDS to access climate finance through several initiatives, including:
The AUD 140 million Australian Climate Finance Partnership (ACFP) seeks to accelerate private sector investment in low-emissions, climate-resilient solutions for the Pacific and Southeast Asia. The ACFP is managed by the Asian Development Bank and aims to crowd-in additional climate finance across the Indo-Pacific.
Australia has funded a blended finance platform, Convergence, to create an AUD 3.3 million Indo-Pacific window that provides grants for the design of innovative, blended-finance structures for climate and is expected to mobilise AUD 300 million from private and public investors. It has funded the design of three climate finance transactions (AUD 870 000) for renewable energy investment and climate-resilient, small-scale infrastructure in the Pacific. These design-stage investments are expected to leverage AUD 216 million in blended capital.