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Overview: about the EBRDWho we are
Overview: about the EBRD
Our story
Explore the EBRD’s journey over the decades, investing in businesses, supporting economies and driving lasting change across its regions.
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Overview: how the EBRD operatesWhat we do
Overview: how the EBRD operates
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Across three continents, the EBRD supports the transition to successful market economies.
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Light
Eng
Eng
Climate Initiatives
June 2019
Background
Recognition of climate change as a major global public policy challenge has grown since key concerns were raised in 1992. A comprehensive framework was agreed in Paris in 2015 based on enforceable country-level commitments to carbon targets. Developed countries were urged to mobilise US$100 billion annually by 2020 from multiple sources to be channelled through the Green Climate Fund and complement other funding. Against this backdrop, EBRD substantially increased the strategic priority to be given to work on sustainability. The Sustainable Energy Initiative was approved in 2006 and subsequently widened beyond energy. The ‘Green’ transition quality was introduced as a transition priority, and the GET initiative of 2015 committed to a sharp increase in green finance as a share of bank investment. This evaluation focuses principally on their climate dimensions and for this reason refers to them collectively as the Bank’s Climate Initiatives.
Main findings
The study found that the Bank had become a leading multilateral development bank (MDB) implementing global climate agreements and was competing effectively for the external concessional resources critical to delivery. It had achieved all its targets for financial volumes and transition benchmarks, while portfolio financial performance compared favourably with the Bank’s overall portfolio. Investment is largely denominated in foreign currency. The study found opportunities for improvement in several areas.
Metrics, evidence and data adequacy: No verification of forecasts is available; monitoring, reporting and verification is limited to ex-ante estimates of expected savings. The Bank’s Energy Efficiency and Climate Change team (E2C2) indicates that it samples projects to verify ex-ante estimates, but there is no reporting process or documentation in place. The Bank’s environmental and economics teams collect ex-post data for selected projects, but figures are not compared to ex-ante estimates.
Internal incentives: There are clear incentives to achieve the GET target of 40 per cent of EBRD annual business investment, but the performance management framework, staff incentives and resourcing are not focused on actual results at an operational or programmatic level.
Use of TC funds: Project-level data are patchy and not reconcilable with other reporting systems. TC funds are not targeted at the types of projects achieving the highest greenhouse gas savings per euro of finance.
Country-level issues: There is no country detail on adaptation requirements, carbon budget, baselines or target. There is little incentive to target greenhouse gas savings at the country level; country plans in support of Nationally Determined Contributions do not yet exist. Funding for policy advice appears to be prioritised more by prospective lending than by country needs.