Options for embedding Article 2.1c in the New Collective Quantified Goal on climate finance
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Article 2.1c, the third long-term goal of the Paris Agreement, recognises the full effort needed to finance climate change adaptation and mitigation. It seeks to both scale up finance for climate action, and scale down finance for high-emitting and resilience eroding actions. Despite being established in 2015, the lack of a shared understanding of what this climate-consistent finance goal entails, how to measure it, or how responsibility for its achievement will fall on nation states or private actors has hindered discussions on how to turn this goal into practice, as well as how climate finance mobilised and provided by developed countries can support developing countries to pursue this objective of the climate-consistency of all finance flows with low-emission, climate-resilient development pathways.
This working paper seeks to identify concrete ways in which the objectives of Article 2.1c, the climate consistency of finance flows, form part of the New Collective Quantified Goal (NCQG) on climate finance, which will be set at the end of 2024 and for which dialogues are already underway. It outlines the challenges to operationalising Article 2.1c, as well as suggestions for how to overcome them. Finally, it proposes five options for including climate consistency in the new climate finance goal deliberations and decisions. With two years remaining of the NCQG technical expert dialogues, this working paper is intended to stimulate discussion that will evolve as deliberations and wider guidance on the operationalisation of Article 2.1c progresses.