Financing

The Asia Pacific Region will require billions of dollars to transition to low-carbon growth paths and adapt to the unavoidable impacts of climate change. To respond to this challenge, ADB's climate change initiatives are improving access and creating incentives for financing and investments. Their aim is to help make mitigation and adaptation actions more competitive and affordable to developing countries. ADB mobilizes financing to complement our own resources, including external concessional resources, financing from market mechanisms such as the carbon market, and private sector capital.

Concessional and grant resources

Clean Energy Financing Partnership Facility (CEFPF)

The facility is a financing and knowledge resource mechanism aimed at improving energy access and security in developing member countries (DMCs). The mechanism assists the DMCs in their transition to low-carbon use through cost-effective investments, especially in technologies that result in greenhouse gas (GHG) mitigation. The facility’s resources also finance policy and institutional reforms, as well as regulatory frameworks that encourage clean energy development. It is designed to support technical assistance projects, grant components of investment projects, concessional financing, direct charges, and other activities that may be agreed upon between the financing partners and ADB. More

Contact: Aiming Zhou, RSID, Email contact form

Climate Change Fund (CCF)

The purpose of the fund is to facilitate greater investments in developing countries in Asia and the Pacific to address the causes and consequences of global warming. The fund provides grant financing for technical assistance, investment projects, research and other activities. More

Contact:
Overall: Preety Bhandari, RSDD-CD, Email contact form
Mitigation (Clean Energy and Transport): Aiming Zhou, RSID, Email contact form
Mitigation (REDD and Land Use): Bruce Dunn, RSID, Email contact form
Adaptation: Cinzia Losenno, RSES, Email contact form

Global Environment Facility (GEF) funds

ADB has direct access to the GEF’s full project resources. GEF funds are helping developing countries take on "win-win" projects to mitigate the effects of climate change, while also benefiting local economies and helping improve local environmental conditions. GEF funds also support interventions that increase resilience to the adverse impacts of climate change on vulnerable countries, sectors, and communities. The GEF also manages two separate adaptation-focused Funds under the UNFCCC that mobilize funding specifically earmarked for activities related to adaptation -- the Least Developed Countries Fund (LCDF); and the Special Climate Change Fund (SCCF), which also mobilizes funding for technology transfer. More

Contact : Bruce Dunn, RSID, Email contact form

Climate Investment Funds (CIF)

These two trust funds are administered jointly by the World Bank, ADB, and other regional development banks. The Clean Technology Fund (CTF) provides new, large-scale financial resources to invest in projects and programs in developing countries that contribute to the demonstration, deployment, and transfer of low-carbon technologies. The Strategic Climate Fund (SCF) serves as an overarching fund for various programs to test innovative approaches to climate change. More

Contact: Preety Bhandari, RSDD-CD, Email contact form

Adaptation Fund (AF)

The Adaptation Fund was established in 2009 to finance concrete adaptation projects and programs in developing countries that are Parties to the Kyoto Protocol. The fund works to reduce the adverse effects of climate change that are impacting vulnerable communities, countries and sectors by strengthening their resilience to these impacts. In June 2010, ADB was accredited by the AF Board as one of the multilateral implementing entities (MIEs) of the AF. More

Contact: Cinzia Losenno, RSES, Email contact form

Market-based mechanisms

Carbon Market Program

The Carbon Market Program (CMP) is one of ADB's flagship initiatives to mitigate climate change under its overall Climate Change Program. It helps developing countries in Asia and the Pacific benefit from the Clean Development Mechanism (CDM) and new carbon market mechanisms by providing financing and technical support. CMP's Asia Pacific Carbon Fund (APCF) and Future Carbon Fund (FCF) co-finance CDM projects by securing a portion of the expected future certified emission reductions (CERs) from the projects in exchange for upfront finance.

APCF purchased CERs up to 2012 when the first commitment period of the Kyoto Protocol ended, while FCF purchases CERs beyond 2012 up to 2020. The $151.8 million-APCF, which closed in August 2013, supported 71 CDM projects in 9 DMCs, delivering 15.63 million contracted CERs to APCF. APCF’s investments contributed a total of 1,886 MW of renewable energy.

As of July 2014, FCF has contracted 29 CDM projects for the purchase of 8.43 million CERs with a total expected investment of $53.60 million, approximately 47% of the total fund size. CMP’s Technical Support Facility (TSF) provides project development and capacity building support.

Contact: FCF, TSF Virender Duggal, Email contact form

Private finance

ADB spurs private finance to flow into climate-friendly investments using a variety of financial instruments and innovative approaches. These include combining finance from different sources and public-private partnerships.

Canadian Climate Fund for the Private Sector in Asia under the Clean Energy Financing Partnership Facility

The fund, established in 2013, is ADB’s first concessional debt co-financing facility specifically oriented to support private sector operations to combat climate change. It provides concessional co-financing to select select private sector projects that do not benefit from a sovereign guarantee and require some financing on concessional terms to be viable or acceptable from a risk-reward perspective. It also provides grants to improve the enabling environment for private sector investments in climate mitigation and adaptation projects. More

Private Equity Funds

ADB serves as a catalyst by identifying and supporting fund managers willing to establish clean energy-focused private equity funds. Examples are the China Environment Fund III, South Asia Clean Energy Fund, Asia Clean Energy Fund, and Mekong Brahmaputra Clean Development Fund.

Seed Capital Assistance Facility

The recently established Seed Capital Assistance Facility (funded by a $4.2 million grant from the Global Environment Facility) is providing technical assistance to private equity fund managers and entrepreneurs to develop sustainable clean energy funds and financing for the early stages of such projects.

In parallel to this and other future initiatives, there is the need to continue scaling up direct investments to address climate change by ADB's Private Sector Operations Department, particularly in addressing early stage financial and skills gaps of clean energy project managers in developing countries. SCAF website