The importance of local government actions for tackling climate change
The importance of sub-national or local government actions for tackling global climate change and for building sustainable societies is well recognized. It is now overwhelmingly clear that local and sub-national governments have a critical role in building low-carbon climate-resilient societies, and that many of these local government efforts to reduce GHGs and promote green societies are more ambitious than national government efforts. However, it is only recently that we start to see solid data that quantitatively demonstrates sub-national efforts’ towards national government and global climate change mitigation.
The United Nations Environment Programme (UNEP) estimates that cities are responsible for 75 percent of global CO2 emissions, thus it is essential to make urban areas an indispensable part of the solution to fighting climate change. A 2015 Yale report (Scaling Up: Local to Global Climate Action)[1] assesses sub-national climate mitigation programs from eight countries, and concludes that these eight sub-national programs could reduce 2020 emissions by 1 gigaton. The report further states that if adopted by their respective countries, these eight sub-national climate actions could narrow the emissions gap by 10 percent.
With solid statistics backing up the important climate change contributions that cities and sub-national governments make, it is clear that one of the most efficient avenues for tackling climate change and for building low-carbon societies is to invest in low-carbon urban development. This is especially important when we take into account that 66 percent of the world’s population will live in urban areas by 2050.[2]
However, many cities and local governments do not have sufficient budgets to incorporate all the renewable energy, energy efficiency, clean public transport or waste management programs that experts suggest to them. They therefore turn to the private sector. With so many cities competing for private sector financial resources, they have to make themselves stand out from the crowd. By showcasing their commitments and targets, publicly reporting their low-carbon actions, and utilizing certification standards to quantify development outcomes, cities and local governments can demonstrate to investors that they are serious about unlocking finance for even more low-carbon urban development.
Measuring and Reporting at jurisdictional level in order to attract finance and recognition for low-carbon urban development
Many sub-national governments (cities, states, provinces, etc.) are now actively sharing their climate change actions, commitments and GHG inventories on public, online databases. The goal is to increase visibility, gain recognition and allow for comparability between cities, as well as to attract finance. By opting to publicly disclose information on climate actions, local authorities are showing that they have the political ambition and are serious about lowering GHGs and building sustainable societies. They can also highlight which specific projects or programs need finance.
A 2016 report from Carbon Disclosure Project (CDP) showed that 533 cities disclosed their climate-related data, and that of those cities, 277 are seeking private sector involvement on 720 climate-related projects worth US $26 billion.[3] According to the Carbonn Climate Registry, as of 2015, over 92% of the reported implemented actions of local governments are financed through local, subnational and national sources, but additional financing is needed.[4]
Many local governments are using tools or protocols for quantifying and preparing GHG inventories. When reported, these inventories are very helpful for measuring the contribution of city’s mitigation actions to regional or national GHG emission reduction targets, or to attract private sector attention. However, many cities do not have this data verified, or if it is, the verification is not done by an independent third party, which lessens credibility and confidence in the outcomes. In addition, GHG inventories do not tell the full story of a city’s ambitions towards tackling climate change. This is where certification standards for urban interventions can be extremely helpful: in addition to verifying GHG emission reductions, independent third-party auditors can simultaneously verify the sustainable development outcomes of multiple urban interventions (projects, programs, actions), thereby allowing for certified claims and products, but with reduced monitoring costs for local authorities.
The importance of certification standards for multiple urban interventions: creating value and lowering risk through MRV
Many cities are aggressively pursuing climate change actions with the primary objective of better and cleaner environments for their citizens and to build sustainable societies. Consider the demands for better air quality in many Chinese cities, or the better living conditions created by efficient transport. MRV can play an important role in helping to attract additional finance for climate change mitigation and adaptation by adding another level of confidence, namely the verification component. In addition, some investors request certified outcome statements (eg. contribution to specific Sustainable Development Goals). Knowing that urban climate change projects or programs have been scrutinized by third-party auditors and that GHG emissions and sustainable development outcomes have been quantified reduces the risk of false claims about positive project benefits and makes a particular jurisdiction less risky to investors.
Indeed, the investment community is increasingly concerned about “green washing” or “SDG washing” through false or exaggerated claims made about the positive impacts their projects are making towards the Sustainable Development Goals (SDGs). In fact, an August 2016 article in Responsible Investor quotes a senior advisor in a Dutch pension fund as saying,
Unless it is measured, supporting impacts is a little too easy.
Thus, certification against a high quality standard for urban climate interventions can verify GHG reduction claims as well as the interventions’ contribution towards the SDGs. By so doing, these interventions become more attractive to investors – ultimately helping cities transform from ‘business as usual’ to sustainable and more prosperous urban environments.