ADB launches new carbon fund to incentivise climate investments
The Climate Action Catalyst Fund will help ADB’s member countries meet their nationally determined contribution (NDC) targets and raise ambition over time
The Asian Development Bank (ADB) this week launched a new carbon fund, the Climate Action Catalyst Fund (CACF) at COP26.
The CACF will help ADB's member countries meet their nationally determined contribution (NDC) targets and raise ambition over time, said a press release by the bank on Wednesday.
It will mobilise carbon finance through the purchase of internationally transferred mitigation outcomes, or carbon credits, under Article 6 of the Paris Agreement to enhance the financial viability of greenhouse gas (GHG) mitigation actions in Asia and the Pacific.
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"Establishing the CACF is another major step by ADB toward ensuring that the Asia and Pacific region benefits fully from the emergence of carbon markets under Article 6," said ADB Vice-President for Knowledge Management and Sustainable Development Bambang Susantono.
"The battle against climate change will be won or lost in Asia and the Pacific, so it is critical that developing member countries (DMCs) have access to finance to achieve their NDC targets and to transition toward net-zero emission economies," Susantono added.
The CACF is aiming to mobilise more than $100 million from national and subnational governments or their agencies, as well as from public and private sector entities in ADB's member countries for catalysing investments that are essential for meeting the objectives of the Paris Agreement and the Sustainable Development Goals.
It will support a diverse range of transformative actions including GHG emission reduction projects, programs, and scaled-up activities such as sectoral and policy interventions, the press release added.
