Climate Finance: The Solution to All Climate-driven Ills?
Statistics reveal that the world’s top 1 per cent of emitters produce over 1,000 times more CO2 than the bottom 1 per cent. That number gets starker, as studies reveal, with the richest 0.1 per cent of the world’s population emitting 10 times more than the entire top 10 per cent combined. These figures make one thing explicitly clear: if these top emitters globally continue to maintain such carbon levels, there is no way we can decarbonize fast enough.
With COP28 on the horizon, organisations around the world are assessing the progress and challenges in the climate mitigation process. As we know, the Paris Agreement rolled out a framework for developed nations to provide financial, technical, and capacity-building support to the countries that need it. This framework is what gave rise to the concept of climate finance.
The United Nations Framework Convention on Climate Change (UNFCCC) defines climate finance as local, national, or transnational financing that helps countries reduce greenhouse gas emissions by funding renewable power such as wind or solar. The uptake of solar power as a renewable resource was slow to begin with due to large upfront costs and availability issues. Over time, however, after governments began awarding tax credits to industries for adopting solar energy systems, an increase in production and government subsidies led to a decrease in the direct costs of solar energy for consumers.
Today, renewable energy is more cheaply produced than fossil fuels in some markets. Due to the increasing competition in the solar energy industry, installation costs have also seen a sharp decline, making it a fiscal win for both consumers and large companies globally. Another form that climate financing takes is
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