Banking institutions dedicated to funding renewable energy initiatives to solve climate change have invested $ 24,000 million from three promoters, according to the report.
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According to the report by the UK Banks Green Finance Institute of the United Kingdom and the United States Council for the Defense of Natural Resources along with the American Rocky Mountain Institute, the initiative of these banks attracts an average of two dollars in private investment for every dollar invested from their own resources .
There are currently credit institutions classified as green banks in 12 countries: Switzerland, South Africa, the United Kingdom, Norway, New Zealand, Malaysia, Japan, India, the United States, the United Arab Emirates, Bulgaria and Australia.
However, there are also 25 other countries that are driving the development of this type of financial institution, including four Latin American countries such as Brazil, Mexico, Chile and Colombia.
Climate-resilient investments such as renewable energy systems, more efficient buildings or less carbon-intensive cement and steel require strong capital support / Image: Depositphotos.com
Green banks act as providers of resources, as well as attracting investment in low carbon technologies and supporting global efforts to meet the goals of the Paris Agreement arising from the global threat to Climate change Maintaining temperature, reducing greenhouse gas emissions through abatement, adaptation and resilience of ecosystems. It is worth noting that the mobilization of funds is the third step of the agreement. All phases are necessary to be successful.
The green benches aim to help overcome market barriers, to rely on risk-reducing financial instruments, to attract concession financing and equity related to certain contributions at national level, as indicated in the agreements Paris Agreement.
Climate-resilient investments such as renewable energy systems, more efficient buildings or less carbon-intensive cement and steel require strong capital support.
However, generating electricity on the supply side will require between 1.6 and 3.8 trillion annual investments between 2016 and 2050. That number is higher than the $ 546 billion invested in 2018.
Whether the green banks are public, private, or mixed, they require strong capitalization, which can come from government funds, bilateral external assistance, banks, multilateral development funds and private sector sources.
A previous survey of banks in 36 countries found that institutions looking to move forward as green banks propose to mobilize $ 3 to $ 5 in private investment for every dollar they invest in climate resilience projects.
It is important to know that the growth of green banks is an important development path for the recovery of the environment. Pension funds and national capital funds can also be used to capitalize on green banks that provide investment opportunities and the development of financial products.