Bilateral cooperation in climate finance

Apart from the climate specific financing instruments, German funding for international climate change financing flows largely through projects in “traditional” bilateral development cooperation (DC) – at least in certain DC sectors. For realization and funding, the implementing agencies are responsible for DC in both areas:

  • technical cooperation (TC) via the Society for International Cooperation (Gesellschaft für internationale Zusammenarbeit, GIZ)
  • and financial cooperation (FC) through the KfW Development Bank.

A clear-cut distinction between climate and development activities at the project level is hardly possible. In general, measures are considered to be climate-related if they pursue one of the following objectives:

  1. The projects and measures contribute to adaptation to the impacts of climate change. Numerous “traditional” development projects of bilateral financial and technical cooperation in the sectors of agriculture, water, and health can be categorized as such.
  2. The projects and measures contribute to reducing emissions (“mitigation”). These include all measures in the energy sector related to promoting renewable energy and energy efficiency.
  3. The projects and measures contribute to the protection of forests and biodiversity. Such measures help preserve the rain forest and other natural carbon sinks, and can thus be considered a reduction of emissions in a broader sense. In a narrower sense, these measures belong to the REDD+ (Reducing Emissions from Deforestation and Forest Degradation) category.

The BMZ is publishing project lists in German on German climate finance via the bilateral financial and technical cooperation since the  funding year 2010. These lists contain all projects, implementing agencies, financial volume and sectoral allocation. The project lists include all fast start finance projects as well as all other climate-related projects of German development cooperation. Since 2012 these lists are available as Excel files.

The accounting of the projects towards German climate finance first happened in 2010 based on experience. Since 2011 the accounting is done on the basis of the OECD Rio Markers using the following system:

Die Anrechnung der Projekte auf die deutsche Klimafinanzierung erfolgte 2010 anhand von Erfahrungswerten. Seit 2011 werden die Projekte auf Basis der Rio-Marker und nach dem folgenden System angerechnet:

  • For a project with a Rio-Marker of 2 for mitigation or adaptation, the full amount is accounted towards the respective sector.
  • For a project with a Rio-Marker of 1 for mitigation or adaptation, 50 percent of the amount are accounted towards the respective sector.
  • For a project with a Rio-Marker of 2 for biodiversity, the respective amount is accounted towards the sector forest and biodicersity protection including REDD+.