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C40 COP26 Daily Briefing
Week 1
Looking back at Wednesday, 3 November, 2021
Welcome to C40 COP26 Daily Briefings, a new C40 service to inform you of what's happening at the 26th UN Conference on Climate Change taking place in Glasgow, Scotland from October 31 to November 12, 2021. This daily COP26 briefing recaps the activities and announcements of the day and lets you know what's coming up the following day to ensure you are kept fully up to date on all COP26 discussions. You are receiving this email because you are a C40 member, or a C40 partner, or have joined the Cities Race to Zero campaign. If you do not wish to receive our emails, please unsubscribe using the link at the bottom of this briefing. We hope these briefings will help you understand what's at stake at COP26. Happy reading!
What happened in the formal COP26 intergovernmental process?
  • 3 November was Finance Day at COP26. Issues of accountability and credibility were in the spotlight, as significant new private sector net-zero commitments were announced. The large number of major private sector initiatives announced (see below) indicate a promising shift towards ‘mobilising the trillions’ needed to finance the transition to net-zero. However, questions have been raised over the integrity of these commitments, as well as concerns over the continued challenges in accessing private finance faced by developing countries.
  • Access to finance emerged as a prominent topic, alongside finance for adaptation, in country and private sector commitments. The negotiated decision texts will need to find a place to reflect the rising priority of access to climate finance for developing parties, and to find the vehicles and solutions for resolving this challenge. This is also a key issue for cities. 
Finance pledges
  • The Delivery Plan presented on 25 October signaled that the US $100 billion pledge for developing nations to fight and adapt to climate change would not be reached until 2023. COP26 has since seen many climate finance pledges from countries to UN funds and new bilateral commitments. Italy and the UK made some efforts, but in general we are still far from the level required to meet the threshold of 1.5 °C. It remains difficult to evaluate whether pledges will be met in 2022, as there is still not enough clarity or understanding on what could count and what these funds would be used for.
  • Australia pledged AU $500 million - on top of AU $1.5 billion previously announced - and committed to double its previous five-year commitment. Belgium pledged €455 million between 2021-2024 and Finland announced that it will allocate approximately €900 million during the period of 2020-2025, with the aim of scaling up finance for adaptation. Although these amounts are welcome, Australia has one of lowest shares of climate finance as a proportion of Gross National Income (GNI) and neither Belgium nor Finland's contributions are aligned with their fair share. 
  • Italy increased its climate finance contribution to US $1.4 billion per year for the next five years and is getting closer to its fair share contribution to the US $100 billion.
  • The UK announced a further £1 billion in climate finance, bringing the total to £12.6 billion over 2021-2015. It will also add £100 million to the Task Force on Access to Climate Finance, making it quicker and easier for Global South countries to access the finance they need. For its pilot phase, the Task Force will work with Fiji, Rwanda, Jamaica, Uganda, and Bangladesh. These announcements remain, however, shadowed by the decision to cut UK foreign aid to 0.5% of GNI. 
  • City access to climate finance is at the heart of C40 finance advocacy, so we will be looking with interest at how cities are  included - or not - in these efforts.
 Negotiations
  • Developing countries have been  increasingly vocal throughout the negotiations related to the post-2025 goal and the guidelines for accessing funding facilities, such as the Green Climate Fund (GCF) and the Global Environmental Facility (GEF) in asking for solutions to improve access to climate finance.
  • Positions are divided with respect to the Global Stocktake (the process due to take place in 2023 that will assess the world’s collective progress towards the implementation of the Paris Agreement), as some developing countries argue the stocktake must encompass priorities such as equity, response measures, needs-based assessments, adaptation, and loss and damage finance.
What did cities do in Glasgow?
  • During the C40-led Cities Race to Zero session at the Multilevel Climate Action Pavilion, C40 mayors from London, Barcelona and Freetown exchanged thoughts and ideas with COP25 President, Carolina Schmidt, about the impact of the aggregated ambitious and equitable city climate actions from Cities Race to Zero signatories on global climate policy, and the COP negotiations in particular. A finance roundtable was held between the mayors of Dubai and Phoenix and the Presidents of the European Bank for Reconstruction and Development (EBRD) and the Development of Bank of Minas Gerais (Brazil), about the financial challenges encountered by cities in the implementation of their ambitious climate action plans, as well as the solutions that are - or should be - delivered by the financial sector.
  • The UK Cities Climate Investment Commission (UKCCIC) launched a report that calls for ‘place-based demonstrators’ or neighbourhood pilots where green investment opportunities can be gathered together as a package to attract returns in the form of savings, additional revenue streams, and other social and environmental benefits. On this occasion, Mayor LaToya Cantrell of New Orleans spoke of the importance to invest in net-zero, resilient projects and infrastructure in cities. 
  • For more information on the activities of Local Governments and Municipal Authorities (LGMA)  in Glasgow, please visit www.cities-and-regions.org (in partnership with ICLEI).
Other announcements/updates?
  • The Race to Zero now includes 5,235 businesses, 67 regions, 441 financial institutions, 1,039 education institutions, and 52 healthcare institutions - all committed to halving emissions by 2020 and 2030. 1049 cities are part of the Cities Race to Zero
  • The launch of the Glasgow Financial Alliance for Net Zero (GFANZ) received mixed reactions:
    • The GFANZ now counts over 400 members, reportedly accounting for over US $130 trillion Assets Under Management (AUM) across all major segments of the finance sector, including asset owners, asset managers, insurers, commercial banks, investment consultants, stock exchanges and credit rating agencies. Each of these financial institutions has committed not only to achieve net-zero before 2050, but also to set near-term, science-based targets aligned with 1.5°C and net-zero. While the exact asset portfolio covered is up for debate, the alliance does bring a significant amount under science-based net-zero commitments (including interim targets, a ratchet mechanism, and good elements on disclosure and reporting) which could catalyse action and ambition across the financial sector. Michael R. Bloomberg was announced as the GFANZ co-chair, along with Mark Carney, the current UN Special Envoy for Climate Action and Finance (and previous Governor of the Bank of England). 
    • Mark Carney’s assertion that ‘the money is here and available’ was particularly criticised for miscommunicating or disregarding the significant challenges to accessing finance for developing countries, creating a lot of confusion on the gap left to bridge. The initiative also faced criticism for not including requirements for signatories to end fossil-fuel financing in line with the International Energy Agency (IEA) net-zero scenario.
    • GFANZ has fairly strong representation from the Global South, especially from Latin America, but a concerted effort is needed to increase its membership across financial institutions in Asia, Africa, and Latin America, to ensure it is truly representative of the global financial system and so that it gives leaders from across different regions a seat at the table.
  • Ten multilateral development banks (MDBs) issued a joint climate statement which - while short on specific new commitments - outlines their climate finance track record and highlights areas for raising ambition  including adaptation, private finance mobilisation, nature and gender-smart solutions, decommissioning coal and other high-greenhouse gas emission systems, and carbon pricing. It also reflects progress in aligning their financial flows with Paris Agreement goals. The statement makes a specific reference to MDBs working to accelerate climate finance for cities.  It also signals the potential establishment of a joint MDB long-term strategy facility to support countries in the formulation of robust and ambitious long-term strategies.
  • The launch of the African Green Finance Coalition will help African countries work together to build capacity, credibility, and opportunities for green investment across the continent. This enables African countries to look beyond aid and tap into the shift in financial markets towards sustainable and resilient investment.
What's coming up today?
  • C40 will release its Just Transition and Energy Crisis statement that aims to demonstrate the leadership of cities, unions, and businesses on a key issue related to just transition: energy poverty. The statement will bring forward key asks to national governments and will create a stepping stone for a strong united front between mayors, workers, and the private sector to reduce energy poverty and ensure a just transition. 
  • HRH The Prince of Wales will host a reception with mayors and senior delegates from cities at Kelvingrove Art Gallery and Museum in Glasgow. The event is part of HRH’s Terra Carta initiative that offers the basis of a recovery plan that puts nature, people and the planet at the heart of global value creation. 
  • During Energy Day, the Marrakech Partnership for Global Climate Action (MPGCA) - the UNFCCC mechanism supporting the implementation of the Paris Agreement by enabling cooperation among non-state actors - will showcase the Climate Action Pathway on Energy and explore how the global energy transition can help deliver a climate-safe future. C40 Vice-Chair, Mayor Yvonne Aki-Sawyerr of Freetown will bring the voice of cities in this conversation.
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