Oct. 22 (Bloomberg) -- Financing of projects that reduce carbon emissions and protect against the effects of climate change fell 1 percent last year, hampering efforts to slow global warming, according to a research report.
Spending from governments and companies on renewable energy and other mitigation measures declined to $359 billion in 2012 from $364 billion a year earlier, according to the study by the Climate Policy Initiative, a San Francisco-based analysis firm.
The total, which includes business-as-usual spending on low-carbon projects as well as supplementary financing, is less than 60 percent of what the International Energy Agency says is needed above normal energy-investment levels to stem emissions fast enough to meet United Nations temperature targets.
“Investment to combat and adapt to climate change is happening around the world, but it’s short of where it needs to be and efforts to grow it have not been successful enough,” Climate Policy Initiative Executive Director Thomas Heller said in an e-mailed statement.
The IEA said last year that $5 trillion is needed through 2020 to moderate temperature gains since industrialization to 2 degrees Celsius (3.6 Fahrenheit), a UN target. That’s on top of a projected $19 trillion of spending by the energy industry in a business-as-usual scenario, and is equivalent to an extra $625 billion a year for eight years.
The CPI’s estimates “are almost certainly more business-as-usual than not,” suggesting the shortfall is even greater, Barbara Buchner, a director at the initiative, said in an e-mail.
The World Bank estimates that on the current trajectory of carbon emissions, the planet is set to warm by 4 degrees.
The money includes $337 billion directed at efforts to lower emissions and $22 billion for projects to help adapt to the effects of a warmer planet, according to the study. More than half the funds -- $182 billion -- were spent in developing countries, while 76 percent of all spending was domestic.
About $224 billion of the spending was by non-state corporations and the rest was from governments. The researchers didn’t include any financing by companies for adaptation measures, citing “data limitations.”
The researchers said $39 billion to $62 billion of spending was from industrialized nations to developing countries. That estimate shouldn’t be compared with a separate pledge by richer nations to channel $100 billion a year in climate aid to poorer countries by 2020, the authors said.
Christiana Figueres, executive secretary of the UN Framework Convention on Climate Change, which guides international treaty talks, said yesterday that the next round of talks that start in Warsaw on Nov. 11 must clarify where the $100 billion will come from. The Green Climate Fund set up by envoys to channel some of that money will be ready for an initial capital raising in the first half of next year, she said.
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