This post is part of WRI’s blog series, The Trump Administration. The series analyzes policies and actions by the administration and their implications for climate change, energy, economics and more.
With a new administration in the White House, and the secretaries of State and Treasury now confirmed by the Senate, there are big questions about the future of U.S. climate finance. On the campaign trail, President Trump said he would cancel payments to “UN climate change programs.” Meanwhile, many newspapers noted that almost all references to climate change were removed from the White House website within minutes of Trump’s inauguration last month. Pages detailing U.S. climate finance spending have also since been removed from the State Department website.
These are concerning developments. The United States is a significant contributor of climate finance and has traditionally been one of the more transparent donor countries in reporting where funding has gone and what it has achieved. This detailed reporting illustrates the ways climate finance is a great deal for America and the world in terms of development, economic and security benefits.
The United States spent $2.6 billion in 2015 to support developing countries in mitigating and adapting to climate change, representing just 0.07 percent of the federal budget. While most of this funding is delivered bilaterally, $422 million – 16 percent – went to multilateral funds like the Global Environment Facility (GEF), the Climate Investment Funds (CIFs) and the Green Climate Fund (GCF).
U.S. Climate Finance Promotes Development
Besides assisting countries in reducing greenhouse gas emissions—which helps protect the United States and the world from the dangers of climate change—climate funding is delivering vital development gains in some of the poorest and most vulnerable countries. For example:
- The GCF’s 35 projects approved so far are expected to increase the resilience of 103 million people to extreme weather such as droughts, flooding and hurricanes. The United States has so far delivered a third of the $3 billion it pledged to the fund in 2014.
- Funding from the CIFs supports the construction of more than 17 gigawatts (GW) of clean energy capacity, more than the entire generating capacity of Colombia. Projects to improve energy access are expected to benefit 37 million people, more than the population of Canada.
- GEF projects approved in 2015 will protect 70 million hectares (173 million acres) of land and marine areas, promoting both conservation and development on an area larger than France.
U.S. Climate Finance Is Good for Business
The government also assesses ways in which climate funding benefits U.S. businesses, jobs and exports. For example:
- According to Treasury Department analysis, GEF projects have contracted U.S. companies from 23 states and Washington, D.C.
- The GCF is directly supporting projects implemented by U.S. corporations. One example is Acumen Fund Inc., a New York-based impact investor financed by the GCF to create a private equity fund for small- and medium-enterprises bringing off-grid solar power to 15 million people in Kenya and Rwanda.
- Out of the top 30 markets for U.S. renewable energy exports, more than half are eligible to receive funding from the GCF.
U.S. Climate Finance Reduces Threats to National Security
Based on the Pentagon’s assessment that climate change is a “threat multiplier,” experts at the State Department and Treasury have emphasized how climate funding helps shore up unstable areas of the world which, if left unaddressed, might present national security threats. For example:
- The GCF is financing projects that promote clean power, economic development and resilience in countries of key strategic interest for the United States, including Egypt, Jordan, Mali, Nigeria, Pakistan and Tunisia.
- The United States supports the Central America and Caribbean Catastrophe Risk Insurance Program, which provides rapid-payout insurance when natural disasters hit. This has boosted the resilience of countries in Central America and the Caribbean, addressing one of the root causes of increased migration from the region to the United States.
In his Senate confirmation hearing last month, Secretary of State Rex Tillerson said when asked about climate finance “In consultation with the president, my expectation is that we are going to look at these things from the bottom up in terms of funds we’ve committed toward this effort.”
As the above data—primarily from the U.S. government’s own experts—show, the benefits of climate funding outweigh its relatively modest cost. It represents a great deal, not only for the poorest and most vulnerable communities around the world, but also for American exports, workers and national security.
If you’re interested in finding out more about U.S. climate funding, archived copies of webpages from the Obama administration are still available, including:
- An overview of U.S. climate finance;
- A report detailing U.S. climate funding between 2010 and 2015;
- Developed countries’ joint statement on tracking progress towards the $100 billion climate finance goal; and
- Details of the U.S. commitment, made in December 2015, to double adaptation finance by 2020.