Two to tango: How governments can unlock private investment for national climate goals

Even the most ambitious national climate plans aimed at cutting emissions to meet the 1.5C global warming goal in the Paris Agreement often lack a vital ingredient for success: private investment. With governments facing fiscal and political pressures, attracting private capital will be crucial for accelerating climate action in the coming years. Yet many Nationally Determined Contributions (NDCs) still do not have the sector-specific plans, economic incentives, policy certainty, infrastructure investment and ongoing dialogue needed to break silos between the public and private sectors and bring more businesses on board. “If you just have the high-level (NDC) target from the government in a vacuum, it’s not going to spur much business action,” said Greg Briner, senior manager for policy at the We Mean Business Coalition, which works with companies pushing for stronger climate action. “But that target combined with … more specific policies and measures that get put in place as a result of that target-implementing process, or as a result of the NDCs, is where the magic starts happening,” he explained. NDCs: late and inadequate NDCs are voluntary climate action plans created by countries under the Paris Agreement. They include commitments such as expanding renewable energy, reducing fossil fuels, halting deforestation and other measures to cut greenhouse gas emissions and limit global warming. First submitted in 2015 for the Paris Agreement, NDCs should be updated with more ambitious targets every five years, although some governments have not stuck to this timetable. Last year, most countries missed an initial February deadline to finalise the latest round of plans, known as “NDCs 3.0” – and at least 50 countries, mainly developing nations, have still not done so. Paris Agreement committee snubbed over missing NDC climate plans Although these national plans have helped drive emissions reductions in some sectors – including falling deforestation rates and greater