Dublin will become the European base of a UN fund aimed at financing the transition to a low-carbon economy. The Financial Centres for Sustainability (FC4S) programme was founded by the United Nations Environment Programme, and encourages global financial centres to place sustainable and green finance at the heart of their operations.
The new European secretariat will be based in Dublin, with network members including London, Paris, Frankfurt, Milan, Luxembourg, Stockholm, Zurich and Casablanca. It was formally launched at the Climate Innovation Summit in Dublin Castle, which is part of Climate Week Ireland.
The European Commission says some €177bn will be needed between 2021 to 2030 to invest in clean energy and other mitigation measures, aimed at keeping average global temperature increases to well below 2C as agreed in the 2015 Paris Climate Accord. Scientists say ambition needs to be scaled-up to limit increases to no more than 1.5C, to prevent catastrophic warming.
The EU has pledged to help deliver the transition to a low-carbon and more resource efficient economy, including developing innovative ways of financing projects. The FC4S network is supported by an investment of €1.5m over three years from Europe’s EIT Climate-KIC agency.
Sustainable Nation CEO Stephen Nolan has been appointed as strategic adviser to the body. Ireland has a track record in this space, last month selling €3bn of green bonds, where demand hit more than €11bn, making it just one of four nations to provide an environmental finance product.
Communications, Climate Action and Environment Minister Richard Bruton said that in Ireland alone, some €50bn was needed over the next 20 years to retrofit housing stock. Government would only be able to fund around €5bn of this, so private sector financing would be required.
“There is an appetite for investment to transform the line of travel for our country,” he said. “I am delighted to welcome the launch of Dublin as the European node of FC4S. Global financial centres will have a key role to play in advancing the expansion of sustainable and green finance. They will be pivotal in driving the transformation of the financial sector so that capital allocation decisions, product development and services provision are truly aligned with the sustainable development and the green agenda.”
Climate-KIC CEO Kirsten Dunlop said new business models and ways of accounting, reporting and understanding social and environmental value would also be required to drive investment in low-carbon projects.