CALL FOR IDEAS

At the start of each annual cycle, the Lab holds an open call for ideas for financial instruments that can unlock investment to tackle some of the most difficult climate and sustainable development challenges. The deadline to submit an idea for the Lab’s 2020 cycle is December 20th, 2019 at 17:00 PST. We will host a webinar in Portuguese on November 26th and another one in English on December 3rd to cover the 2020 cycle. The selected ideas will be announced in February 2020.

WHAT IS THE LAB LOOKING FOR?

The Lab is seeking ideas for financial instruments that can unlock investment for climate mitigation and adaptation projects in developing countries. For the 2020 cycle, the Lab has a special call for ideas that target sustainable energy access, sustainable cities, sustainable agriculture, and nature-based solutions, and that target the geographies of India, Brazil, and Southern Africa. We also welcome ideas that target other sectors and developing countries. 

Climate Adaptation and Mitigation

The Lab seeks the most transformative ideas – both mitigation and adaptation – in developing and emerging economies, including those that do not fit in the priority sectors included here. 

Sustainable Energy Access

Sustainable Development Goal 7 aims to ensure affordable, reliable and modern energy for all by 2030. However, more than 1.2 billion people currently live without access to reliable electricity.

Significant investment is needed in order to close the gap, and achieve universal energy access by 2030, though CPI research has found that there are relatively few blended finance initiatives that focus on distributed and off-grid electricity generation. There is a key need to identify, develop, and scale financial solutions that enable private sector capital to flow into energy access investments, including solutions for distributed generation, off-grid, and “last-mile” grid connection, thereby creating a viable market for generating and delivering energy to the developing world.

With additional support from The Rockefeller Foundation, the Lab is seeking proposals for innovative financial instruments to address market barriers and support the scale-up of sustainable energy access for both residential and business application.

These sustainable finance vehicles will offer returns for investors, while reducing emissions, supporting improved livelihoods and access to education and opportunities, and reducing negative health impacts associated with carbon-intensive forms of energy production.

Nature-Based Solutions

Nature-based Solutions are actions to protect, sustainably manage, and restore natural or modified ecosystems, in order to reduce emissions, enhance resilience, and offer human development and biodiversity benefits  

Despite their importance, the conservation and restoration of natural ecosystems has been funded almost exclusively by limited public or philanthropic funding, though the introduction of innovative approaches which catalyze private sector investment will be crucial in achieving multiple Sustainable Development Goals and creating a viable market for nature-based solutions.

The Lab is seeking proposals for innovative financing solutions that seek to unlock private investment in projects that conserve and restore biodiversity and ecosystems in developing countries around the world.

Relevant solutions could include (but not be limited to) financial instruments that focus on scaling up the preservation and restoration of forests as well as conservation and restoration of marine ecosystems and wetlands; prevention of desertification, other ecosystem services, or building climate resilient infrastructure.  

Sustainable Cities

Cities are critical players on climate change. More than half of the global population lives in cities, which consume over two-thirds of the world’s energy and account for more than 70 percent of global carbon emissions. And with 90 percent of the world’s urban areas situated on coastlines, cities are at high risk from climate change impacts such as sea level rise and extreme weather events.

For this reason, cities are on the front lines of climate action, making bold commitments around climate-resilient, low-carbon development pathways. To mobilize the finance needed to bring these commitments to fruition, policy makers, the business community, philanthropic actors, and all classes of investors must work together to pilot, implement, and scale up sustainable investment models.

With the support of Bloomberg Philanthropies and other funders, the Lab is seeking proposals for innovative financial instruments to address market barriers and support the deployment of climate solutions in cities in developing countries, including in energy efficiency, clean energy, low-carbon transport, and other sectors. Proposals may be completely new – i.e., ideas never before implemented – or may seek to adapt or replicate a previously piloted instrument in new developing country city contexts. The Lab will work closely with The Global Covenant of Mayors for Climate & Energy, an international alliance of nearly 10,000 cities and local governments, throughout the Lab process.

Sustainable Agriculture

With support from the International Fund for Agricultural Development, the Lab is seeking proposals for innovative and transformative financial instruments to mobilize investment to overcome existing barriers to climate resilient, low emission agriculture, with a regional emphasis on sub-Saharan Africa.

Countries in sub-Saharan Africa remain among the most vulnerable in the world to the impacts of climate change, which are already a major cause of out-migration and poverty. Here, climate impacts on agriculture, which employs 60% of the workforce, will increase vulnerability and further threaten rural poverty, which is particularly acute among women and young people.

Key barriers to rural transformation and improved resilience in the region include a lack of land tenure, basic infrastructure, technology and knowledge, as well as insufficient access to well-organized markets and financial services, including credit and insurance.

Overcoming these barriers requires the development of new business models and approaches that are (1) attractive to the financial sector and (2) supportive of a paradigm shift toward low-emission, climate-resilient agriculture in a way that transforms the livelihoods of women and young people, and increases food security and nutrition.

WHO IS INVOLVED?

The Lab is composed of over 60 expert institutions in government, development finance, philanthropy, and the private sector. The full list of Lab Members can be found here. The funders for the Lab’s 2019 cycle are included below. Climate Policy Initiative serves as the Lab Secretariat.

 

            

             

HOW ARE IDEAS SELECTED?

Successful ideas are selected by Lab Members and other experts based on the following criteria.

Actionable

Identifies (1) the type of entity(ies) that could implement it, (2) the pathway towards implementation, including the timeframe, activities, and key milestones, and (3) possible challenges to implementation and related management strategies.

Innovative

Demonstrates the ability to address, directly or indirectly, barriers to private climate finance that (1) have not yet been addressed or (2) that will be addressed more effectively compared to other instruments in the market.

Catalytic

Demonstrates potential to (1) mobilize private climate capital within a sizeable market, (2) be scaled up or replicated in other contexts and, (3) achieve socioeconomic, development, and environmental impacts.

Financially Sustainable

Identifies (1) a strategy to phase out public financial support, thereby achieving market viability and (2) possible challenges to achieving its intended objectives and related management strategies.

WHY SUBMIT AN IDEA? 

Selected ideas will receive guidance and support from high-level leaders from both the public and private sectors, who contribute expertise, political capital, and financial capital to the instruments. See the full list of Lab Members here.

Selected ideas will also benefit from robust analysis, stress-testing, and development by Climate Policy Initiative’s team of experts.

thousand

value of analytical and communications support received by selected Lab ideas

billion

mobilized by Lab instruments endorsed in previous cycles

million

invested by Lab Membership of over 60 expert institutions

WHAT HAPPENS IF YOUR IDEA IS SELECTED?

If your idea is selected by Lab Members, you will work with a team of analysts, key stakeholders, and experts to:

✓  Develop or refine the mechanics of your idea

✓  Survey comparable instruments, ensuring the final instrument is innovative and impactful

✓  Develop robust financial modeling

✓  Assess and document potential social and environmental impacts

 Map risks and risk mitigation strategies

✓  Develop a detailed implementation plan

✓  Produce promotional content

✓  Present your idea to donors and investors

✓  Potentially receive endorsement from the Lab

HOW HAVE PREVIOUS LAB INSTRUMENTS PROGRESSED?

Below are a few examples of Lab instruments that were launched and endorsed in previous Lab cycles, and their latest impact and progress. To learn more about all previous Lab instruments, visit Ideas.

Climate Investor One

Climate Investor One, a financing facility for early-stage development for renewable energy projects in developing countries, has reached final close at $850 mn, and is already invested in several projects, including a 116MW rooftop solar project and a 42MW run-of-river hydro project.

Learn more

Energy Savings Insurance

Energy Savings Insurance provides an insurance product for projected energy savings for efficiency projects undertaken by small and medium enterprises. Energy Savings Insurance now has projects in seven Latin American countries that will target thousands of businesses.

Learn more

Climate Resilience and Adaptation Finance and Technology Transfer Facility (CRAFT)

CRAFT is the first commercial investment vehicle to focus on technologies and solutions for climate adaptation. CRAFT has secured $45 mn of approved investment commitments towards a $75 mn first close.

Learn more

Submit your idea for an innovative sustainable investment vehicle by December 20th, 2019 17:00 PST. Register for the Call for Ideas webinars on December 3rd or November 26th (in Portuguese) to learn more about the Lab process and selection criteria. For any questions, you can get in touch at lab@cpiclimatefinance.org