US Takes Global Green Climate Fund Pledges to US$12.8 billion

The US has pledged an extra US$3 billion to the global Green Climate Fund (GCF) as part of its second replenishment to fund projects in climate-vulnerable countries.

The US promise, announced at COP28, would take the world’s largest dedicated climate funding pool to a record US$12.8 billion if approved by the US Congress.

More than US$10 billion has been pledged so far in the current round of funding. The fund’s current portfolio consists of US$13.5 billion in GCF funding and co-financing of US$51 billion in 243 projects.

The fund’s Private Sector Facility (PSF) facilitates private sector investment through concessional instruments, including low-interest and long-tenor project loans, lines of credit to banks and other financial institutions, equity investments and risk mitigators, such as guarantees, first-loss protection, and grant-based capacity-building programmes.

While providing significant funding for needed projects, the fund has come under criticism in the past over its slow application and approvals process.

Established by the United Nations Framework Convention on Climate Change (UNFCCC), the Green Climate Fund (GCF) aims to support global climate action, by promoting a low-emission and climate-resilient transition in developing countries. It serves the Paris Agreement, supporting developing countries in reaching their nationally determined contributions.