By Alexandra Batchelor, Shira Miller, Stuart Iler, Amber Houghstow, and Alex Clark.
This is the Executive Summary of the final report from a Philanthropy Advisory Fellowship project to develop a strategy to effectively address climate change. The full report (redacted for client confidentiality) is available here. This research was conducted on behalf of PAF client Ray and Tye Noorda Foundation.
Climate change is linked to multiple facets of modern economies and global institutional structures. Choices between mitigation of greenhouse gas emissions and climate adaptation reflect the joint challenge of averting severe climate change and preparing for its effects. The first section of the report examines potential interventions subject to a set of criteria, including potential impact, data quality and tractability. The most effective interventions are highlighted. The second section draws on the material of the preceding section to provide more detailed recommendations on specific interventions and organizations.
Section I - Background and Context
Direct emissions reductions are broken down into energy, land use and transport.
Energy: The greatest opportunities for additional impact are local, through community, policy and advocacy work, rather than direct implementation of specific technologies. Promising strategies include the development and demonstration of innovative ownership and financing mechanisms, and building of connections between local and state government, non-profit groups and grassroots advocacy to curtail the lifespan of existing fossil fuel infrastructure and deter further investment.
Land use: The primary challenge is economic. While afforestation has significant carbon mitigation potential, underdeveloped carbon markets limit its cost-effectiveness, due to the opportunity cost of forestry over other, more lucrative uses. Soil carbon capture technology has potential, but remains some distance from commercialization. Funding is best directed towards alleviating financial barriers, and supporting carbon pricing mechanisms that reduce opportunity costs to landowners.
Transport: Low-carbon transport still requires technological advances, but relies most heavily on infrastructure and planning. The magnitude of investment in the sector is such that philanthropy is unlikely to have significant impact. Behavioral change programs for individual users present the most cost-effective direct interventions. The most effective policy interventions are those with multiplicative impact, shifting investment away from fossil fuel infrastructure, towards sustainable mobility systems.
Adaptation needs are difficult to assess, and subject to ongoing change based on actual and predicted climate impacts. Additional research is needed to understand available options and quantify direct and indirect benefits. Funding for coordination, development of best practices and education on adaptation may be particularly valuable at the subnational level.
Research and development (R&D) activity is considered in three forms: mitigation, adaptation, geoengineering, and policymaking. Programs include basic scientific research and the development of the results into technologies, business models and policies. Innovation-focused grants may have the most impact in areas where the Ray and Tye Noorda Foundation has sufficient leverage, such as funding early-stage clean-energy startups that align with its social and environmental goals.
Advocacy, litigation and governance are linked together to understand the elements and tactics that support effective advocacy campaigns. Particular attention is paid to the partisan divide in the U.S., litigation, governance gaps in subnational climate policy, and effective targets by industry, scope, and location. Accounting for the inevitable uncertainties and risks, advocacy work appears highly cost-effective when carried out optimally. Effective advocacy campaigns exhibit common characteristics and sequences of action. The most successful campaigns overall typically involve multiple organizations leveraging their respective expertise as needed. The clearest example of an effective target is fossil-fuelled energy infrastructure, not least because the acute or chronic damage it can cause locally is a powerful leverage point for change.
Coordination and capacity building at the subnational and non-state levels are increasingly important components of global efforts to reduce greenhouse gas emissions. Over the years, coordinated pressure and commitment from non-state actors has become an integral part of the international negotiation process. While there is significant activity in this arena, there is a demonstrated need for umbrella organizations capable of boosting capacity, and improving the effectiveness, of subnational networks and actors. Areas currently lacking support include state legislatures, rural communities, and small municipal jurisdictions. Any strategy to address these gaps must also look for opportunities for cross-cutting regional cooperation across sectors and jurisdictions.
Climate finance may involve direct provision of financing; deployment of financial instruments; and stimulating financial flows. There are three ways of doing this: diverting public-private funds into mitigation/adaptation investment; aggregating philanthropic funds to facilitate larger projects than would otherwise be possible; and addressing investment gaps that capital markets cannot fill. All climate finance is not created equal—directly funding mitigation efforts may in general be far less catalytic (therefore less effective in the long term) than investing in the reduction of market barriers or mobilizing other private or public funding sources. Program-related investments (PRIs) are one such instrument, offering concessional terms and/or below-market returns to achieve specific program objectives. PRIs are designed to be reinvested over time to achieve multiplicative impact, and can, if done effectively, spur additional investment from private capital. Regulatory barriers aside, while mission investments can be risky, they are key to bridging existing financing gaps for key technologies, and mitigation or adaptation programs.
Section II - Recommendations
Three recommendations for promising interventions are put forward:
Working with local partners to advocate against coal power in China, India and Southeast Asia. Several organizations are working together in the region to advocate for environmental protections with climate co-benefits. Notable among these is 350.org East Asia and its partner organizations, many of which work at the local level to build and train grassroots networks to pressure local and national governments to curtail existing and planned coal power. Similarly effective organizations are Green Camel Bell (China), Piglas Pilipinas (Philippines) and Change (Vietnam). Large nonprofits like 350.org receive the most attention, leaving other effective but smaller groups underfunded. 350 works to alleviate this problem by extending financial support to smaller partner organizations. We recommend working closely with 350.org’s partners or others similarly effective in the region.
Growing capacity and coordination at state and local levels in the U.S. This strategy, besides addressing a clear gap in subnational climate governance, can reap multiple benefits by directly reducing emissions, while also boosting the confidence, political will, technical capacity and ambition of national governments, having a potentially catalytic effect. Promising areas of focus include supporting umbrella or “backbone” organizations; bridging partisan divisions; supporting legal challenges; and working with funders’ networks.
Contributing to one or more climate philanthropy bodies that strategically target climate finance interventions. The most effective financing strategies address financing gaps or barriers with a view to facilitating market-driven long-term climate financing, rather than tackling emissions reductions directly or funding advocacy programs that rely on grants and donors in perpetuity. Deployment of innovative financial instruments that close financing gaps for risky projects, and funnel private investments into clean infrastructure, can drive further investment.
The full report is available here.