Green finance in green building needs under the Paris Agreement

Abstract

Green building (GB) is a key mitigation and adaptation measure in the Nationally Determined Contributions (NDCs) of Parties to the Paris Agreement. This paper explores the potential of green finance (GF) to support country efforts to shift from conventional construction to GB and to promote green renovations in existing buildings (GREB) within the context of the 2015 Paris Climate Agreement. Through a meta-synthesis of new or updated country NDCs, we provide, first, a comprehensive qualitative overview of country perspectives on GF-in-GB needs. Second, we examine the role of domestic finance, international financial support, and fiscal policy reforms toward GB and GREB implementation. Finally, the role of financing actors in promoting GF-in-GB-and-GREB is discussed. The analysis of new or updated NDCs revealed that only 20 of the 42 countries reviewed provide clear cost estimates for proposed climate-related buildings and construction activities. Developed countries account for more than 80% of total cost estimates. The majority of developing country adaptation and mitigation efforts are contingent on international climate (green) finance. While certain domestic finance sources are mentioned, the majority of countries emphasize the need for (international or national) fiscal policy reforms to help finance climate action. The findings of the study could serve as a useful reference to Parties when developing future NDCs.