IDFC Green Finance Mapping 2022
Since 2011, the International Development Finance Club (IDFC) has conducted a periodic mapping of member institutions’ green finance contributions.
In 2021, IDFC members reported a record high of USD 224 billion in total green finance commitments, a 21% increase from 2020. Cumulatively, green finance commitments by IDFC members surpassed USD 1.2 trillion since the Paris Agreement was signed in 2015. This is the result of IDFC members’ unique ability to deliver green finance at scale. Mitigation finance reached the highest level to date (USD186.6 billion), increasing by 27% over 2020 and returning to a level not seen since 2017. Adaptation finance (USD 20.9 billion) decreased 24%, following a record high in 2020 (USD 27.5 billion). Overall, 13 institutions increased their green commitments in 2021, returning to, or even surpassing, pre-pandemic levels.
Key findings:
IDFC members reported total green finance commitments of USD 224 billion. This represents a 21% increase from 2020, evidence that green finance was channelled at scale in building back from the COVID-19 pandemic.
In 2021, green finance represented approximately 22% of total new commitments reported by IDFC members. Since 2015, green finance commitments have consistently represented more than one-fifth of total IDFC investments.
Climate finance – consisting of all activities related to the mitigation of greenhouse gas (GHG) emissions and adaptation to climate change – accounted for 95% of total green finance (or USD 212.7 billion), almost the exact same share as in 2020.
- Finance for green energy and the mitigation of GHGs was the largest category, representing 88% of climate finance.
Following record levels in 2020, adaptation finance declined 24%, primarily driven by 50% lower commitments for disaster risk reduction in 2021 compared to 2020 (excluding coastal protection). This is likely due in part to higher commitments in 2020 as an emergency response to the COVID-19 pandemic.
Finance to projects containing elements of both mitigation and adaptation increased 12% to USD 5.2, billion but remained approximately the same share of total climate finance as in 2020 (2%).
Finance for biodiversity projects reached USD 18.4 billion in 2021, 31% higher than in 2020. This includes, for example, finance for water supply, wastewater treatment, biodiversity conservation, and waste management, among others.
Additionally, IDFC members reported USD 3.5 billion of finance for other environmental objectives, which includes, inter alia, projects tackling pollution.
