Adaptation Finance Ecosystem in The Netherlands

11:15 Tuesday 28 May

OC023

Room S11

 

Bituen Hidalgo (Netherlands) 1

1 - Hidalgo Consultancy

Introduction

Over the past years, efforts have been made on establishing how to support climate change mitigation and adaptation using financial support from multilateral sources and grantors. This research aimed to explore the ways with which adaptation actions were realised and concretised in The Netherlands.

Objective

To give a more complete picture on the economics of adaptation finance, this paper will take a look at the adaptation finance ecosystem. As a test case for this kind of research approach, the situation in the Netherlands was studied. Netherlands is known to be active in climate action.

Methodology

This research is done using online, free and publicly available sources. Included in the data gathering are economic entities operating in the Netherlands or are projects or companies being funded from the Netherlands and investment funds owned by Dutch companies and/or operated by Dutch entities. The data were gathered in August 2017. Different financial and funding sources were included in the study. Adaptation actions, deals, and transactions considered in this research are closed or started or signed in 2016 and 2017.

Findings

The data sources yielded 27 transactions that qualify as adaptation actions, based on the definition used by IPCC. Researching on adaptation finance in the Netherlands required looking into various sources as there is no publicly available study on this. The intertwined nature of the adaptation finance ecosystem in the Netherlands, where financing involved projects with many parties, required the extension of the research to include non-finance corporations. A discovery in this research is the extent of data gathering efforts and capex and opex expenses done by corporations in order to adapt to climate change. The adaptation actions done by corporations are mainly to mitigate the adverse impact of climate change on revenue streams and operational risks.

Conclusions and Recommendations

To improve monitoring adaptation finance, the following are recommended: (a) Focus should be given to the adaptation finance ecosystem and not only on the financial institutions. (b) Adaptation finance policy makers should make data more available, easily accessible and cheaper. (c) To entice investors, the regulators and rating agencies should add a ‘climate action’ indicator in their reports, and (d) For Sustainability Reporting, the rating agencies can require information on how much the investments are in adaptation projects and whether these are in Annex I or Non-Annex I country.