The Effectiveness of Climate Finance: a Review of the Clean Technology Fund

The analytical report presents a study on the effectiveness of international climate funds using a common analytical framework.The Clean Technology Fund is the largest multilateral mitigation fund, with a capitalisation of US$5.2 billion in grants and concessional loans. Its objective has been to harness the private sector in pursuit of “transformational change” in developing countries towards low carbon development strategies. Its focus is on financing the deployment of low carbon technologies at scale. The experience of the Clean Technology Fund (CTF) offers important insights into what it takes to use diverse financial instruments at scale to support developing countries to respond to climate change. In addition to seeking to foster innovative approaches to delivering finance at the minimum level of concessionality possible, the CTF has made investments that seek to reduce the costs of promising new technologies such as concentrating solar thermal power. Its experience reinforces the importance of grounding programs in country context with due attention to issues of institutional capacity and preparedness.