Global Innovation Lab for Climate Finance(the Lab) Call for Ideas 2024

The Global Innovation Lab for Climate Finance(the Lab) is a network of over 70 expert institutions and investors from government, the private sector, philanthropy, and development finance, which identifies, develops, and launches innovative finance instruments that can drive billions to climate action and sustainable development.In nine years, the Lab has helped launch 68 solutions, collectively mobilizing over US$ 3.5 billion in sustainable investment.

Each year, the Lab holds an open call for ideas for financial instruments that can unlock investment to tackle some of the most difficult climate and sustainable development challenges. Throughout an annual cycle, selected ideas receive guidance and support from high-level leaders from the public and private sectors, who contribute expertise, political capital, and financial capital to the instruments. Selected ideas also benefit from robust analysis, stress-testing, and development by Climate Policy Initiative’s team of experts.

About

Global Innovation Lab for Climate Finance is looking for innovative finance solutions that can unlock investment to tackle some of the most difficult climate and sustainable development challenges and investment opportunities for a net zero economy. Proposed sustainable finance vehicles should offer returns for private investors, create jobs and other local economic benefits, sustain biodiversity, improve climate resilience and/or decrease emissions.

Eligibility Requirements

In 2024, the Global Innovation Lab for Climate Finance will develop a record ten climate finance ideas from five regional programs and four thematic streams.

Brazil: The Lab seeks transformative investment solutions that can drive funds for Brazil’s national climate priorities. The U.K. Department for Energy Security & Net Zero funds the Lab’s Brazil program.
India: With support from Bloomberg Philanthropies, the Lab is seeking innovative solutions to finance India’s green growth, providing concrete solutions to the unique financing challenges to investment in green sectors in India.
East and Southern Africa: The Lab’s East and Southern Africa program seeks innovative finance instruments to address the unique challenges of the Southern Africa Development Community (SADC) and East African Community (EAC) regions. These regions are among the most vulnerable to climate change due to their exposure to climate change stresses and low adaptive capacity.
Latin America and the Caribbean: The Global Innovation Lab for Climate Finance is introducing a new regional program targeting LAC countries in 2024. The Lab will select two ideas, one each for adaptation and mitigation to climate change. Successful ideas will provide solutions to challenging investment barriers to climate projects in emerging economies in the region. These investment barriers are:
- Mismatch between the type and scale of available and required financing options.
- Lack of awareness and capacity to leverage climate finance among local financial institutions.
- Conservative and risk-averse investment strategy among local stakeholders.
- Mitigation-focused ideas should accelerate the transition to a net zero economy in LAC by reducing greenhouse gas emissions and mobilizing private capital. Submissions should identify how the proposed financing approach would achieve significant emission reductions, contribute to the long-term goal of a net zero economy, and be financially sustainable and scalable.
- Adaptation-focused ideas should aim to channel investment into building climate resilience and responding to growing climate risk, including at a systemic level, in LAC. Submissions should identify how the proposed financing approach would address specific physical climate risks and overcome barriers to mobilizing finance for climate adaptation, particularly in smaller markets. Ideas should also demonstrate the potential to avoid maladaptation,
The Philippines: With funding from Global Affairs Canada through the United Nations Development Programme, Global Innovation Lab for Climate Finance seeks one solution that mobilizes private climate finance investment in the Philippines with the potential to scale across the Asia-Pacific region. The successful idea will focus on blended finance and financial innovation in NBS, though the Lab will still accept non-NBS solutions for consideration in our other thematic streams. The minimum threshold to qualify for the Phillipines stream is to have the Phillipines as one of the primary target markets.
Agriculture and Food Systems: With support from the U.K. Foreign, Commonwealth, and Development Office, CLIC has partnered with the Lab to develop an innovative solution to accelerate and scale up climate and nature finance for agriculture and food systems. The selected solution will demonstrate how to bridge demand and supply, making it easier for businesses and organizations in the sector to access the financing they need.
Climate Adaptation: With the support of the U.S. Department of State, the Lab is seeking proposals for innovative financial instruments and solutions that channel investment into building climate resilience and responding to growing climate risk, including at a systemic level. There is a critical need to develop and scale a broad array of financial solutions – including debt and equity facilities, results-based instruments, project finance, and insurance mechanisms – that enable capital to flow to adaptation.
- Submissions should focus on climate-stressed regions in developing countries and identify how the proposed financing approach would address specific physical climate risks and overcome barriers to mobilizing finance for climate adaptation. Submissions should also include a plan to phase down public financial support while offering attractive risk-adjusted returns to investors to scale private investment. Lastly, ideas should demonstrate the potential to avoid maladaptation, support improved livelihoods, and strengthen the broader financial ecosystem in the implementation countries.
Open Idea/Climate Mitigation: Global Innovation Lab for Climate Finance is looking for one outstanding concept for a financial instrument that targets investment opportunities in decarbonization that does not fit into the set sectoral and regional streams.While the Lab will consider mitigation-relevant ideas from any region or sector, they are interested in scalable renewable energy solutions (especially energy access), low-carbon transit, buildings, industrial sectors, and/or the just energy transition, and the phase-out of coal and fossil fuels.
- Submissions should explain clearly why the target sector and geography identified are key for climate finance mobilization and how they would benefit from the Lab’s support.
High Integrity Forests: High Integrity Forests (HIFs) are forests that have maintained their ecological integrity due to a lower degree of modification or degradation from human activity. They provide various underappreciated social, environmental, and economic benefits. These benefits include carbon sequestration and storage, moderation of extreme weather events, preserving water tables, improving biodiversity outcomes, and the climate resilience of surrounding areas. With support from the U.K. Department for Energy Security & Net Zero, the Lab seeks innovative finance solutions focused on mobilizing private capital for the protection and sustainable management of high-integrity forests across emerging economies, based on the Forest Landscape Integrity Index.
- Successful ideas will demonstrate actionable strategies to overcome investment barriers and facilitate private capital mobilization for HIFs through blended finance mechanisms and other de-risking approaches such as insurance. Moreover, successful ideas will deploy robust monitoring and measurement components. Models may include a carbon component. However, any revenue generated from the sale of carbon must be a secondary revenue source rather than primarily dependent on it as a primary source. Eligible ideas could include

Benefits

Selected ideas receive guidance from high-level leaders from the public and private sectors, who contribute expertise, political support, and financial capital.
Selected ideas also benefit from robust analysis, stress-testing, and development by Climate Policy Initiative’s team of experts.
If your idea is selected by Lab Members, you will work with a team of analysts, key stakeholders, and experts to:
- Develop or refine the mechanics of your idea.
- Survey the market landscape of comparable solutions and assess the idea’s viability and impact potential.
- Develop robust financial modeling
- Assess and document potential social and environmental impacts
- Map risks and risk mitigation strategies.
- Develop a detailed implementation plan.
- Create promotional content and pitch your ideas to donors and investors.
- Potentially receive endorsement from the Lab.
- Get implementation support to execute go to market strategy.