The Green Finance Institute (GFI) was set up in 2019 off the back of a Green Finance Taskforce policy recommendation made to the government. Funded by both government and philanthropic capital, the GFI sits between the public and private sectors to work on market-based solutions that enable private capital to flow toward climate projects.
The GFI takes a sectorial approach, with programs on the built environment, road transportation, nature-based solutions, sustainable aviation fuels, municipalities, and emerging markets. The GFI works with key stakeholders, including central government, local government, financial institutions, industry, and academia to ensure that solutions are designed to be impactful, scalable, and adopted by the market.
To date, the GFI has successfully delivered on several thought leadership pieces including a piece with Oxford University, advised the UK government on its Green Finance strategy, and designed various financial mechanisms/structures to enable the mobilization of climate finance, including the £500m London Green Finance Fund and £6.3m raised in Local Climate Bonds (LCBs).
Since 2020, the GFI has advised the Greater London Authority (GLA) on the establishment of a Green Finance Facility. In June 2023, the GLA announced the London Green Finance Fund, which will initially provide up to £500m of concessional financing to London boroughs and anchor institutions for their climate projects. The structure of the fund was designed by GFI, considering learnings from international case studies and key stakeholder engagements. Initially, the fund is managed internally and capitalized using GLA’s own balance sheet and public capital from the PWLB, where balance sheet funding is used to provide a discounted rate compared to PWLB. Over time, the structure will evolve to an arm’s length entity which will be managed externally to crowd in private capital.
The GFI is also designing a programme to provide support to municipalities in South Africa with their climate projects. The programme will aim to work in tandem with other organisations, such as GIZ, Power Africa and FCDO to provide capacity support to municipalities, particularly on their ability to source and develop projects from a financial lens. In addition, the GFI plans to work with financial institutions in South Africa to introduce municipal climate projects as a new asset class and work on solutions that would enable them to invest at scale. The GFI anticipates that this programme will begin in Q4 2023.
CCFLA members can learn about GFI’s work by looking on the company’s website here and reading the various reports that we have published since our inception. Additionally, members are encouraged to reach out to Jeremy Gorelick and Elhan Cara to arrange a call if they would like to discuss anything regarding the GFI and its work.
The GFI stays informed about city-level climate finance and related topics by communicating regularly with its extensive network of key stakeholders, including local governments themselves. In addition, the GFI has been a member of the CCFLA since 2020, which has further help the organization to stay updated on city-level climate finance developments.
The GFI has contributed to CFFLA by regularly participating in conversations around city-level climate finance, offering its expertise and experience in this space to help lead the conversation towards credible financial solutions that cities around the world can adopt.