Gold Standard unveils financing framework at World Urban Forum

At the World Urban Forum in Medellin, Colombia, The Gold Standard Foundation today released the first-ever financing framework designed to inject the billions of dollars needed to scale-up clean technology and pro-poor development in cities around the globe.

“This framework greatly broadens the potential sources of financing for these critical urban initiatives because the mandatory verification of results by an independent third party, such as The Gold Standard, provides the credibility and assurance that funding agencies need,” said Abhishek Bansal, The Gold Standard’s Cities Programme Manager.

Climate finance has largely failed to reach cities and efforts to reduce greenhouse gas (GHG) emissions that have taken place rarely focus on improving the lives of the people living in those communities, for example, by providing access to basic services like electricity and clean water. These shortfalls have been attributed to a lack of rigorous auditing frameworks and the absence of viable large-scale, long-term financing structures. According to the World Bank, only 4 percent of the largest 500 cities in the developing world are credit worthy in international markets, making it almost impossible to secure the finance needed for transformational change.

The new Gold Standard Sustainable Cities framework goes beyond strictly GHG driven interventions, allowing funding agencies and developers to include activities with significant social benefits independent of their associated GHG emission reductions. For example, providing access to clean water can result in GHG emission reductions and deliver a critical health service to a local community.

In addition to traditional carbon finance, project developers can now pursue a mix of other alternatives like grants, green bonds, and preferential loans from local and multilateral agencies in addition to other results-based financing schemes, both public and private.

The study that established these innovative new financing frameworks focussed on poor and middle-income urban communities in Delhi, India. The Gold Standard Sustainable Cities Programme will subsequently implement a pilot programme in Delhi and in other suitable locations around the world.