Climate-Informed Decisions: The Capital Investment Plan as a Mechanism for Lowering Carbon Emissions
34 Pages Posted: 20 Apr 2016
Date Written: July 29, 2015
Global trajectories for reducing carbon emissions depend on the local adoption of alternatives to conventional energy sources, technologies, and urban development. Yet, decisions on which type of capital investments to make, made by local governments as part of the normal budget cycle, typically do not incorporate climate considerations. Furthermore, current academic and professional literature specific to climate change draws attention to decision-making tools that would require access to technical expertise, data, and financial support that may not be practical for cities in low- and middle-income countries. Arguably, the methodologies most able to effect this transformation will be those that are convenient and affordable to administer, and that offer straight-forward low carbon alternatives to traditional forms of infrastructure investment. Current methodologies for capital investment planning that do not take climate change into consideration can result in prioritization of investments that diverge from a low carbon path and a potential missed opportunity to reap financial benefits from efficiency gains. This paper concludes that relatively minor alterations to common procedures can reveal the trade-offs and local benefits of low carbon alternatives in the capital investment planning process. This paper was written as an input to the preparation of the Climate-Informed Capital Investment Planning Guidebook, a how-to guide for local government staff, which will be published in 2015.
Keywords: Economic Adjustment and Lending, Macro-Fiscal Policy, Intergovernmental Fiscal Relations and Local Finance Management, Climate Change and Environment, Public Finance Decentralization and Poverty Reduction, Municipal Financial Management, Regional Governance, Public & Municipal Finance, Science of Climate Change, Local Government, Urban Governance and Management, Municipal Management and Reform, Climate Change and Health, Social Accountability, Public Sector Economics
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