Mobilizing Private Investment in Low-Carbon, Climate-Resilient Infrastructure
6 February 2012
OECD Headquarters, Paris
Summary Report (includes list of participants)
This expert meeting supports an OECD project that promotes good practice policies for encouraging private sector investment in low-carbon climate-resilient (LCCR) infrastructure. The project entails synthesis and analysis of policies and practices in OECD and non-OECD countries, with deeper insights drawn from case studies. One working paper will be produced, in a series of papers in this work area exploring good practice in policy design, implementation and government practices.
The meeting brought together outside experts to share experience and gather empirical evidence about financial and market barriers to LCCR infrastructure investment. It aimed to help project leaders access experience and on-the-ground knowledge about a variety of policies, instruments and practices designed to overcome LCCR investment barriers in different country contexts and selected sectors (in particular transportation). A case study of LCCR investment in Mexico was explored through the workshop, drawing upon expertise in transportation, public-private partnerships, infrastructure risk assessment, and climate change adaptation. It was designed as a small, informal and interactive expert discussion.
Partial grant funding for this event has been kindly provided by the government of the United Kingdom.
Welcoming remarks: Jan Corfee-Morlot and Chris Kennedy, OECD
Presentation: Towards an OECD Policy Framework for Green Investment. Jan Corfee-Morlot and Cristina Tebar-Less, OECD
Session I. Towards Low-Carbon Climate-Resilient Infrastructure
Presentation: Defining and financing LCCR infrastructure. Chris Kennedy, OECD
- What are the most useful components of the LCCR policy framework for infrastructure and how might it be improved as a tool for policymakers and other decision-makers?
- What are the particular financing and investment challenges for: i) infrastructure; ii) LCCR infrastructure development?
Session II. Infrastructure for Climate Change Adaptation
Presentations: Stephane Hallegatte, World Bank; Michael Mullan, OECD
- What policies and tools are governments and others developing for adapting infrastructure to climate change (including facilitating private sector engagement and investment)?
- What are the key financing gaps in adapting infrastructure? What role for private sector versus public sector finance and investment?
- What synergies and trade-offs if any in infrastructure sectors adaptation and mitigation simultaneously with other development goals?
Session III. Public-Private Partnerships for LCCR Infrastructure
Presentation: Joop Koppenjan, Erasmus University Rotterdam
- Are climate change considerations being incorporated into PPP settings (e.g., within national guidelines or into performance-based specifications in PPP agreements)?
- What types of PPPs work best for different sectors? Who should bear what type of risks, and at which stage of PPP projects?
- To what extent is there a policy learning process on PPPs amongst (developing) countries?
Session IV. Evaluating Investor Risk in Infrastructure Projects
Presentation: Mike Wilkins, Standard & Poor's Ratings Services
- What policies can be used to reduce investors’ risks, if subsidies are insufficient to provide adequate private sector returns at current levels of risk?
- What examples are there of countries reducing investors risks through government policy or by other means?
Session V. Applying the LCCR Framework to the Transportation Sector: Towards Good Practice
David Banister, Oxford University
Geraldine Ang, OECD
- What are the main challenges and market failures specific to LCCR transport infrastructure? How can these be best addressed through policy to catalyse private sector participation in transport LCCR infrastructure investment?
- What are the key assessment methods, risk-sharing mechanisms and financial instruments to improve projects risk-return value proposition and meet the private sector’s requirements?
- What are the priorities, opportunities and challenges in the transport sector to integrate adaptation to climate change?
- What is the price of carbon, or size of subsidy, or other form of public intervention required to transform investment towards LCCR transportation infrastructure?
- How successful has land value capture been in increasing revenues from transportation infrastructure investments?
Session VI. Mexico Case Study
Adriana Lobo and Salvador Herrera, CTS Mexico: Preliminary Outline of an LCCR Transportation Case Study for Mexico.
- How can we best highlight good practices for mobilising private investments in LCCR transportation infrastructure in the Mexico case study?
- What insights from today’s meeting might be explored further through the Mexico case study?
Closing remarks: Chris Kennedy, OECD
- What are the key lessons learned – notions of best practice – emerging from the meeting?
- What are the key remaining questions to address in attracting private investment in LCCR infrastructure?
For further information or queries, contact:
i) Chris Kennedy (christopher.kennedy[at]oecd.org ; +33 1 45 24 82 83 - project leader)
ii) Geraldine Ang (geraldine.ang[at]oecd.org ; +33 1 45 25 83 78 - meeting logistics)
Related documents (non-OECD):
How Europe's Initiative To Stimulate Infrastructure Project Bond Financing Could Affect Ratings (Standard & Poor's Global Credit Portal, May 2011)
Can Capital Markets Bridge The Climate Change Financing Gap? (Standard & Poor's Global Credit Portal, October 2010)
Investment and climate change
Workshop on Catalysing Investment in Low-Carbon and Climate-Resilient Growth, November 2011
Catalysing Private Climate Finance
Financing Climate Change Action
Financing Adaptation to Climate Change
Institutional investors and long-term investment