Subnational Government Climate Finance Hub

What's the issue?

Despite the key financial role that regions and cities play in the carbon-neutral transition and the global response to climate change due, in large part, to their jurisdiction over crucial adaptation and mitigation-relevant policy areas (land-use planning, waste management, transport) there is a lot that we do not know about their financial role.

How much are subnational governments spending and investing on climate change adaptation and mitigation?
How has their climate-related spending and investment evolved over time?
What public revenue streams are available to subnational governments to fund and finance their climate action? How can these sources be scaled-up?
Are the spending, investment, and revenue raising decisions of subnational governments aligned with their green objectives?

Given the urgency of the climate crisis, it is more important than ever to improve our understanding of the financial role of subnational governments in the transition, to track the progress regions and cities are making towards achieving the Paris Agreement commitments and other green objectives, and to identify areas where further action is needed to align their expenditure and investment with their climate goals and mobilise additional sources of finance.

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What's new?

>> "Embarking on subnational green budgeting" on CFE COGITO blog.

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What can the OECD and CFE offer?

The OECD supports evidence-based policymaking that will drive the carbon-neutral transition and promote sustainable, resilient, and inclusive regions and cities. We conduct policy analysis and share best practices in order to: i) craft actionable place-based policies; ii) improve coordination across levels of government; iii) amplify subnational governments’ significant, yet often overlooked, role in designing and implementing ambitious environmental and climate policies.

Based on the joint OECD and European Commission project Measuring and Enhancing Subnational Government Finance for Environment and Climate Action in OECD and EU Countries, the Subnational Government Climate Finance Hub encompasses three pillars of work:

Climate Expenditure Tracking

(Subnational Government Climate Finance Database & Methodology)

Climate Revenue Tracking

(Compendium of Financial Instruments that Support Subnational Government Climate Action)

Subnational Green Budgeting

(Guidelines, case studies, and self-assessment tool)

Introducing the Subnational Government Climate Finance Hub

Past Events
	2022 OECD Forum on Green Finance and Investment – “Making the most of subnational green budgeting to mobilise private climate finance”
	5-7 October 2022
	As part of the annual OECD Forum on Green Finance and Investment, this session tackled how subnational governments can make better use of their budgets to bridge climate funding and financing gaps. The session highlighted how to leverage public budgets to increase private climate finance, namely green bonds, green loans and other innovative instruments, and explored the challenges and opportunities that exist in scaling up these initiatives and disseminating best practices within the OECD and beyond. Speakers included: Gaël L’Aot, Inspector General of Services, Regional Government of Occitanie, France ; Enrique Rodriguez Varo, General Secretary of Budgets, Expenses, and European Financing, Autonomous Community of Andalusia, Spain ; Kit England, Green Economy Manager, Glasgow City Council, Scotland/United Kingdom ; Riikka Torppa, Deputy Head of Unit for Revenue Administration and Public Financial Management, DG Structural Reform Support (DG REFORM), European Commission ; and Laurent Gautier-Falret, Marketing Director, Local Public Sector and Associations, La Banque Postale, France. Access the Summary of the session. Please find more information about the Forum.

	Financing Climate Action in Regions and Cities: Launch & Conference
	22 June 2022
	Since 2020, the OECD and the European Commission (DG REGIO) have been engaged in a joint project to improve the understanding of the financial role of regions and cities in the carbon-neutral transition by enhancing the tracking, measurement, and mobilisation of subnational public climate finance. The Financing Climate Action in Regions and Cities conference, took place on 22 June 2022, presented the outputs of this project and the newly created Subnational Government Climate Finance Hub. Access the Agenda. Access the Summary of the Conference and the Presentation.


	OECD & CCFLA Joint COP26 Event: “Financing Climate Action in Regions and Cities”
	10 November 2021, 14:00-16:00 (CET)
	The OECD and The Cities Climate Finance Leadership Alliance (The Alliance) joined forces to facilitate an event that convened national and subnational policy-makers, climate and public finance experts, and private sector stakeholders from across the globe, and leveraged their combined expertise in subnational climate finance. Access the event recording here
	Expert Workshop on Tracking and Measuring Subnational Climate Finance (2021 OECD Forum on Green Finance and Investment)
	13 October 2021, 15:30-17:30 (CEST)
	This expert workshop is held as part of a joint project led by the OECD and the European Commission on Measuring and Enhancing Subnational Government Finance for Environment and Climate Action in OECD and EU Countries (see above). This virtual event gathered subnational government representatives, international partners and climate finance stakeholders engaged in tracking and measuring subnational climate finance worldwide. The event consisted of two sessions featuring keynote presentations from the OECD followed by roundtable discussions that discussed the preliminary findings of the project.
	Towards green budgeting in Brittany (Vers une budgétisation verte en Bretagne)
	24 March 2021
	As part of the two day event entitled "Towards green budgeting in Brittany (Vers une budgétisation verte en Bretagne)", co-organised by IHEST and the Region of Brittany, our team presented on the work of the Paris Collaborative on Green Budgeting and the current state-of-play of subnational green budgeting among OECD and EU countries. The presentation (De l’initiative Paris Collaborative on Green Budgeting à l’approche territoriale) highlighted existing subnational green budgeting initiatives, the challenges that exist in implementing green budgeting, and the benefits of green budgeting in helping subnational government align their fiscal strategies with their climate and environmental goals. Presentation by Isabelle Chatry

	2020 OECD Forum on Green Finance and Investment
	6-9 October 2020
	As part of the High-level Plenary on Accelerating Green Investment, our team organised and facilitated a session on the role of cities and regions in financing a green and sustainable post-COVID recovery. Bringing together elected officials and experts from development finance institutions and think-tanks, the session identified three key aspects that decision-makers should consider when designing recovery plans: Subnational governments need to be included in the design and implementation of the plans as they are at the forefront of tackling both climate change and the pandemic. Subnational governments requires enhanced technical and advisory assistance, in addition to financial resources, to effectively scale-up their green activities. Governments of all levels need to ensure that recovery plans fully address and integrate social issues to mitigate the potential impacts of the plans on vulnerable populations. Access the summary of the plenary discussion More information on the Forum

Key Resources
‌	2022 edition of the CFE Climate Brochure
	The climate transition represents a large part of the work programme of the OECD Center for Entrepreneurship, SMEs, Regions and Cities. The 2022 edition of CFE’s Climate Brochure outlines the wide ranges of projects that aim to support members with this challenge. Access the Brochure.

	The OECD/UCLG World Observatory on Subnational Government Finance and Investment (SNG-WOFI)
	2016-ongoing
	The World Observatory on Subnational Government Finance and Investment (SNG-WOFI) was launched in November 2017, as a joint endeavour of the Organisation for Economic Co-operation and Development (OECD) and United Cities and Local Government (UCLG). Access the Brochure. Access the Website.

	The Regional Recovery Platform
	Last updated May 2022
	The OECD Regional Recovery Platform contains internationally-comparable subnational data on the COVID-19 crisis and provides a compendium of policy solutions to support the recovery. The health, economic and social impacts of the crisis have been uneven across and within countries – and recovery from the crisis, so far, has also been uneven. Understanding the spatial dimension of the recovery and developing place-based policies is vital to support recovery in all regions.


‌	Financing Climate Objectives in Cities and Regions to Deliver Sustainable and Inclusive Growth
	September 2019
	This study is the first of its kind to explicitly develop a methodology for tracking and measuring climate and environment-related expenditure and investment in cities and regions across the OECD. The results revealed that regions and cities play an important role in financing climate action but more assistance from national governments is needed to mobilise additional public and private sources of funding. The study also highlighteda need for improved data collection and statistical systems to track the alignment of public financial flows with climate objectives, including at the subnational level, as called for in the Paris Agreement. Access the key findings. Access the full report.

Other Resources

Within the OECD, this work on subnational climate finance is aligned with broader national and international climate finance and climate policy initiatives, including the International Programme for Action on Climate Change (IPAC) and the Paris Collaborative on Green Budgeting. For more information on all of the OECD’s work on climate change, check out the OECD Climate Change Hub.

Questions? Contact

sngclimatefinancehub@oecd.org

Regional, rural and urban development

Subnational Government Climate Finance Hub