Carbon finance can be a useful source of additional funding to launch new projects or to sustain the activities and outcomes of existing ones. Funders are also encouraged to investigate additional innovative financing mechanisms, in order to mobilise the cash flows needed for climate change mitigation and adaptation, and to address other environmental challenges. However, enhanced vigilance is needed with regard to the integrity of these markets and their role in achieving carbon neutrality, as well as their adherence to the avoid-reduce-compensate hierarchy.
It is in this context, with its opportunities and threats, that the FFEM is today publishing the Note on “FFEM principles for supporting project initiators using “carbon finance”. The Note is intended for project initiators wishing to leverage carbon finance, regardless of the sector in which they operate (energy transition, forestry, agriculture and land use, mangroves, etc.). The aim is to set out the requirements for securing funding from the FFEM.