Marginal abatement cost curves, which suggest the cheapest approaches to reducing carbon emissions, are out of favor in international climate finance discussions because they are not good tools to use when thinking about systemic and urgent change. On the other hand, international financing studies based on adding up the investment requirements linked to an emissions path to 1.5 degrees of warming produce historically implausible numbers and endanger existing development finance. To close the gap, we need to push the cost curve down (through technology advance) and lower the price of finance (through scalable multilateral development bank support) while protecting development finance and focusing it on where it is most needed: the poorest countries suffering the most from climate change.
Official Development Assistance (ODA) isn’t what it used to be: each aid dollar is worth a lot less in terms of development outcomes. In large part that’s because the Development Assistance Committee (DAC), the donor club within the Organisation for Economic Co-operation and Development (OECD) that decides what counts as ODA, keeps changing the rules to include ever more spending that doesn’t deliver resources to recipient countries. It raises the question: does the DAC have a constructive role anymore?