Monday, June 25, 2012

Greening 3Ps


Public Private Partnerships
Whereas adaptation is defined by the Intergovernmental Panel on Climate Change as “adjustment in natural or human systems in response to actual or expected climatic stimuli or their effects, which moderates harm or exploits beneficial opportunities,” mitigation is “an intervention to reduce the causes of changes in climate, such as through reducing emissions of greenhouse gases to the atmosphere.”[1]
Most global reports highlight the role for cities as the center for green, but they are also important location leverage private investments for public infrastructure where much of this work takes place (i.e. transport, waste management, power, and so on).

Financing is fundamental for future progress, yet city halls might not have the direct authority to manage all projects, therefore PPP’s become ever more important.  For example, many green PPPs are public enterprises (i.e. highways, roads, electric companies, waste water treatment plants and other water management facilities, etc.) which are paid for by user fees.  Typically, these public entities are not included into a municipal budget and are often outside the City Hall’s direct control.
What City Hall does have control over:
Public information campaigns (e.g. solid waste separation and bike sharing programs)
Smart land-based instruments can simultaneously increase both urban revenues and urban density
The use of development charges to discourage sprawling development
Insuring  municipal debt is paid for and not defaulted (in order to not derail national macro-economic stability)
Setting the tax rate and bases for their property taxes, which is an important for regional economic development.
While municipalities are crucial for the appropriate execution of these greening programmes, they must rely on outside partners for implementation.  Important players include:
National Development banks (within developing countries)
International Financial Institutions like the World Bank
Land based fees (i.e. development charges and impact fees), are often passed on to the consumer after the purchase of a new home.
Municipal bonds in fact provide the securitized of risk for many public loans (which is ultimately pushed down to –and paid for--by the tax payers).
Carbon Financing  such as the Clean Development Mechanism (CDM) and Joint Implementation (JI), as well as other carbon market instruments, such carbon offsets on the voluntary carbon market.
Explain Cities and Carbon Market Finance and use an example from this report. [2]
Yet, only 1% of CDM projects have been used to fund urban sustainability.
Outline some of the models from the report such as Bogota’s BRT or the Christchurch City Landfill Gas Utilization Project
The C40 can work together to establish more of these models
Municipal loans (at least in the US) have low default rates and therefore are a good investment overall.  In the US private entities re-shape into public ones in order to get tax credits (industrial bonds). Perhaps this could use to develop future financial mechanism in developing countries.




[1] Global Climate Change Impacts in the United States, Thomas R. Karl, Jerry M. Melillo, and Thomas c. Peterson, (eds.). Cambridge University Press, 2009.

[2] Clapp C., A. Leseur, O. Sartor, G. Briner, J. Corfee-Morlot (2010), “Cities and Carbon Market Finance: Taking Stock of Cities‟ Experience with Clean Development Mechanism (CDM) and Joint Implementation (JI)”, OECD Environmental Working Paper No. 29, OECD Publishing, © OECD.

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