The Adaptation Fund, established under the Kyoto Protocol of the United Nations Framework Convention on Climate Change (UNFCCC), has now been approving funding for adaptation projects for more than two years. Given its particular institutional status and specific focus on concrete adaptation, it is particularly relevant to study the initial experiences of it for any future upscaling of international adaptation finance, despite the fact that its own resources are getting scarce. Alternative rationales for allocating funds, based on equity and efficiency concerns at both international and subnational levels, are here tested against the criteria and priorities of the Fund and decisions made on project approval. It is concluded that equity concerns appear to be the primary motivation and that allocation is de facto made between states rather than by considering inequity between subnational communities. However, the currency of vulnerability for determining equitable outcomes in allocation decisions has not been formalized, despite its central importance to the Fund. Instead, uniform national caps have been introduced. Such an equality approach can be considered inequitable. Finally, it is noted that although the Adaptation Fund Board has continuously developed its proposal review practices and adopted a learning-by-doing approach, it should provide both a further specification of the evaluation criteria and a compilation of best practices from approved proposals, and moreover enhance the transparency of the review process, all of which would clarify its core priorities for current and future project proponents. Policy relevance Adaptation to climate change is a complex phenomenon. Given the uncertainty of climate impacts, the magnitude of expected adaptation needs globally, the limited knowledge regarding what constitutes effective adaptation, and scarce public resources, it is of vital importance that the policy and scientific communities learn how it can best be supported. The Adaptation Fund is an innovative funding mechanism in several respects, yet it is still unclear what the underlying rationale is that informs the allocation of its scarce resources. This article aims to interpret whether equity or efficiency concerns influence allocation and make some concrete recommendations as to its future form, thereby contributing to the state of knowledge regarding the Fund's role.
Persson, A; Remling, E
Equity and efficiency in adaptation finance: initial experiences of the Adaptation Fund
Climate Policy