Shifting the Trillions

The landmark Paris Agreement and the Agenda 2030 provide a new framework for global decarbonization and sustainable, climate-resilient development. Multilateral bodies like the G20 provide a natural focus point for governments of the leading industrial nations and emerging economies to take common action towards the achievement of these global goals. The mobilization of finance for sustainable investment, in particular the transition to a renewable energy system, is one of the most urgent but also promising tasks ahead.

This briefing paper outlines the potential of the G20 as a platform for action to shift international financial flows to low-carbon and climate-resilient development. It introduces the relevant long-term climate and Sustainable Development Goals, and outlines the current energy-, climate- and infrastructure-related work streams within the G20. It addresses the need to provide a reliable political framework for ambitious action and the important role of “long-term low greenhouse gas emission development strategies”. It then explores a broad range of issues related to the mobilization and characteristics of transition finance, such as disclosure of climate-related risks in the financial markets, stress testing and decarbonization strategies for businesses, the phase out of fossil fuels and policy instruments to correct the current market distortion and set energy prices right by pricing carbon dioxide emissions, and “Paris-compatible” investment criteria for public and private finance. Directed at decision makers and policy experts, it also highlights action items and options for intervention during the incoming German G20 presidency.

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