New York, New York- From November 5-7, the Global Environmental Facility (GEF) meets at the World Bank to set its investment strategy for the coming years. A new report offers recommendations for how GEF can deliver better progress to address transportation, the fastest growing source of energy related climate change pollution. GEF is a small but vital source of funding for low-carbon pilot projects and capacity building in the transport sector for dozens of countries. GEF has invested more than $3.6 billion since its inception toward mitigating climate change, but only about 10% of this has gone to sustainable transport. The GEF has progressively increased its allocation toward its transport portfolio – investment has grown from around 3% of total climate change investment to roughly 20% in GEF-5.  However, utilization is still low, demonstrating the need for improvement.

Rapid economic growth and urbanization in developing nations spurs global demand for transport, a critical component of all economies. Transport accounts for nearly a quarter of global energy use and total transport energy use and carbon emissions are projected to grow 80 percent from 2002 levels by 2030. GEF can play a key role financing transformational initiatives that support improved mobility and access while curbing emissions.  

The current GEF-5 Strategy named sustainable transport as a key objective under the Climate Change Mitigation Focal Area. While the proposed GEF-6 Strategy highlights sustainable transport as a critical component in several programs, it is no longer a key objective. The Partnership on Sustainable Low Carbon Transport (SLoCaT), representing over 80 organizations, recently raised concern in a letter to the GEF Secretariat that this reorganization might result in a diluted focus on sustainable, low-carbon transport interventions, where GEF’s support is needed most.

A report released today by the Institute of Transportation and Development Policy, Maximizing the Effectiveness of the Global Environmental Facility (GEF) Sustainable Transport Portfolio, examines selected GEF projects and offers recommendations for more effective GEF action in the transport sector. The paper addresses the proposed restructuring of GEF-6 and its implications for future transport funding. The full report is available for download on www.itdp.org.

The Report discusses how the Rio + 20 commitment by eight Multilateral Development Banks (MDBs) of $175 billion for more sustainable transport over the next decade makes GEF investments in this area more important because GEF funding often creates the foundations for larger projects that can be funded by more mainstream development mechanisms. The GEF’s transport portfolio has leveraged more money per dollar invested than any other within the climate change focal area. For every dollar invested, 12 dollars were leveraged.

The biggest impediments to successful GEF transportation project implementation are unclear or unrealistic project designs and difficulty in adjusting project design to a dynamic political environment following project approval. While not all projects successfully achieve all predetermined targets, even unsuccessful GEF pilot projects are valuable exercises that can help guide future interventions.

The Report’s Key Recommendations include:

• Transport should remain a key objective, or sub-objective, within the GEF Climate Change Mitigation strategy, with a dedicated funding allocation. Another option could be to introduce a transport-specific sub-focal area under the urban systems program.
• A larger portion of transportation grants should be allocated toward barrier removal and other activities.  Many case studies show that many activities classified as “other” – outreach, awareness raising, capacity building, and training – are where GEF grants often have significant added value.
• The GEF should further streamline the project approval process by standardizing ex- post GHG impact calculation through the use of standard tools such as the TEEMP model.

• GEF should focus its resources on not-yet-mainstream and breakthrough interventions by staying one generation ahead of current trends. In the transport sector, this means advanced travel demand and traffic management, such as congestion pricing, BRT network management, and transit-oriented development and urban design.