Opinion of the European Economic and Social Committee on ‘Facilitating access to climate finance 
for non-s tate actors’
(own-initiativ e opinion)
(2019/C 110/03)
Rappo rteur: Cillian LOHAN (IE-III)
Lega l basis Rule 29(2) of the Rules of Procedure
Own-initiative opinion
Plenar y Assembly decision 15.2.2018
Section responsible Agriculture, Rural Development and the Envi ronment
Adopted in section 27.11.2018
Adopted at plenar y 12.12.2018
Plenar y session No 539
Outcome of vote
(for/ag ainst/abstent ions)114/6/7
1.Conclusions and recommendations
1.1 Although large funds have been pledged in Climate Finance pacts, the EESC wants to highlight a problem with small 
scale non-stat e climate actors accessing financ ing to ensure potent ially transf ormative initiatives are suppor ted and can 
happen.
1.2 The flows of climate finance in the European Union need to be urgently monitor ed and mapped. This will facilitat e 
measur ing the impact for non-stat e climate actor s, and ensure the progress on a wider transf ormation of the economy to a 
low carbon model can be assessed.
1.3 The sources of finance are disparate , as are the botto m-up initiatives that require access. Mechanisms to address this 
disconnect are not in place. This should be addressed by establishing an inclusive Climate Finance Forum at the EU level.
1.4 The EESC is proposing a Climate Finance Forum to address the key issues, bringing together key stak eholders to 
identify barriers, design solutions, and identify most effici ent mec hanisms for improved distr ibution of finance, including a 
type of matc h making service that link s projects and appropr iate climat e financ e sources to each other .
1.5 A mechanis m for reaching initiatives that require smaller sums needs to be create d (then effectively communicated) 
that includes:
—simplified application process
—simplified repor ting requirements
—matc h funding
—suppor ts for projects at design stage, pre-application for funding
—suppor ts for capacity building, networking, exchang e and platf orm development at local, regional, national and 
European level.C 110/14 EN Official Jour nal of the European Union 22.3.2019
1.6 A focus on climate finance should not be to the exclusion of responsible financ ing in other areas. All financing 
should be climat e proof ed to ensure that any funding and financ ing outside of specif ied climate financ e is not work ing 
agains t the climate commitments and targets. This needs to be adhered to in the cont ext of the Paris Agreement 
Article 2.1c, for existing financ e flows to be consist ent with a pathwa y towards low greenhouse gas emissions and climate- 
resilient development.
1.7 A toolkit needs to be developed, with a clear communication strate gy, that empo wers non-state actor s at all levels to 
understand and be able to access climate financ e. The toolkit should facilitate project developers to design projects that will 
contr ibut e to a low carbon and climat e-resilient economy .
2.Introduction
2.1 This opinion builds on the previous EESC opinions on the ‘Coalition to deliver commitments of the Paris 
Agreement’ (1) and on ‘Boosting climate actions by non-state actors’ (2) as well as on the recent EESC study (3) which 
highlighte d barriers hamper ing stronger involvement of non-state actors in climate action.
2.2 In 2018, the EESC called for a ‘European Dialogue on Non-State Climate Action’ (ED-NSCA) to strengthen and 
increase the scope and scale of European-based non-state climate action. It stated that the purpose of the dialogue should be 
not only to highlight and show case actions, but also to respond to the needs of non-stat e actor s by inspir ing new 
partnerships among state and non-state actor s; facilitating peer learning, training and advice shar ing among non-state 
actor s; increasing financ e available and facilitat ing access to it.
2.2.1 The term ‘non-state actor s’ refers to actor s that are not Party to the Unit ed Nations Framework Conve ntion on 
Climate Change (UNFCCC). This broad understanding includes various types of business, including small, medium-sized 
and micro-enterp rises; investors; cooperatives; cities and regions; trade unions; communities and citizen groups; faith-based 
organisations; youth groups; and other non-go vernmental organisations.
2.2.2 The proposed European Dialogue on the Non-State Climate Action process should suppor t access to financ e for 
non-stat e actions. This should involve:
—the mapping of funding oppor tunities;
—advice on fundable plans;
—looking at how the existing financ ial value chain (both public and private) is providing funding for climate invest ments 
that non-stat e actor s aim to do;
—analysing the possibilities for effective funding/financing distr ibution to smaller scale projects that have the potent ial to 
be transf ormative;
—analysing current dialogue and consultation procedures with non-stat e actors, with a view to establishing new 
techniques and best practices to enhance the use of existing European and inter national funds;
—advo cating for the upcoming Multiannual Financial Framework of the EU to serve the higher climate ambitions of, and 
incentivise actions by, non-stat e actor s;
—the exploration of innovative funding (peer -to-peer , crow d, micro, green bonds, etc.).22.3.2019 EN Official Jour nal of the European Union C 110/15
(1) EESC opinion on the Coalition to deliver commitments of the Paris Agreement (OJ C 389, 21.10.2016, p. 20).
(2) EESC opinion on Boosting climate actions by non-state actors (OJ C 227, 28.6.2018, p. 35).
(3) EESC study on a Toolbo x for multi-stakeho lder climate partnerships — A policy framew ork to stimulate bottom -up climate actions.
2.3 Climate Finance can be interpreted in many ways but the United Nations Framewo rk Conve ntion on Climate Change 
(UNFCCC) standing committee on finance defines it as ‘finance that aims at reducing emissions, and enhancing sink s of 
greenhouse gases and aims at reducing vulnerability of, and maintaining and increasing the resilience of, human and 
ecological syste ms to nega tive climat e chang e imp acts ’.
2.4 This opinion looks at Climate Finance in relation to EU Member States and the non-par ties to the UNFCCC within 
those countr ies, allowing CSOs, municipalities and local gover nment access to the financial instr uments required to assist in 
the design and implementation of projects, initiatives and activities that contr ibut e to reducing emissions, and climate 
proofin g communities.
2.5 It is impor tant to view this opinion in the cont ext of Climate Justice (4) as a means of ensur ing that the costs of 
climate action are not dispropor tionally placed on the poorest and most vulnerable in society .
2.6 Financing the first steps in a transition to a low carbon economy and for both adap tation and mitigation is critical to 
ensure a just transition, and to accelerat e actions at ground level.
2.7 For micro projects and small projects the amounts from EUR 2 000 to EUR 250 000 can be difficult to access. 
Effic ient mechanisms are required to ensure that smaller scale community-led actions are not excluded from the 
transf ormative pote ntial of climate financ ing.
2.8 The EU has over the last decade successfully developed a rang e of financ ing mechanisms tailored to such needs — 
the EIDHR Democracy and Human Rights programme, GCCA (Global Climate Chang e Alliance), NGO Co-funding and 
Decentralised cooperation financial instr uments — which could inspire the development of appropr iate climate chang e 
instr uments.
3.Identif ied Problems
Context
3.1 The EESC is firmly committed to the Unit ed Nations 2030 Agenda for Sustainable Development and the Paris 
Agreement. However , our current traject ory will at best only limit the increase in temperature to 3 oC or more, which is 
well beyond what is stipulated in the Paris Agreement. The shift towards sustainability will require major efforts and 
significant investment. Total annual averag e energy-relat ed mitigation investment for the period 2015 to 2050 in pathwa ys 
limiting warming to 1,5 oC is estimated to be around USD 900 billion according to the IPCC special repor t on the impacts 
of global warming of 1,5 oC above pre-industr ial levels.
3.2 Although the investment required to tackle climat e change is large it is not as large as the investment required to 
rescue a collapsing financ ial sector in recent years. On that occasion invest ments of EUR 2,5 trillion were mobilised. The 
potent ial collapse of the ecosystems that sustain us should warrant at the very least an equal response.
3.3 Too often the climate finance discussion concentrat es on creating new explicit funding lines while the Paris 
Agreement calls for all finance flows to be consiste nt with a pathwa y towards low greenhouse gas emissions and climate 
resilient development.
3.4 The Mar rakech Partnership and the Global Climate Action Agenda are oppor tunities for the enga gement of non- 
state actor s in the formal UNFCCC process. Cap turing actions within the EU, and financ ing actions in order to maximise 
their pote ntial imp acts is not a focus when designing financing packag es.
3.5 While there has been progress on the issue of financing the fight against global warming and its effects, it has not 
been enough. The latest Intergo vernmental Panel on Climate Chang e repor t (5) clearly states that we are in a critical period, 
with radical actions required in the next decade to limit impacts to manageable levels. Political priority must be given to 
sustainable financ e and a sustainable economy , in particular through clear , stable and incentive-based legislation.C 110/16 EN Official Jour nal of the European Union 22.3.2019
(4) EESC opinion on Climate Justice (OJ C 81, 2.3.2018, p. 22).
(5) IPCC special repor t on the impacts of global warming of 1,5 oC above pre-industr ial levels (Oct ober 2018).
3.6 It is not suffi cient to allocate a set percentage of a budget to climate finance if another part of the budget is spent on 
climate damaging activities. The whole of any spending needs to be considered in term s of its climate impact. An 
Intern ational Monetar y Fund working paper estimates the total of global direct and indirect subsidies for fossil fuels at an 
annual figure of USD 5,3 trillion, equating to more than USD 15 billion per day. Even with the envisag ed Green Climate 
Fund amounting to USD 100 billion per year , the negative impact of these subsidies is not offset.
3.7 The energy transition will not be successfully implemented in time and in line with the European commitments 
under the Paris Agreement, if the issue of energy poverty is politically neglected. A fair distr ibution of both financial and 
social costs and benefi ts associate d with Europe's sustainable energy transition among all levels of govern ment and marke t 
actor s, including citizens, is needed. The scientific study of Heat Roadmap Europe (6) shows that Europe is able to reduce its 
GHG emissions by 86 % in 2050 compared to 1990 with existing technologies in an affordable and cost-eff ective manner .
3.8 Research for this opinion highlighted the lack of information on mapping flows of dedicated climat e finance within 
Member States. It is difficult to assess if funds are being brok en into smaller accessible pots of money or what the 
transf ormative effect of the funding is. This lack of monitoring and repor ting increases the ambiguity around the perceived 
problem, and hinders the development of the most effective solutions.
Access for business and SMEs
3.9 Access to funding remains a chief challenge for all types of non-state actor s, including the varied challeng es faced by 
SMEs and larger businesses. This challeng e does not only entail the availability of more and additional funding, but also the 
clarity of existing funding mechanisms .
3.10 Moreover , there is also difficulty in defining what constitutes a ‘green investment ’. Investors are primar ily 
concer ned with risk and retur n, and it is difficult for them to assess the pote ntial impact on the climate of a proposed 
project, and to measure its chances of success. Private lenders will be reluctant to financ e a project without clear 
understanding of invest ment risks as well as risk mitiga tion mechanisms — in other words without guarantees.
Access for local and regional gover nments
3.11 For subnational gove rnments, factor s limiting their access to financ e include: low credit ratings; limited capacity to 
mobilise private finance due to insuff icient size of the low-carbon infrastr ucture investment market and unattractive risk- 
retur n prof iles; and sovereign limits set by national gover nments on how much or if a sub-national gove rnment can borrow 
from the private secto r.
Access for community initiativ es
3.12 There are currently many thousands of grassroots initiatives on climate change and sustainability in Europe. These 
initiatives have a significant contr ibution to make to EU climate, energy and sustainability goals but they are mostly reliant 
on volunt eers and a major barrier to their development and upscaling is the lack of funding and professional suppor t. 
Often, very modest resources are required, without which initiatives struggle to progress and launc h projects. The 
transf ormative pote ntial of these initiatives is not being harnessed.
3.13 In many cases, local grassroots initiatives find it difficult to access conventional sources of funding. Often, the 
minimum amount of funding required to apply for is too high, and well beyond the needs or managem ent capacity of 
small-scale local initiatives. Co-fi nancing requirements create additional barriers.
3.14 Matchi ng funding requirements, excessive paper work and comp licated processes are part of the problems 
identifie d by smaller groups in accessing financ e. Though these types of projects/initiatives are individually small their 
cumulative effect can be large. There are also many additional local knoc k-on benef its and advantages when small 
community-based programmes are suppor ted with adequate financing.22.3.2019 EN Official Jour nal of the European Union C 110/17
(6) Hor izon 2020 research and inno vation programme under grant agreement No 695989 — Heat Roadmap Europe.
3.15 Most, if not all funding is project oriented and does not address the need for resources to suppor t processes at 
diffe rent levels, from community organising and capacity building at local level, to networking, exchang e and platf orm 
development at regional, national and European level. Funding suppor t in this area could greatly help to accelerate the level 
of citizen and community enga gement on climate action and also help to ensure there is suffi cient organisation and 
collaboration to suppor t scale up and contr ibute to policy development.
Access for Inno vation Funding
3.16 Early-stage entrepreneurs also face several challenges in access to finance, lack of knowledg e and exper ience, access 
to markets and scaling beyond the start-up phase. Financing inno vation is a critical part of the solution to the climate crisis, 
but equally being inno vative in the financ ing mechanis ms and their deliver y is required. Initiatives such as EIT Climate -KIC 
aim to address these challeng es by mainstreaming climate in financ ial markets, democratising climate risk information and 
suppor ting invest ments in inno vative start-ups.
4.Proposed solutions
4.1 The EESC proposes a type of Climate Finance Forum be established at the EU level with a decentralised netwo rk. This 
would bring together all relevant parties and facilitate a coordinat ed response to the problems identified here. It would be a 
conduit for developing the mechanisms required, as identified in this opinion.
4.2 A function of the Climat e Finance Forum needs to be a dialogue platf orm to help connect particularly promising and 
effective non-stat e solutions to private and institutional investors. In addition, a strong focus on scale-up and replication 
potent ial is needed across EU Member States and elsewhere, to maximise imp act. The EESC, with its network of organised 
civil society groups throughout Europe, is in a strong position to be part of a Climate Finance Forum, as a voice that can 
represent the grassroots issues with accessing finance.
4.3 Effective communication will be an essential part of any successful strate gy to address the problems in climate 
financ e. Communication needs to travel in all directions, clearly identifying the audience and communicating in effective, 
precise and appropr iate language the oppor tunities and accessibility of financ e options.
4.4 The European Commission and other EU institutions need to develop guidance documents for non-stat e actor s to 
make use of existing funding mechanisms . There is a need for a syste m that would identify , analyse, synthesise and 
disseminate information on the variety of funding sources available for climat e action by non-stat e actors. This can build on 
the work being done by the European Committe e of the Regions, which is identifying steps to developing a toolkit 
compri sing easily understood information for local and regional author ities on funding and financing available for climate 
action.
4.5 A monitoring mechanism is required to create clear mapping on climate financ e flows, helping to identify the blocks 
and focussing on the practical solutions to remove those blocks. This is an urgent first step. A mapping process would also 
be a critical step in understanding the barriers to access for small scale non-stat e actor s. Mapping the financing will also 
help to identify the gaps in captu ring positive climate actions that should be part of the Global Climate Action Agenda 
process.
4.6 The EESC calls for the EU to be a leader in provid ing a model on how to capt ure non-stat e actors' contr ibution to 
achi eving climat e goals. European non-stat e climate actor s — especially smaller ones — expect help from European 
institutions to mobilise dedicat ed climate funds, and to gain better access to funding through simpler procedures and 
repor ting. This would facilitate captur ing many actions that go unrecognised in the fight against climate chang e. For 
exam ple, projects below a certain financial threshold such as EUR 50 000 could have a simplified one-pag e application, and 
one-page repor ting form.C 110/18 EN Official Jour nal of the European Union 22.3.2019
4.7 There is a need for additional funding in the form of small scale grants, with simplified application and repor ting 
procedures, specif ically targe ting local grassroots action on climate chang e and sustainability , and without prohibitive co- 
financ ing rates. Mec hanisms that allow projects to cluste r together could be designed to imp rove the impact of the 
financ ing, and to facilitate access. These tools need to be urgently developed.
4.8 A suppor t mechanism that allows projects to avail of exper tise in the pre-application for finance stage , so that 
projects are designed effectively and pitched appropr iately , should be developed.
4.9 An overall reflection on innovative financing mecha nisms needs to be developed at the EU level. Non-state actor s 
should be involved in this discussion from the outset to ensure simplicity and clarity of allocation criteria.
4.10 In general, a closer cooperation between established climat e and sustainability funds and financial programmes and 
non-stat e actor s netwo rks should be established. This is a question of kno wledge shar ing, communication and dialogue. A 
Climate Finance Forum can facilitat e this.
4.11 Financial measures could also incentivise non-stat e action, or climat e-friendly behavi our by non-stat e actor s. For 
instance, tax deductions at the national level could help low-carbon production and stimulate participation by non-state 
actor s in climat e action.
4.12 In formulating the new EU Multiannual Financial Framework there may be oppor tunities to enable botto m-up non- 
state climate action to effici ently deliver on EU climate commitments under the Paris Agreement. In this regard, the EESC 
asks for an increase of at least 40 % in EU expenditure contr ibuting to climate objectives (7). Secondly , the EESC calls for a 
swif t phase-out of fossil fuel subsidies and no direct or indirect (co-)fi nancing of any fossil based energy through European 
funds.
4.13 A climate proofi ng tool must be developed in order to ensure any public spending is not working to suppor t 
activities that exacerbate the climat e crisis. This should also apply to private financ ing programmes. Allocating specif ic 
funds for climat e financ e should not mean that the other parts of a budget or of financ ing is allocated to activities that are 
working in opposition of the climate objectives. The objective set in Article 2.1c of the Paris Agreement has to be met.
4.14 The EU's main financial instr ument to suppor t botto m-up local development is the Community-led Local 
Development (CLLD) approac h. It is ideally placed to suppor t these botto m-up initiatives, offering the pote ntial to provide 
grants and suppor ts that are tailored to local circumstances. In December 2017, the EESC adopt ed an opinion on 
‘Advantages of the CLLD approach for integrated local and rural development ’ (8) which urged the European Commission to 
explore and analyse in depth oppor tunities to create a reser ve fund for CLLD at EU level. Irrespective of this, it 
recommended the European Commission to ensure that all Member States have a national CLLD fund with contr ibutions 
from all four ESI funds (EAFRD, ERDF , ESF and EMFF). This CLLD structure could be one of the conduits used to suppor t 
micro and small projects refer red to in 2.7.
4.15 To mak e the financ ial value chai n more sustainable as a whole, the EESC suppor ts the Commission's road map on 
financ ing sustainable growth (9) adop ted in Marc h 2018. The EESC has made concrete recommendations to this Action Plan 
in its respective opinions (10).
Brussels, 12 December 2018.
The President  
of the European Economic and Social Committee
Luca JAHIER 22.3.2019 EN Official Jour nal of the European Union C 110/19
(7) EESC opinion on the European Finance-Climate Pact (OJ C 62, 15.2.2019, p. 8).
(8) EESC opinion on the Advantage s of the Community-led Local Development approach (OJ C 129, 11.4.2018, p. 36).
(9) Communication from the Commission to the European Parliament, the European Council, the Council, the European Central Bank , 
the European Economic and Social Committee and the Committee of the Regions — Action Plan: Financing Sustainable Growth.
(10) EESC opinions on Acti on Plan on Sustainable Finance (OJ C 62, 15.2.2019, p. 73), Sustainable finance: taxonomy and benchmarks 
(OJ C 62, 15.2.2019, p. 103) and Institutional investors’ and asset manag ers’ duties regarding sustainability (OJ C 62, 15.2.2019, p. 97).