Much of the infrastructure built in the last century—which people need to thrive: energy, transportation, sanitation, hospitals, and schools—has been significantly carbon intensive.
And the world needs much more infrastructure in the coming
years as the population expands, urbanization increases, and the ambitions of
people to improve their livelihoods grow.
In the face of an intensifying climate crisis, unless we
quickly develop ways to deliver a new generation of infrastructure that is
sustainable, it will be impossible to meet our national and global
decarbonization goals in line with the Sustainable Development Goals and Paris
Agreement commitments.
Public budgets alone remain insufficient to close a
sustainable infrastructure investment gap estimated to be in excess of $3
trillion a year over the next 10 years, particularly in developing countries
where infrastructure deficits are particularly staggering.
And while investors see significant upside opportunity
presented by sustainable and low-carbon investments, the supply of bankable
infrastructure projects that are genuinely sustainable remains inadequate and
insufficient to achieve the scale necessary to truly the move the needle on
this issue.
FAST-Infra: —the ‘Finance to Accelerate the Sustainable
Transition-Infrastructure initiative
Recognizing the need to crowd-in more private investment
into sustainable infrastructure, the Global Infrastructure Facility (GIF) has
collaborated with the Climate Policy Initiative (CPI), HSBC, the International
Finance Corporation (IFC) and the Organisation for Economic Co-operation and
Development (OECD) on a joint venture called FAST-Infra—the ‘Finance to
Accelerate the Sustainable Transition-Infrastructure initiative.
Developed in early 2020 under the auspices of French
President Emmanuel Macron’s One Planet Lab, FAST-Infra is a public-private
initiative bringing more than 50 organizations together to push for collective
action to mobilize private finance and de-risk investments in sustainable
infrastructure in developing countries.
As part of this initiative, GIF co-chairs a working group
with Macquarie Green Investment Group on a key component of FAST-Infra—the
creation of a consistent, globally applicable labeling system for sustainable
infrastructure assets.
The Sustainable Infrastructure Label (SI Label) is meant to
add value across the infrastructure lifecycle—serving as a tool to inform
upstream project planning, prioritization, and design. It will also send clear market signals
further downstream post-construction to help investors align their decisions
with environmental, social, resiliency, and governance needs.
The label certification aims to increase financing potential
and motivate governments to design more projects with sustainability criteria
at their core—encouraging developers to maintain high environmental, social,
and resiliency standards at all stages of the infrastructure lifecycle.
“A key motivation behind the SI Label is not to reinvent the
wheel, but rather build on existing standards, frameworks, and taxonomies to
create a comprehensive framework and set of sustainability criteria that takes
into account best practices and evolves with changes in the market.”
While this might seem like a simple curation exercise, the
final product will be the first-of-its-kind framework that provides holistic,
actionable guidance at the asset level of key sustainable considerations for
infrastructure.
Next steps in the FAST-Infra journey
After many months of refinement and consultation among
FAST-Infra members, the SI Label has reached an exciting milestone—the creation
of the overall framework and underlying set of sustainability criteria that
will guide the SI Label process.
Each criterion is further described by reference to existing
standards and associated with a series of key performance indicators and
methodologies.
While getting to this point has been the product of
contributions from the FAST-Infra working group, we know that the more voices
we have, the more we can work together to solve sustainable infrastructure finance
challenges and make this initiative a success.
Therefore, we’ve opened the SI Label Framework and Criteria for public
consultation through August 31, 2021. The inputs from this consultation will
help us further refine the SI Label Framework and build momentum ahead of COP26
this November. In parallel, we have issued a call for Expressions of Interest
also through August 31, 2021, to provide support for the SI Label’s Secretariat
and Data Reporting Function—key components that will allow for the longevity of
this label for COP26 and beyond.
Creating a sustainable future cannot be done alone—it will
require the joint action of stakeholders across the public and private
sectors. Initiatives like FAST-Infra
demonstrate the power of partnerships and offer a viable pathway to close the
infrastructure investment gap and promote sustainable, inclusive growth.
We hope that you will be a part of this journey with us and offer your voice in enacting lasting change.
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