Climate-Smart PPP Policies and Legislation

PPP policies and legislation can lay down the guiding principles to ensure that a climate change impact analysis is undertaken during project development and that the identified issues and opportunities are reflected in the project design and implementation. While requirements related to climate change risks are sometimes referred to in PPP policies, guidelines and legislation, they are more often included in broader climate change or infrastructure programs or plans as well as sectoral policies and legislation that need to be considered for the development of PPP infrastructure projects. Ideally, such requirements are harmonized with overall PPP policies and legislation to ensure that identified climate change issues are integrated consistently within PPP projects.

International

Draft UNECE/EBRD People-first PPP Model PPP law and commentary, UNECE and EBRD November 2019 - Model Law for PPP/Concessions and its ability to promote People First Public Private Partnerships in furtherance of the United Nations Sustainable Development Goals takes into account the challenges that have arisen when attracting private business to infrastructure in connection with the Sustainable Development Goals (SDGs), and in particular with the Guiding Principles on People-First Public Private Partnerships (the “People-First PPP Principles”). Principle No. 7 of the People First PPP Principles refers specifically to resilience and climate change.

Regional

European Union: The Directives below entered into force on April 18, 2016, and include many provisions related to sustainable development.

• Directive 2014/52/EU of 16 April 2014 on the assessment of the effects of certain public and private projects on the environment addresses climate change. The EIA process includes for example an assessment of the impact of projects on climate (for example greenhouse gas emissions) and their vulnerability to climate change.
• See also Directive 2014/24/EU on public procurement as well as Directive 2014/25/EU on procurement by entities operating in the water, energy, transport and postal services sectors : Both Directives follow the same approach: Contracts are awarded based on the economically most advantageous tender (price, cost, quality-price ratio) Contracting authority can assess costs using a life-cycle costing approach (Article 82 and Article 67 respectively). Life cycle costing may include the costs of emissions of GHG and of other pollutant emissions and other climate change mitigation costs (Article 68 and Article 83 respectively). Technical specifications may include environmental and climate performance levels (Article 42, Annex VII and Article 60, Annex VIII respectively).

National

Jamaica

• Improving Climate Resilience in Public Private Partnerships in Jamaica - Report examines Jamaica’s PPP policy framework, practices and projects as well as emerging practices at the intersection of PPPs and climate change to understand what could be done. Includes an Action Plan with short, medium- and long-term steps Jamaica could take to better include climate resiliency aims in their planning process. See also the companion toolkit with practical guidelines and solutions to identify, assess, and mitigate climate-related risks.

Philippines:

• Public-Private Partnership (PPP) Governing Board Resolution of December 2018 provides guidelines to ensure that identified safeguard concerns are considered during the feasibility stage and integrated into the project design. This includes safeguards related to climate change mitigation as well as resilience to climate change hazards.
• National Government Agency Public-Private Partnership Manual: The Environmental Impact Assessment (EIA) includes designing appropriate preventive, mitigating and enhancement measures, including disaster risk reduction (DRR) and climate change adaptation (CCA) measures that will address the consequences to protect the environment and the community’s welfare.

Further Reading and Resources: Climate-Smart PPP Policies and Legislation

Climate Toolkits - The Public Private Infrastructure Advisory Facility (PPIAF), The Global Infrastructure Facility (GIF), and International Finance Corporation Public-Private Partnership (IFC PPP) Transaction and Advisory Services have joined forces to build upon best practice on a topic at the cross-roads of climate change, infrastructure, and private sector participation. The toolkits provide a set of practical tools to integrate climate mitigation and adaptation into PPP advisory work and project structuring. Sector-specific toolkits are included. 

For general resources on climate-smart PPPs, please see Climate-Smart PPPs: Further Reading and Resources.

For climate-smart procurement policies and legislation see also Procuring Climate-Smart PPPs.

Emerging Trends in Mainstreaming Climate Resilience in Large Scale, Multi-sector Infrastructure PPPs PPIAF - Report summarizes review of 16 PPP policy frameworks globally with regard to climate change and shares recommendations on ways forward to incorporate climate risk and resilience better in PPP frameworks.

Nationally Determined Contributions (NDCs)

• The Paris Agreement requires all Parties to put forward their best efforts to achieve its ambitious goals through nationally determined contributions (NDCs) and to strengthen these efforts in the years ahead.
• UNFCC's NDC Registry records NDCs communicated by the Parties in accordance with Article 4, paragraph 12 of the Paris Agreement.
• The World Bank Group's NDC Platform provides a full picture of the detailed targets, implementation plans, and, where available, self-reported cost estimates from countries that have submitted NDCs.

Climate-Smart Policies, Legislation and Guidelines

In response to the challenges posed by climate change and to implement their obligations under the Paris Agreement many countries have adopted or are currently adjusting policies and legislation to reflect climate change mitigation and resilience objectives as well as NDC commitments.

Databases

• Climate Change Laws of the World Database - Grantham Research Institute on Climate Change and the Environment and Sabin Center for Climate Change Law
  • Covers national-level climate change legislation and policies in 177 countries. The online database covers climate and climate-related laws, regulations, policy statements, and other directives issued by national governments.
  • Features climate litigation database by Sabin Center/Arnold & Porter Kaye Scholer
    • US Climate Change Litigation,
    • Non-US Climate Change litigation,
• The Law and Climate Change Toolkit - The Law and Climate Change Toolkit is an online and open database developed through a partnership between the UN Climate Change secretariat, UN Environment Programme, and the Commonwealth Secretariat working in close collaboration with partner countries, international organizations and research institutions. The Toolkit is designed to provide a global resource to help countries put in place the legal frameworks necessary for effective domestic implementation of the Paris Agreement and their nationally determined contributions (NDCs). The key features of the Toolkit include functionalities to search existing climate change-related legislation and undertake an assessment of a selected country’s legislation to help users identify priority areas for climate law review and potential legislative or regulatory reform.
• IEA/IRENA Addressing Climate Change - Policy and Measures Databases: Searchable by multiple search criteria, including by region, country, policy type (e.g. regulatory instrument, voluntary approaches) and climate change policy targets.

Further Reading and Resources: Climate-Smart Policies, Legislation and Guidelines

For general resources on climate-smart PPPs, please see Climate-Smart PPPs: Further Reading and Resources.

• World Bank Reference Guide to Climate Change Framework Legislation, This Reference Guide to Climate Change Framework Legislation aims to help policy makers understand the benefits of legislating on climate change and establishes 12 key elements to assess framework laws.
• Legislating for a low carbon and climate resilient transition: learning from international experiences, Alina Averchenkova, Real Instituto Elcano January 2019 - The objective of this working paper is to inform policy experts, legislators and decision-makers on recent trends in climate change policy-making around the world and to draw lessons learnt from experiences with designing and implementing climate change legislation. The study in particular aims to contribute to the current debate in Spain on a draft climate change and energy transition law, as well as aid other countries currently working on climate legislation.
• Enabling Environment for Private Sector Adaptation, Vladimir Stenek, International Finance Corporation Jean-Christophe Amado, David Greenall, Deloitte IFC 2013 - Gives an overview of drivers at the country level that contribute to a business environment favorable to climate change adaptation and includes examples of national legal instruments relevant in this context.
• Commonwealth Climate and Law Initiative (CCLI) - The CCLI is examining the legal basis for directors and trustees to consider, manage, and report on climate change-related risk, and the circumstances in which they may be liable for failing to do so.
• The Checklist on Law and Disaster Risk Reduction, an annotated outline, IFRC and UNDP October 2015, provides a prioritized list of ten key questions that lawmakers, implementing officials, and those supporting them need to consider in order to ensure that their laws provide the best support for disaster risk reduction (DRR).The Checklist also aims to foster a more integrated approach to DRR by taking into account climate change and sustainable development considerations within the review of legislation. The checklist is complemented by The Handbook on Law and Disaster Risk Reduction which provides general guidance on key steps to consider when using the Checklist on Law and Disaster Risk Reduction.
• Effective Law and Regulation for Disaster Risk Reduction: A multi-country report, IFRC and UNDP, 2014 – The report assesses the legal frameworks for disaster risk reduction (DRR) in 31 countries. The purpose of this report is to support legislators, public administrators, and DRR and development practitioners and advocates to prepare and implement effective legal frameworks for disaster risk management (DRM) that are adapted to their own country's needs, drawing on examples and experiences from other countries. The document includes a specific chapter on DRR in climate change laws (chapter 18).

The majority of greenhouse gas (“GHG”) emissions today is associated with carbon-intense infrastructure construction and operation, particularly in the energy, public transport, water supply and sanitation sectors. At the same time, it is expected that economies will need to make significant investments over the next 10 - 15 years to build new or to rehabilitate ageing infrastructure to meet the increasing global demand, emerging economies and developing countries accounting for roughly two thirds of global infrastructure investment. Many risks associated with climate change will be felt hardest by lower income countries, as their ability to prevent and respond to the impacts of climate change is limited. Against this background there is an urgent need for the development and finance of climate-smart infrastructure solutions.

Private investment and expertise, including infrastructure finance through public-private partnership (PPP) models is essential for the delivery of climate-smart infrastructure. The application of PPP models presents both challenges and opportunities. Given the massive capital requirements and need for innovation (both in terms of technological solutions and funding structures), PPPs potentially provide a useful framework under which the public and private sectors can pool and coordinate their financial and technological resources more efficiently. At the same time, climate change creates novel forms of risk which are difficult to quantify and will present unique challenges to public and private sector parties seeking to negotiate an appropriate allocation of risk between themselves.

This section of the Public-Private Partnership Resource Center website provides links to policies, legislation, project documents and other resources that are relevant for developing, structuring and implementing climate-smart PPP projects: