The World Bank’s Municipal Public-Private Framework Case Studies includes around 100 Project Summaries with examples of commercial value capture in various sectors and from countries around the world. Below is a list of projects and project summaries which repurposed or adapted/reused idle assets.  To find more see Municipal Public-Private Partnership Framework.

List of Projects

• Akaretler Row Houses, Istanbul, Turkey (56)
• Elbphilharmonie, Hamburg, Germany (58)
• Marine Sanctuary and Forest Preserve, Chumbe Island, Tanzania (60)
• Kruger National Park, South Africa (61)
• Jozini Tiger Lodge, Jozini Municipality of KwaZuluNatal, South Africa (62)
• Durban Point Waterfront Development Project, EThekwini, South Africa (71)
• Croydon Council Urban Regeneration Vehicle, London Borough of Croydon, United Kingdom (72)
• Redevelopment of Library and Fire Station, Washington, District of Colombia, United States (73)
• Fire Station Refurbishment, Chapel Hill, North Carolina, United States (74)
• Capitol Crossing, Washington, District of Colombia, United States (75)
• Mixed Use Development, Virginia Beach, Virginia, United States (78)
• Challenging Case: Slum Rehabilitation Scheme, Maharashtra, India (82)
• Challenging Case: Dege Eco Village, Dar es Salaam, Tanzania (83)
• The North Toronto Collegiate Institute (NTCI), Toronto, Canada (91)

The World Bank’s Municipal Public-Private Framework Case Studies includes around 100 Project Summaries with examples of commercial value capture in various sectors and from countries around the world. Below is a list of projects and project summaries which optimized use of asset and resource.  To find more see Municipal Public-Private Partnership Framework.

List of Projects

• Integral Treatment of Wastewater and Bio-Solids, Municipality of Saltillo, Mexico (25)
• Solid Waste Management, West Bank and Gaza (30)
• Next Generation Nationwide Broadband Network, Singapore (32)
• Free Public Wi-Fi and Interactive Kiosks Project, Kansas City, United States (33)
• Establishment of High Capacity Wireless Infrastructure, Pimpri-Chinchwad, Maharashtra, India (34)
• Municipal Geographic Information System (GIS), Surat Municipality, India (35)
• Smart Poles and Streetlights, Bhopal, Madhya Pradesh, India (36)
• Mandaluyong City Market, Manila, Philippines (38)
• Aquanova America, Saint-Dié-des-Vosges, France (54)
• Akaretler Row Houses, Istanbul, Turkey (56)
• Challenging Case: Jal Mahal Palace in Jaipur, India (57)

The World Bank’s Municipal Public-Private Framework Case Studies includes around 100 Project Summaries with examples of commercial value capture in various sectors and from countries around the world. Below is a list of projects and project summaries which has commercial activities associated with core services.  To find more see Municipal Public-Private Partnership Framework.

List of Projects with Commercial Activities Associated with Core Services

• Moncloa Transportation Exchanger, Madrid, Spain (1)
• Hong Kong Mass Transit Railway Corporation, Hong Kong SAR, China (2)
• Sheberghan City Bus Terminal, Sheberghan, Afghanistan (4)
• Modern Bus Terminal and Municipal Market, Danli, Honduras (5)
• Challenging Case: Bus Terminal-cum-Commercial complex, Mohali, India (6)
• Challenging Case: Amritsar Intercity Bus Terminal, Punjab, India (7)
• Challenging Case: Bus Terminal and Commercial Complex, Dehradun, India (8)
• Challenging Case: Urban Transport Services, Peja, Kosovo (9)
• Pulkovo International Airport, St. Petersburg, Russia (11)
• Tecon 1 Container Terminal at Suape Port, Pemambuco, Brazil (13)
• Challenging Case: Doraleh Container Terminal, Djibouti (14)
• Integral Treatment of Wastewater and Bio-Solids, Municipality of Saltillo, Mexico (25)
• Industrial Water Supply, Surat Municipal Corporation, India (26)
• Municipal Waste Thermal Treatment Plant, Poznań, Poland (27)
• Solid Waste Management, West Bank and Gaza (30)
• Next Generation Nationwide Broadband Network, Singapore (32)
• Free Public Wi-Fi and Interactive Kiosks Project, Kansas City, United States (33)
• Establishment of High Capacity Wireless Infrastructure, Pimpri-Chinchwad, Maharashtra, India (34)
• Municipal Geographic Information System (GIS), Surat Municipality, India (35)
• Smart Poles and Streetlights, Bhopal, Madhya Pradesh, India (36)
• Sports Hub, Singapore (51)
• Ricoh Coliseum at Exhibition Place, Toronto, Canada (52)
• Campin Coliseum (Movistar Arena), Bogota, Colombia (53)
• Aquanova America, Saint-Dié-des-Vosges, France (54)
• Düsseldorf Museum, Kunstpalast, Germany (55)
• Akaretler Row Houses, Istanbul, Turkey (56)
• Challenging Case: Jal Mahal Palace in Jaipur, India (57)
• Elbphilharmonie, Hamburg, Germany (58)
• Street Lighting Project, Nasik, Maharashtra, India (67)
• Energy-efficient Street Lighting, Bhubaneswar, Odisha, India (68)
• Durban Point Waterfront Development Project, EThekwini, South Africa (71)
• Croydon Council Urban Regeneration Vehicle, London Borough of Croydon, United Kingdom (72)
• Capitol Crossing, Washington, District of Colombia, United States (75)
• Mixed Use Development, Virginia Beach, Virginia, United States (78)
• Kenyatta University Hostels, Kenya (92)
• Challenging Case: Hemodialysis Centers, Dhaka and Chittagong, Bangladesh (96)
• Hemodialysis Center at the National Kidney and Transplant Institute, Quezon City, Manila, Philippines (97)
• Dialysis Services in Andhra Pradesh, India (98)

These Guidelines are primarily intended to provide governments with a strategic and holistic understanding of how the demand-side participants of the global emission reduction credit (ERC) markets perceive local policies and institutions in their ability to support the generation of high-quality ERCs.

For this reason, these guidelines take the view of parties, across both private and public entities, intending to invest in or purchase emission reduction credits from the target country and lay out the policy and institutional components that will be critical for such parties to make their investment and purchase decisions. Visit Objective of these Guidelines to learn more. 

The Country System Assessment Framework was developed to address the overall objective of enabling international ERC-based financing from the generation, monitoring, and monetization of local ERCs.The Assessment Framework enables comprehensive evaluation of the given country’s ERC policies and institutional arrangements, and is followed by the Assessment Process to ensure that policy recommendations for ERC development and implementation are well-informed and aligned with the country’s decarbonization goals.

The World Bank Emission Reduction Program (ERP) aims to help countries leverage the benefits of Emission Reduction Credits (ERC) markets, including increased revenue streams, reduced emissions, and improved environmental sustainability.

In this Section you will find an introduction to Emission Reduction Credits and learn how they can be a key component of a country’s strategy to attract climate finance and capital for the development and protection of communities and ecosystems.

Emission Reduction Credits Classification is relevant for how the units are transacted. ERCs can be classified by their crediting mechanism through which they are supplied and market segment characterizing where they are purchased and by the ERC activity. 

Demand for ERCs spans different market segments, each with a distinct set of policy considerations. Click here to learn more about International Compliance Markets, Domestic Market-based Carbon Pricing Instruments, Voluntary Carbon Market and Results-based Finance with the purpose of incentivizing climate change mitigation or meeting Nationally Determined Contributions. 

To access the Guidance for Countries in Assessing ERC Projects, Country System Assessments or the Mobilizing ERC Finance, visit the main landing page for this section: Unlocking Global Emission Reduction Credit.

Find a list of helpful terms used in the Mobilizing ERC Finance Section.

Political risks are acute for ERC activities and arguably the most important and challenging to address to attract capital. ERC markets are fundamentally policy driven and still relatively novel, trading a credit that may not yet be considered by, let alone be clearly defined, in existing regulatory frameworks. Uncertain policy and regulatory frameworks, as well as unexpected government action, policy change including expropriation, or foreign investment restrictions, fundamentally put at risk the ability of an ERC activity to generate and transfer ERCs from a given jurisdiction. Several political risks are particularly salient in the context of ERC markets, largely arising from the fact that ERCs are a new type of product (and indices are beginning to emerge which allow VCM participants to assess country opportunity and risk¹). Therefore, uncertainties exist in many countries, including with respect to legal and regulatory frameworks, clarity on rights to ERCs, and to what extent governments want to domestically retain ERCs for national-level commitments. Key issues include:

• ERC regulatory frameworks – A substantial number of policy and regulatory decisions are required for countries to effectively engage in domestic and international ERC markets. Uncertainty around the requisite frameworks creates a broadly challenging context for ERC developers and investors. Policy clarity is particularly important for:
  • ERC Rights – The definition of the legal nature of ERCs and required processes for engaging with relevant interest holders, such as landholders, local authorities, financial institutions, and IPLCs. Without this clarity, there is a heightened risk of potential inconsistencies or conflicts with stakeholders, which can arise where rights to ERCs are not clearly defined and protected. The legal nature of ERCs in a particular market also has consequences on tax treatment, risk weighting, and capital costs that may affect a financial institution’s ability and willingness to finance ERC activities and hold ERCs on its balance sheet.
  • Transferability – Implementation of compliance markets, including domestic carbon pricing schemes and Article 6, as well as decisions with respect to whether and how VCM activities are integrated into domestic carbon pricing and Article 6 policy frameworks. This includes requirements and processes for authorization and corresponding adjustments.
  • Beneficiaries – Approach to benefit sharing arrangements with the government or IPLCs.
  • Institutional ownership – Policy should also serve to clarify institutional ownership of ERC regulatory frameworks. Roles and responsibilities related to ERC markets should be clearly defined and understood across different governmental entities (e.g., Ministry of Environment, Ministry of Finance, etc.).
• Article 6 authorization – Most countries have not clarified their process for authorizing international transfer of mitigation outcomes in line with Article 6 of the Paris Agreement. Some have begun to issue letters for specific ERC activities confirming the authorization, intended authorization, or no objection to the sale of associated ERCs generated. To date, the letters are simple, without detailed contractual agreements with respect to terms for dispute resolution or payments for breach of contract. This creates uncertainty around the ability to transfer ERCs out of a host country and into the larger global market.
• Export restrictions – Some countries have taken steps to prevent or restrict ERC exports while developing a policy framework governing ERCs (e.g., Indonesia).² Policy positions of this nature can pose a short-term barrier to project developers and financiers by enhancing uncertainty and the risk profile of ERC transactions regarding future ability to trade ERCs. However, if the pause results in the countries developing a clear policy framework affecting ERCs, then greater policy certainty may be beneficial in the long term.
• Government retention of benefits –Host governments may seek to retain mitigation outcomes achieved by ERC activities for the purpose of meeting their own NDCs or retain a share of revenues generated by ERC activities (Box 6). This could be implemented through requirements that a certain proportion of ERCs issued by an activity are retained by the host government, and at the extreme prohibiting any export (e.g., Papua New Guinea),³ or taxing revenues from the sale of ERCs (either domestically or internationally). It will be important for governments to consider that such policy approaches will be relevant for project developers and financiers in assessing activity feasibility and selection of preferred markets to enter and will affect the level of investment needed to operate and maintain the project. Additionally, to the extent governments claim ERC benefits from voluntary ERCs (i.e., ERCs not authorized under Article 6) to meet their NDCs, it could impact the claims that can be made by the buyers of the ERCs.

Among many steps governments can take to improve the ERC policy environment, steps to clarify an ERC activity’s fundamental ability to generate, own, and transfer ERCs are arguably most important from a financier’s perspective. Even with these basic elements in place, ERC developers and financiers can benefit from effective public sector engagement and ERC financing may further benefit from ERC-focused political risk insurance. 

Read more on:

Rights to ERCs and Their Benefits

Cross-border ERC Trade

Government Engagement and Public Sector Participation

Political Risk Insurance

Footnote 1: See, for example, Trove Research, “VCM Country Opportunity and Risk Index" (2023), which quantifies seven risk factors (corruption, rule of law, land tenure, climate policy uncertainty, business environment, governance and political stability), and four measures of carbon trading risk (domestic market and taxes, trading restrictions, corresponding adjustments, and national registry issues).

Footnote 2: In 2022, Indonesia introduced a short-term pause on new ERC issuances. See: World Bank, State and Trends of Carbon Pricing 2023, 2023.

Footnote 3: In 2022, Papua New Guinea introduced a moratorium on all new ERC activities. See: World Bank, State and Trends of Carbon Pricing 2023, 2023.

Footnote 4: Carbon Pulse, “Zimbabwe voids all existing carbon offset agreements, lays claim to half of future proceeds – report”, 2023

Footnote 5: Carbon Pulse, “Zimbabwe backs down from carbon deals bonfire threat – report”, 2023.

Footnote 6: Carbon Pulse, “Zimbabwe voids all existing carbon offset agreements, lays claim to half of future proceeds – report”, 2023

Footnote 7: Reuters, “Zimbabwe to regulate carbon credit market to curb greenwashing”, 2023.

Footnote 8: Carbon Pulse, “Zimbabwe backs down from carbon deals bonfire threat – report”, 2023.

Footnote 9: Carbon Pulse, “Zimbabwe eyes pan-African carbon trading registry as it prepares to host VCM summit”, 2023.

These sections provides an overview of key findings to attract commercial investment for ERC activities and help scale ERC finance, including examples of how the bond or debt raise could be used to finance ERC activities. For smaller economies and many subnational entities, an aggregation facility that pools multiple ERC activities can help overcome some of the challenges to accessing finance and attract large-scale private sector capital, including through issuing ERC-backed debt.

Through a series of working group meetings and additional consultations with experts in the field of ERC finance, the World Bank ERP Finance Working Group identified four key risks that influence ERC transactions (Figure 10) and the most effective or promising tools or approaches for mitigating those risks. ERC generation as an economic activity and the associated technologies and practices remain unfamiliar to most financiers, and the market is still small and shallow and is fundamentally policy driven. When considering ERC activities, financiers are particularly focused on addressing credit, operational, market, and political risks. Governments, project developers, development finance institutions (DFIs), insurers, commercial financiers, and concessional financiers have a range of options to address these risks and mobilize ERC finance. This chapter highlights some of the key enablers (Table 2) to consider when structuring ERC activities and finance, because they have been demonstrably used in recent financial structures that are successfully tapping into capital markets and international investors, including those highlighted in Financing structures to address key risks, or they are enablers that potential financiers broadly acknowledge would help scale up private-sector ERC financing. While each of these enablers can be effective at addressing key risks that affect an ERC transaction, they are ultimately insufficient without the support of clear and consistent policy frameworks to guide how ERC markets are regulated. There are several efforts to further the development of these frameworks and enhance regulatory capacity, especially in emerging markets.¹

Figure 10. Key ERC-related risks for financiers.

Table 2. Summary of spotlighted enablers of ERC financing, the types of risk they address, and for which case studies (ERLB, FSF, or LCF3) they were most relevant based on publicly available information.

Footnote 1: See, for example, World Bank, Partnership for Market Implementation (PMI), 2023; VCMI, VCM Access Strategy Toolkit, 2023; UNDP, Carbon Payments for Development, 2023.

Though the ERC market is still in the lower half of its financing curve, see Figure 5, there are some promising examples of financial structures that have successfully tapped into capital markets or a highly diverse base of international investors.

Most have raised capital on a small to moderate scale (e.g., up to about $150M). While not yet reaching the scale required to meet the increasing demand for ERC financing, various examples demonstrate promising elements of financing structures to address key risks that could be used in other contexts to help unlock greater levels of private sector finance.

Overviews of three recent examples that demonstrate some of the latest advances in structuring ERC finance comprise the remainder of this chapter.