Philanthropic funding for climate adaptation and resilience is on the rise.
Global annual funding was at least $600 million in 2023, and it is on track to reach between $650 million and $700 million in 2024, according to a new report by the Adaptation and Resilience Collaborative for Funders.
The group, which includes over 60 organizations, was created last year at COP28 and is run by the ClimateWorks Foundation, a global philanthropic platform. While the organizations surveyed are the biggest in the space, the list is by no means exhaustive. The total funding amount is “likely somewhat higher.”
The report comes during the ongoing COP29 in Azerbaijan. This year, the conference’s key theme is finance, with the goal of setting a new target for how much climate funding wealthy nations will provide developing countries, specifically for adaptation. The old goal of $100 billion per year was set in 2009 and was met two years late, in 2022.
The creation of a new goal is reportedly already resulting in diplomatic tensions in Baku, as a group of countries including Pakistan and several island nations that are bearing the brunt of the climate crisis already are calling for a larger commitment, to the tune of trillions each year.
Philanthropic funding represents just a fraction of what these countries are saying is needed — but the increase represents the growing acknowledgement from both the private and public sectors that adaptation is “unavoidable.” The sector includes a range of solutions spanning from more energy-efficient air conditioning to heat insurance, wildfire detection, and water-level monitoring.
Despite its importance, funding for the adaptation sector so far has been “grossly inadequate,” according to Jessica Hitt, associate director of adaptation and resilience at ClimateWorks Foundation.
“Researchers estimate that only $76 billion was invested in adaptation and resilience across all countries and from all sources in 2022,” she told Latitude Media in an email. “In contrast, the United Nations’ latest findings show that adaptation financing needs in developing countries alone are nearly $400 billion per year.”
While not nearly enough to plug such a wide gap, philanthropic funding can play an important role in attracting further investment, she added.
“It can act as a catalyst to unlock other funding from the public and private sectors,” Hitt said. “Philanthropic funders can support capacity needs across the growing adaptation field, invest in and de-risk innovative early-stage solutions, and pilot new approaches to addressing climate risks and impacts.”
Companies developing first-of-a-kind projects and technologies have a particularly hard time finding the financing they need, with some estimating that the market meets only between 1% and 17% of the need for FOAK financing.
The Adaptation and Resilience Collaborative for Funders came together in December 2023, when 21 funders, including ClimateWorks, the European Climate Foundation, and the Rockefeller Foundation, released a call to action to increase funding in climate adaptation, “seeking to bolster government and private sector action.”
The group has been particularly active in funding solutions for extreme heat; while more subtle than floods and wildfires, heat kills nearly 500,000 people per year and has been dubbed “silent killer.” In July 2024, the collaborative made an initial commitment of $50 million in response to United Nations Secretary-General António Guterres’ call to action on extreme heat.
The Global Cooling Efficiency Accelerator, co-founded by the philanthropic Clean Cooling Collaborative and RMI, is a good example of philanthropic support for adaptation technologies, according to Hitt. The accelerator’s aim is “to bring to market super-efficient air conditioners that are more affordable, widely available, and have a climate impact five times lower than existing ACs,” she said. The increase in AC needs is a major factor in the rise in global electricity demand across the world, according to a recent report by the International Energy Agency.
Another example is a collaboration between the private and public sectors to fund heat insurance for informal workers in India. Other investment areas include financial protection against droughts and floods, infrastructure upgrades in coastal areas, and advanced climate risk modeling and forecasting.
