Climate change is the most pressing issue of our time, but philanthropy dollars have yet to reflect that urgency. A recent ClimateWorks report tracking climate philanthropy estimated that total philanthropic giving was $750B in 2020, yet less than 2% of that funding ($6-$10B) was focused on climate change mitigation. Most of that funding came from individuals ($4-$8B), while only $1.9B came from foundations.
Although foundational giving to climate change mitigation has been rising (from $900 million in 2015 to at least $1.9 billion in 2020), this growth isn’t enough to keep warming below 1.5˚C. A recent article by One Earth’s Deputy Director, Karl Burkart, outlines the need for $1.5 trillion in yearly funding for a renewable energy transition. The Climate Policy Initiative estimates that as of 2020, there is about $632 billion going to climate mitigation a year from all global private and public sources. That leaves a funding gap of almost $1 trillion.
To help prioritize funding, the ClimateWorks report tracked foundational support across four major areas: Sustainable Energy, Enabling Environment, Cross-Sectoral, and Land Use. Clean Electricity, perhaps the most direct way to reduce fossil fuels, received the highest share at $180 million a year or about 13.6% of the total spend.
However, other important sectors may not be getting the funding they need. Transportation, which makes up ~16% of global emissions, only received 3.8% of foundational climate support. Similarly, energy use in buildings makes up 17.5% of global emissions, but Buildings and Cooling together only made up 4.5% of support.
The ClimateWorks report noted that “there are a wide range of climate solutions that are poised for rapid growth with an infusion of investment... From vehicle electrification to forest protection, clean energy, and other initiatives, there are myriad ways for philanthropy to support solutions that are proven to generate results.”
Though philanthropy will remain a small slice of the total climate mitigation spending, it has a strategic role to play in catalyzing funding across sectors. Our mission at One Earth is to inspire 3x the current climate philanthropic giving by 2025. We believe as ClimateWorks does that, “philanthropy has a major role to play in catalyzing investment in public and private sector solutions, by supporting high risk, early-stage, or politically sensitive work that other sources of capital can’t or won’t fund.”
If we can triple current levels of investment in climate mitigation and focus on funding a rapid shift to renewables, sustainable transportation, and nature-based carbon removal, we have a chance to meet the 1.5˚C pathway and avoid the worst effects of climate change.