​The Clean Technology Fund (CTF) is the presently the largest multilateral mitigation fund, with a capitalisation of US$5.2 billion in grants and concessional loans. Its objective has been to harness the private sector in pursuit of 'transformational change' in developing countries towards low-carbon development strategies. Its focus is on financing the deployment of low-carbon technologies at scale. Notably the CTF has had license to channel finance through a range of concessional instruments in order to achieve this goal. The experience of the CTF therefore offers important insights into what it takes to use diverse financial instruments at scale to support developing countries to respond to climate change. 

In addition to seeking to foster innovative approaches to delivering finance at the minimum level of concessionality possible, the CTF has made investments that seek to reduce the costs of promising new technologies, such as concentrating solar thermal power. Its experience reinforces the importance of country context for programmes, and of due attention to issues of institutional capacity and preparedness. 

This Working Paper is one of a series of ODI studies on the effectiveness of international climate funds, using a common analytical framework. It will be revised to reflect feedback received and new developments.

Smita Nakhooda and Amal-Lee Amin