WASHINGTON (CMC) – The Inter-American Development Bank (IDB) says it is joining forces with the United Nation’s Green Climate Fund (GCF) to create the first regional fund to promote electric mobility and green hydrogen in Latin America and the Caribbean.

According to the IDB, the fund is expected to provide US$450 million in concessional loans and grants to nine countries.

“The funding will underpin a transition in the region’s cities towards lower carbon emissions and resilient public transportation by accelerating the use of electric and hydrogen-based public transportation and by making urban mobility systems more resilient to climate change,” said the IDB in a statement.

It said the resources will enable this shift in Jamaica, Barbados, Chile, Colombia, Costa Rica, the Dominican Republic, Panama, Paraguay and Uruguay.

“The region’s urban mobility systems are under strain. The COVID-19 pandemic dealt a hard blow to public transportation companies, reducing the number of users and revenue needed to sustain operations, move away from volatile and polluting fossil fuels and transition toward more secure energy sources,” said IDB President, Mauricio Claver-Carone.

“This regional e-mobility fund will provide the financial resources needed to adopt cleaner technologies. It will also boost the resilience of transportation and energy systems,” he added.

GCF Executive Director, Yannick Glemarec, said “GCF is pleased to partner with IDB for the first fund that will promote electric mobility and green hydrogen in the region.”

“Not only will our investment of US$200 million help increase access to low-emission transportation and strengthen the resilience of the urban transport infrastructure, it will provide socio-economic benefits to millions of people in Latin America and the Caribbean,” Glemarec added.

By increasing access to low-emission transportation, the IDB said the programme will eliminate 7.5 million tons of carbon dioxide emissions.

Its climate adaptation measure will directly benefit 1.5 million people and indirectly benefit 9 million, representing nine percent of the entire population of programme countries.

The benefits include lower fossil-fuel import bills, improved public- and private-sector mobility capacity, new green jobs, a fair transition that addresses gender and other considerations, and a power grid that is more resilient to climate events.

The IDB said it and other partners are expected to provide US$200 million of the funding (US$195 million in loans and US$5 million in grants).

The governments of the nine beneficiary countries are expected to provide an additional US$50 million in local partner funds, for a total initial investment of US$450 million.