Climate Update # 20 - Calgary Finance
Finance is one of the most powerful tools for both climate mitigation and adaptation. How we prioritize spending can advance or hinder our climate goals. Climate finance is necessary for mitigation, because large-scale investments are required to reduce emissions, and for adaptation, as funding is required to limit the adverse impacts of a changing climate.
The City of Calgary uses two different types of budgets: Capital budgets are used for new infrastructure and for major reconstruction of ageing infrastructure, and operating budgets are used to cover the costs for staff to operate and maintain City infrastructure and services. Budget decisions are guided by City Council’s goals and a variety of technical considerations.
To date, most capital and operating budgets at The City did not include climate criteria. This is problematic because managing the risks associated with climate change and the disruption to City services require adequate funding. Without incorporating climate change criteria into budget and investment decisions we were investing in projects that were taking us in the wrong direction rather than funding projects that manage climate risks and long term costs.
I sat down with Calgary Finance to discuss their work to meet their identified goals in the Calgary Climate Resilience Strategy.
- The City’s investment beliefs statement establishes environmental, social, and governance (ESG) as key factors in investment selection. When selecting investment managers, The City prioritizes managers who have a clearly articulated and proven ESG screening process.
- Through their direct infrastructure allocation, which was increased in the last policy update, The City has invested in two funds that have direct equity investments in green energy such as geo-thermal, wind and solar farms.
- Since 2020, Calgary Finance’s Assessment unit has provided the option for property owners to receive eNotices rather than having their property assessments mailed. As of September 30, 2020, approximately 32,500 property owners have signed up, which is a start. Assessment also worked with City Clerks to create the Evidence Disclosure Portal to enable paperless Assessment Review Board hearings. This reduces the amount of paper used and the travel for residents to attend Review Board hearings, reducing GHG emissions.
- Calgary Finance’s Information Technology unit has made sure that IT managed applications and systems are housed in spaces that have dual-pathed, conditioned (UPS) power and emergency backup power. Simply put, there are at least two power supplies to the servers, so if for some reason there is a failure in one of the units, the other one will take over to prevent the loss of power and services. In a changing climate, this will be vital to ensure that City services are continuing regardless of any damage to a system.
- Faced with a continued economic downturn and the impacts of COVID-19, The City decided to review existing initiatives and look for new solutions to modernize our service delivery. A key component of the Solutions for Achieving Value and Excellence (SAVE) program is to enhance The City's financial sustainability and resilience. The SAVE program included three business cases that were approved by Council that will yield environmental benefits in alignment with the Climate Resilience Strategy: Energy Budgeting, Fleet Operator Management and the Future of Office Work and Footprint reduction.
- Calgary Finances director chaired the Economic Resilience Task Force and put forward three proposals for funding for pilot and review for The City’s Mid Cycle Adjustments: the Reseed Capital Platform, Clean Energy Improvement Program and the Deep Retrofit Program.
What’s not working?
Calgary Finance must continue to find ways to integrate climate resilience criteria within capital budget processes and funding allocation decisions. Calgary Finance has an opportunity to be a leader across The City for raising awareness to other departments, project managers, and business planners on climate change resilience actions and investments to manage climate risks.
Going forward in the next four year business planning and budgeting cycle, Calgary Finance must think critically about how the strategy is governed and integrated with the four year budget cycle. With The City’s realignment, it will be crucial to think about how capital and operating budgets are funded to ensure that projects, departments, and industry are addressing climate resiliency.