AfDB’s Adaptation Benefits Mechanism enters transition phase ahead of 2027 scale-up
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The African Development Bank is moving its Adaptation Benefits Mechanism (ABM) into a transition phase that will run until 2027, marking the shift from pilot development to a permanent secretariat designed to scale results-based adaptation finance across Africa.
AfDB announced the move at COP30 during a session titled “ABM Comes of Age: Transformational Climate Finance in Action”. The transition period will focus on strengthening governance frameworks, advancing methodologies, and expanding participation from governments, corporates, and development finance institutions.
ABM was created to issue Certified Adaptation Benefits (CABs), a standardized unit that quantifies and verifies adaptation outcomes in sectors such as water, agriculture, land use, and climate-resilient infrastructure. CABs are designed to support results-based payments under Paris Agreement non-market approaches, enabling investors to contract and pay for verified adaptation delivery with reduced execution risk.
To prepare for scale, AfDB has opened a call for governments and international organizations to host the permanent secretariat. Pilot-phase structures, including an executive committee, methodology panel, and expert roster, form the base for expanding issuance as CAB methodologies mature and third-party verification systems deepen.
CABs allow performance-based purchase agreements that pay on verified results, creating a revenue stream that can de-risk project finance and complement debt or equity. Potential buyers include DFIs, corporates pursuing sustainability outcomes, philanthropies, and sovereign programmes seeking auditable adaptation impact. Host governments may also leverage CABs to demonstrate progress on national climate commitments and attract blended capital.
Early methodologies cover climate-resilient agriculture, irrigation efficiency, weather information services, ecosystem interventions, and cold-chain or water-resilience systems. As the mechanism grows, CAB offtake agreements could be aggregated into portfolios, securitized, or integrated into blended-finance vehicles, with registry transparency enabling future secondary trading.
Execution risks remain, including methodology readiness, MRV costs, legal enforceability of purchase contracts, and sustained buyer demand. AfDB expects these challenges to be mitigated through strengthened governance, open methodology development, alignment with UNFCCC Article 6.8 guidance, and lower transaction costs under the forthcoming secretariat.
