Adaptation projects may be difficult to prioritize and finance, as the results of projects are difficult to quantifiably measure and compare across project types, and no singular "unit" for adaptation outcomes exists. The Higher Ground Foundation is developing the Vulnerability Reduction Credit (VRC™), which incorporates cost/benefit analysis and per capita vulnerability equalization tools to measure the outputs of climate adaptation projects. The VRC quantifies in a singular unit measures to reduce vulnerability to climate change. This chapter summarizes the structure and utility of VRCs and shows through a case study from Talle, Niger, how VRCs are created and integrated into Sahelian community adaptations to heterogeneous climate risks such as flooding and droughts. VRC analysis and crediting may serve as a monitoring and evaluation tool and as an instrument to help secure project finance while supporting sustained adaptation. The chapter further considers the potential benefits to governments, donors and economies. VRC financing has advantages over standard development assistance models, particularly for project risk management, project preparation, enhanced transparency of adaptation spend, and scaling of successful pilot projects throughout an economy.
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IntroductionClimate change is happening and it is impacting communities around the world. While all nations will be impacted by climate change, primarily for the worse, the poorest countries face the most human vulnerability.Sub-Saharan Africa is both particularly vulnerable to climate change and lacking sufficient adaptive capacity to address many of the impacts on agriculture, the built environment, health, and other sectors. The economic impact of climate change will be considerable; by the end of the century climate change is estimated to cost 10% of Africa's GDP, and the costs of effective adaptation could be between $US 10 billion and £UK 30 billion per year by 2030 (Pan African Climate Justice Alliance 2009). Africa will bear the highest costs per capita in terms of GDP (Watkiss et al. 2016).In the context of planning processes, research has shown few examples of climate information being integrated into the planning of long-term development. Reasons given for this include short-term development challenges focusing decision-makers' attention on shorter timescales, a lack of both serviceable medium-to long-term climate information and integrated assessments of climate impacts, vulnerability, or adaptation, and a communication mismatch between the producers and users of climate information (Jones et al. 2015).Although expenditures are generally viewed as insufficient, a considerable amount of adaptation investment is already taking place in developing countries. Overseas development assistance is considerable, but the traditional approach (as typified by the Paris Climate Agreement) for financing climate adaptation in developing countries is to set a global monetary target, rather than focus on vulnerability reduction as the measure o...