This report examines the urban climate project preparation ecosystem through the lens of partnership, diagnosing why so many climate projects stall before reaching implementation despite substantial support infrastructure.

Cities need USD 4.3 trillion annually through 2030 to meet climate action objectives, yet current flows reach only USD 831 billion. While much attention has focused on the scale of this gap, this research focuses on a less-examined problem: the machinery meant to bridge cities and financiers is not yet functioning efficiently. The report identifies three main elements of dysfunction in the project preparation ecosystem — absent financing flightpaths, a lack of partnering culture, and weak transparency and incompatible standards — and traces these symptoms back to their root causes in misaligned incentives and financier opacity.

The report argues that what is needed is not more support mechanisms, but fundamental restructuring of the incentives, relationships, and accountability systems that perpetuate fragmentation across the ecosystem. It presents emerging practical recommendations for funders, financiers, PPFs, cities, and national governments, spanning structural reforms — such as shifting to outcome-based funding and embedding early financier engagement — and operational improvements, including clearer project financing flightpaths and stronger handover protocols.

The report makes the case that closing the urban climate finance gap ultimately depends on transforming how ecosystem actors collaborate — making partnership a core deliverable rather than unfunded overhead.