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Clean energy

Behind the Numbers: China-U.S. Climate Announcement's Implications for China’s Development Pathway

Xueman Wang's picture
Solar cell manufacturing in China


The past five weeks have given us what may be defining moments on the road to a Paris agreement that will lay a foundation for a future climate regime.

  • On October 23, European Union leaders committed to reduce greenhouse gas emissions by at least 40 percent by 2030 and increase energy efficiency and renewable energy use by at least 27 percent by 2030.
  • On November 12, during the APEC Summit in Beijing, Chinese President Xi Jinping and United States President Barack Obama jointly announced their post-2020 climate mitigation targets: China intends to achieve peak CO2 emissions around 2030, with best efforts to peak as early as possible, and increase its non-fossil fuel share of all energy to 20 percent by 2030; and the U.S. agreed to cut emissions by 26-28 percent below 2005 levels by 2025.
  • On November 20, at the donor conference in Berlin, led by the U.S., Germany, and others, donors pledged about US$9.3 billion to the Green Climate Fund (GCF).

China’s announcement in particular is considered by many to be a game changer. China, the world’s biggest emitter with its emissions accounting for more than 27 percent of the global emissions, is setting an example for other major developing countries to put forward quantifiable emission targets. The announcement will hopefully also brush away the “China excuse,” used by some developed countries that have avoided commitments on the grounds that China was not part of action under the Kyoto targets.

Home is Where the Hearth Is

Anita Marangoly George's picture
Home is where the heart is. It’s also where the hearth is. And for the three billion people around the world who cook every day using traditional fuels, the hearth has a very dark side. Dirty, smoking cookstoves are responsible for killing over four million people a year. In fact, it is the fourth leading cause of death in the world. This was the message of former U.S. Secretary of State Hillary Clinton, one of numerous global leaders to highlight these alarming facts at the Cookstoves Future Summit in New York City last week.

She and leaders of governments, companies and organizations like the World Bank Group were gathered to pledge record amounts of finance and country-level actions to tackle the insidious health and environmental challenges posed by the simple act of cooking.
 
Photo by Romana Manpreet and Global Alliance for Clean Cookstoves

Growing up in India, I have always been conscious of the daily grind that women and girls in remote, rural areas go through just to prepare one meal. There’s the long, arduous and sometimes dangerous walk to get firewood, sticks or charcoal – whatever one can afford to find or buy. There’s the walk home, loaded down with that fuel. This can take up to five hours in rural areas – time that could be spent at school, work or building a small enterprise. And then of course, there’s the time spent breathing in smoke as they cook an often simple meal of bread, rice, lentils or vegetables. In India alone, more than one million deaths a year are attributed to traditional cooking practices - a shocking figure by any reckoning.

Racing to a Competitive Economy: China Pursues High GDP, Low-Carbon Growth

Xueman Wang's picture
Also available in: 中文

 Yang Aijun/World Bank

December 2009 does not seem so long ago. The UN climate conference in Copenhagen had just come to a disappointing end, and I headed home feeling depressed.  I returned to China for holiday and was surprised to see the widespread awareness of climate change and the collective sense of urgency for action. The concept of "low carbon" was discussed in all major and local newspapers. To my amazement, I even found an advertisement for a "low carbon" wedding. I finished my holiday and went back to Washington with optimism and hope: Despite the failings of Copenhagen, China, the biggest emitter in the world and the largest developing country, was going through a real transformational change. China clearly saw action on climate change as serving its own interest and as an opportunity to pursue a green growth model that decouples economic development from carbon emissions and resource dependence.

In the past five years, the world has witnessed the emergence of China as a leader for tackling climate change.  A few weeks ago, colleagues at the World Bank Group heard an evidenced-based presentation by Vice Chairman Xie Zhenhua from the National Development Reform Commission (NDRC) of China, who showed what China had done in the past, is doing now, and plans to do in the future. He shared his candid assessment of the challenges, mistakes, and lessons learned from China's experience.

China’s progress is impressive. Between 2005 and 2013, average economic growth has been above 8 percent while the country’s emissions intensity has decreased by 28.5 percent compared with 2005 levels. This equates to emissions reductions of 23 million tons of CO2. These reductions were achieved through massive closures of inefficient coal fire plants, aggressive energy efficiency programs, expanding the renewable energy program, and large investments in clean technology.

While these numbers are impressive, sustaining them will be harder. Over the last 10 years, China has targeted its "low-hanging fruit" for mitigation options. The challenge today is how China will sustain annual GDP growth of more than 7 percent while continuing to reduce its economy’s emissions intensity.

Climate Tech in Ethiopia? Yes!

Michael Ehst's picture



This week marks the launch of the new, World-Bank supported Ethiopia Climate Innovation Center (CIC). The center joins a global network of CICs and is designed to support local Ethiopian businesses that are responding to the challenges of climate change by providing mentorship, financing, access to markets, and policy support.

Dealing with Uncertainties in Energy Investments

Uwe Deichmann's picture

 John Hogg/World Bank

According to the International Energy Agency (IEA), global energy demand is likely to grow by more than one-third between now and 2035. Mobilizing investment capital is one major task. Additionally, energy infrastructure such as electric power facilities has a long time span – up to 40 or 50 years in the case of base-load nuclear or coal plants. As the new Growing Green report, released by the World Bank’s Europe and Central Asia Region, points out, with such a long time span and the enormous amount of capital at stake, power sector investments need to consider at least three types of uncertainties—changing regulations, changing technology, and changing climatic conditions.

Regulatory Uncertainty

Regulatory uncertainty persists in countries without formal greenhouse gas emission restrictions. Even in the EU, the emissions trading system is still evolving and future prices for carbon emissions will in large part depend on political decisions. Such schemes may spread to other parts of Europe and Central Asia as the implications of climate change become more apparent and support for climate action rises. A price on carbon, either through a cap-and-trade sys¬tem or a tax, can profoundly alter the comparative economics of different power generation technologies. With a price on carbon emissions, the cost differential between fossil-fuel plants and low-carbon alternatives shrinks and in some cases disappears.

Many international firms and banks already incorporate an assumed carbon price into their financial investment feasibility calculations. Expectations of future carbon pricing have already altered investment decisions favoring natural gas over coal-fired power plants in the U.S. (although more recently the drop in gas prices has been a larger factor). Conversely, regulatory uncertainty also hinders investments in low-carbon generation. The IEA estimates (pdf) that uncertainty in climate change policy might add a risk premium of up to 40 percent to such investments, driving up consumer prices by 10 percent.

Make a Wish: Climate Change or Energy Poverty

Mats van Kleef's picture

Make a WishIf you could have just one wish, would you choose to solve climate change or energy poverty?

Resolving these two calamities is fundamental to the wellbeing of the planet and people. Climate change is caused mainly by the consumption of energy and the associated greenhouse gas emissions. Energy poverty is the lack of access to modern energy services. Helping 1.3 billion people access electricity and 2.6 billion people to have clean cooking facilities will greatly increase the world’s energy consumption and resulting GHG emissions. Spending money to mitigate climate change uses valuable resources that could more directly benefit the poor who have so little energy and such unhealthy cooking facilities. How do we address both energy poverty and climate change? This is as much an ethical dilemma as a technological challenge.

A visit to Pennsylvania gasland

Robert Lesnick's picture



Whether it be from The Wall Street Journal, or YouTube, by now most of us have heard the arguments for and against development of “shale gas”, and as a member of the World Bank’s Oil, Gas and Mining Unit, hardly a day goes by that I do not receive a notice about an article, a presentation or a conference on this topic.

Potential Future Impacts of Increased Biofuels Use

Govinda Timilsina's picture

This entry is part of a series of posts written by members of the Environment and Energy team of the World Bank's Research Group on economic and policy issues involving energy and climate change mitigation.

Ongoing controversy has surrounded production of crop-based biofuels, ostensibly for the purposes of increase renewable energy use and reducing carbon dioxide (CO2) emissions that causes global warming.   To illustrate, a recent report on price volatility in food and agricultural markets prepared by numerous international organizations, including the World Bank, at the request of G20 Governments recommended elimination of current national policies that subsidize or mandate biofuels production or consumption. Some international non-governmental organizations, such as Action Aid strongly supported the recommendation, while some other organizations, such as Renewable Fuel Association opposed it. The June meeting of G20 agriculture ministers did not make any decision in favor or against biofuels, deciding instead to have further analysis.

Green jobs for Africa

Daniel Kammen's picture

At a meeting of the Clean Investment Funds Partnership Forum in Cape Town there was a telling comment in a session I chaired on climate change science when a participant from the Ministry of Energy in Ethiopia got up and said, “I am glad we are talking about the tools that are available for community planning for low-carbon development, but everyone in the rural areas of East Africa sees that the climate is changing.  My mother tells me every season the rains and temperatures are different then when she was young.”

So what to do?

Putting more energy in and money towards the manufacturing of innovative green technologies is key: exploiting the wind or sun without solar panels and turbines is like trying to catch fish without a net or rod.  Africa is poised to manufacture the ‘nets’ for clean energy.

Opportunities exist at many scales of activity: from village-level programs to manufacturing improved efficiency woodstoves, to building the hardware and knowledge systems to construct local ‘mini-grids’, to national efforts and global partnerships for large-scale manufacturing.  The multinational development community can help, and is ramping up activities like the Scaling Up Renewable Energy (SREP) program that was a focus of partnership meeting on the Climate Investment Forum.   China is investing heavily in Africa at the moment, and local manufacturing and national capacity building can be part of that equation.

I chaired a session on Scaling up Manufacturing at which the panelists told remarkable stories about these opportunities.  Stimulating the green energy industry creates jobs, said Dan Gizaw, a founder of Canton, Michigan-based Danotek, a company that manufactures permanent magnet generators for wind turbines. Gizaw is from Ethiopia, and the company established manufacturing facilities there. “Manufacturing wind turbines and turbine components locally, has a job creating advantage you don’t have when you import them. We have created 475 jobs with our factory.”

Come to this Malaysian province to see an alternative path on energy

Daniel Kammen's picture

 

   Photo courtesy Willem V.
   Strien/Flickr under Creative
   Commons License

It is all too easy to see environmental protection and economic development simply as competing philosophies, and nothing more. A range of studies attest to the fact that this is a false dichotomy. In my earlier blog, I described the alternative vision that became a reality in a small Nicaraguan coastal community that chose to invest in a diverse set of clean energy alternatives.  Even with cases like this one described in the literature, there remains in some circles a sense that these must be concocted.

 

The headlines often reinforce this simple dichotomy of environment versus economic growth, where the choice presented is “preserve a forest and forego the lumber”, “save a river and deny a community hydropower”, or “find the financing for more expensive solar power or accept ill-health and global warming from coal.” I have been convinced that another path or paths exist, ever since reading a remarkable paper on the `valuation’ of a tropical rain forest (Peters, Gentry and Mendelsohn, `Valuation of an Amazonian Rainforest', Nature). This short paper got me thinking about how we ignore the longer-term economic wins of sustainability for short-term profit.

 

I recently had the wonderful fortune to get involved in a case that reinforced the fact that options always exist, if we work together to find them.

 

Early in 2010, a consortium of citizens from Sabah, Malaysia came to my laboratory at the University of California, Berkeley, convinced that unexplored options must exist to provide the energy needed for this Malaysian Province without placing a 300 MW coal fired power plant on the edge of the ‘coral triangle’ off the coast of North Borneo. This plant was planned at a site only 20 kilometers from the last remaining reserve for the critically endangered Sumatran Rhino of Borneo (of which there may be only 30 individuals or so remaining). This plan would have required the weekly import of coal from South Borneo (Kalimantan). Just a few years ago, the coal plant seemed inevitable.


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