Just ask the investors: businesses in emerging markets can no longer afford to ignore the risks posed by the changing climate to their bottom lines. Ranging from increasingly frequent and severe weather events to new regulations and changing consumer preferences, climate change is fundamentally transforming the way we do business. Increasingly, companies and their investors are seeking opportunities to transition to and invest in climate-smart portfolios.
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With the passing of the historic climate change agreement in Paris, the buildings sector, which accounts for 32 percent of total energy use and 19 percent of GHG emissions, has been highlighted as a key industry to transform in order to achieve global climate mitigation goals. The private sector has responded with ambitious pledges for action, and must now turn to practical solutions to put the building sector on a low-carbon path.
The good news is that the level of aspiration is very high. I participated in the first-ever Buildings Day at COP21, witnessing ambitious commitments from both the public and the private sector. Over 90 countries have included attention to buildings in their Nationally Determined Contributions (NDCs), with greater than 1,300 commitments from companies and industry and professional organizations.
We’re doing a lot of talking and listening here at COP 20 in Lima about climate finance – how hundreds of billions of dollars were invested globally last year to clean up the air, get efficient energy to more people, make agriculture more productive, and build resilience to extreme weather events.
We all know and acknowledge much more still needs to be done – the International Energy Agency and others believe we need at least $1 trillion dollars of new investment each year to address climate change.
There’s no way that public money alone can meet that goal. We need to find ways to catalyze the limited public funds we have to unlock private investment. That, of course, means investors need to have the confidence that the right policies are in place to make long-term investments for the climate.
While green buildings, by their most obvious definition, address environmental impacts, they also have wide implications for human health, safety and productivity. Well-ventilated green schools can reduce instances of asthma in students. Green offices with day lit spaces boost employee productivity and attendance. Patients heal faster in green hospitals with views to nature.
On Monday, Sept. 17, a chorus of voices from around the world spoke out in support of “Green Buildings for Great Communities,” the theme of this year’s World Green Building Week, hosted by World Green Building Council. Green building councils from 90 nations organized hundreds of events to educate the public about the health, environmental and economic benefits of sustainable design and construction.
CHF International (Cooperative Housing Foundation), which serves millions of people in low- and moderate-income communities around the world, hosted a panel in partnership with the U.S. Green Building Council (USGBC) called “Cities and Climate Change Adaptation: What We Can Learn About Resilience from Those Living on the Edge.” The panel featured Judy Baker, lead economist in the Urban Practice at the World Bank Institute; Brian English, director of program innovation for CHF International; Aram Khachadurian, an international development consultant; Helen Santiago Fink, urban climate change advisor for USAID; and Janice Perlman, an independent scholar, teacher and consultant, who discussed resiliency in the built environment and its role in addressing the plight of the urban poor.
They inhabit two different worlds—buildings and climate change—both outside and within the World Bank. It should not be that way as the building sector could be central to both mitigation and adaptation efforts.
Buildings are important for climate mitigation because they account for about 30% of global energy consumption and greenhouse gas emissions. According to the International Energy agency (IEA), energy use in this sector is expected to increase globally about 30 % over the next two decades if recent trends continue; however, the Intergovernmental Panel on Climate Change (IPCC) Fourth Assessment Report concludes buildings offer by far the largest potential source for low cost reductions in CO2 emissions. The World Bank has many projects and analyses addressing this opportunity including a recent ESMAP (Energy Sector Management Assistance Program) report on the benefits and obstacles to effective building codes. These could address over 60 % of building energy use but remain weak and often unenforced in most Bank client countries.