In the village of Aharkandhi in northeastern Bangladesh, life has changed since homeowners began installing solar panels on their roofs. At night, families gather at the local grocery store to watch TV, which boosts business. Children study longer than before.
This is due in part to a World Bank-financed electrification project to promote off-grid electricity in rural communities. This year, the project became the first renewable energy program in Bangladesh to be issued carbon credits for lowering greenhouse gas emissions and the world's first Programme of Activities for solar home systems under the UNFCCC’s Clean Development Mechanism (CDM) to generate carbon credits.
With access to electricity, people are finding new ways to increase their income, and the word is spreading quickly across villages.
In 2014, Tajikistan applied climate analysis to maximize investments in an aging hydropower system upon which half a million people depend. Morocco continued the phased development of a 500 MW concentrated solar power complex — the first of its kind in Morocco and one of the largest in the world, promising to bring electricity to 1.1 million Moroccans. Indigenous peoples’ groups in Brazil presented and received approval for a $6.5 million plan to advance their participation in sustainable forest management.
These are just a few of the many progressive steps that 63 developing and middle income countries are taking to shift to low carbon, climate-resilient economies with support from the Climate Investment Funds (CIF).
With more than $8 billion in resources expected to attract at least an additional $57 billion from other sources, the CIF is accelerating, scaling up, and influencing the design of a wide range of climate-related investments in participating countries. While this may be only a small portion of the resources needed annually to curb global warming, the CIF is showing that even a limited amount of public funding, if well placed, can deliver investments at scale to empower transformation.
Five months after the UN Climate Leadership Summit, with its unprecedented call to action for putting a price on carbon, low oil prices have provoked governments to look again at whether they have prices right and to consider how to exploit a golden opportunity to reset signals within their economies for lower-carbon growth.
Business leaders in closed-door and public sessions in Davos last month talked of the inevitability of effective prices on carbon and the need for an orderly transition to lower-carbon growth. There was a sense that business, not normally reticent when pointing out how policy can negatively affect operations, needs to use its voice to urge smart, early policy action on carbon pricing. The bottom line was that this price signal will be essential, if insufficient on its own, to steer economies closer to a pathway that can keep warming below 2 degrees Celsius.
The voices were CEOs, from all sectors of the economy and all regions of the world. They recognize the risks climate change poses to their supply chains and businesses.
Last week, we heard those arguments again as organizations that have come together since the summit into a Carbon Pricing Leadership Coalition (CPLC) met to assess progress and plan for 2015.
By Jeff Swartz, Director of International Policy at the International Emissions Trading Association (IETA)
With carbon pricing policies emerging around the world and the recent show of public support for carbon pricing from 74 national governments and more than 1,000 businesses, one piece of the puzzle that needs to be solved is how to connect systems to create an international carbon pricing framework.
In the lead up to the Paris negotiations this December, governments from around the world – including China, South Africa and Russia – have signaled their willingness to apply a price on carbon, yet businesses and civil society know that we will not be able to move towards a fully functional low-carbon global economy by operating under a fragmented system of international carbon pricing policies. Furthermore, the IPCC’s verdict on the need to increase international cooperation on climate mitigation policies highlights the need for an international carbon pricing framework.
By Michael Carter of the University of California-Davis and the National Bureau of Economic Research, and Sarah Janzen of Montana State University
Recent climate-related natural disasters, including droughts, floods and wildfires, have revealed widespread vulnerability of poor populations. Climate-related hazards not only take lives, they destroy homes, compromise livelihoods, reduce crop yields, increase food price volatility, and spawn food insecurity. The inability of poor households to sustain critical investments in child health and nutrition during and after such shocks unfortunately means climate-related hazards are likely to result in permanent deleterious consequences for the next generation.
Contingent social protection measures—which release transfers in the wake of a shock—may improve resilience among the poorest, but the situation is more complex than might first meet the eye. It is not only the poorest who may merit inclusion in contingent social protection schemes. Several recent analyses of droughts show that it is not only the destitute who severely restrict consumption (and undercut investments in child health and nutrition), but also a group of households who hold modest asset stocks. These households, whom we might label the vulnerable, (because they are not destitute, but face the risk of becoming so), face an unpleasant choice. They can sell scarce assets in order to sustain consumption in the face of drought-induced income declines, or they can hold on to their productive assets to avoid being locked into a poverty trap. While their logic of holding on to remaining assets (often called asset smoothing) is unassailable, it induces the kinds of consumption declines that compromise the human capital of the next generation.
Barbara Buchner is senior director at the Climate Policy Initiative and lead author of the Global Landscape of Climate Finance reports.
In December 2015, countries will gather in Paris to finalize a new global agreement to tackle climate change. Decisions about how to unlock finance in support of developing countries’ low-carbon and climate-resilient development will be a central part of the talks, and understanding where the world stands in relation to these goals is a more urgent task than ever.
Climate Policy Initiative’s Global Landscape of Climate Finance 2014 offers a view of where and how climate finance is flowing, drawing together the most comprehensive information available about the scale, key actors, instruments, recipients, and uses of finance supporting climate change mitigation and adaptation outcomes.
New carbon pricing systems are being developed in China, Chile and other countries to help reduce greenhouse gas emissions and encourage clean energy and sustainable development. This will mean new reporting requirements and regulations for an increasing number of national and multi-national companies.
To help corporate leaders prepare, we studied the experiences of three companies that are already operating within one or more carbon pricing systems and the steps they took to prepare for a world where greenhouse gas emissions have a price.
Our report released today by the Partnership for Market Readiness describes the impacts of a changing climate on business strategies, analyzes risks and opportunities as new climate policies are implemented, and distills lessons learned by Pacific Gas and Electric Company, Rio Tinto, and Royal Dutch Shell. The three companies represent a variety of energy-intense industries, including oil, gas, metals, mining and energy generation, transmission and distribution. Two operate in more than one jurisdiction with emissions trading.
Around the world, countries are developing ways to put a price on carbon to fight climate change. They are choosing different approaches depending on their national circumstances. China has pilot emissions trading systems (ETS) in seven provinces and cities and is planning a national ETS in 2016. Chile recently approved a carbon tax to start in 2018. Mexico and Colombia are implementing sector-wide crediting mechanisms that reward low emission programs with carbon credits, for example in the transport sector by substituting conventional vehicles with electric cars. Many countries have renewable energy portfolio standards and feed-in tariffs.
These domestic initiatives are crucial to lowering greenhouse gas emissions. Each is being designed individually, though, creating a patchwork of regulations and missing the economy of scale that a connected system could bring.
The World Bank Group has been working on ways to network these initiatives and facilitate an integrated international carbon market.
This week in London, the Prince of Wales brought together representatives from government, the private sector, and civil society around the goal of protecting and restoring tropical forests. The gathering took stock of forest commitments made at the UN Secretary-General's Climate Summit last September and identified priority actions for 2015 – a critical year for advancing progress on the inseparable issues of development, poverty, and climate change.
With all eyes on a new climate agreement in Paris later this year, healthy forests and landscapes are seen as critical to cutting greenhouse gas emissions to net zero before 2100. The key underlying question is how to best achieve a true transformation in how we manage our forest landscapes, which are still degrading at a rapid rate.
Amy Ericson, U.S. country president for technology company Alstom, spoke at the World Bank Group about the interplay between carbon pricing and innovation that can lower carbon emissions for cleaner, more sustainable development. Alstom is involved in the Carbon Pricing Leadership Coalition.