The world forged a historic climate deal in Paris on Saturday, cheered on and celebrated by people around the world. Getting to that agreement has involved years of work and collaboration that resulted in what many of us thought we would not witness in our life time. The agreement is in—now it's time for us to help the countries we work with to put their Intended Nationally Determined Contributions (INDCs) into action.
Being in Paris was exhilarating. The World Bank Group team was active on many fronts—the support for carbon prices, the Africa Climate Business Plan, our work on renewable energy, energy efficiency and contribution to energy access. How do we waste less, pollute less and do more to promote energy access?
One such initiative that was strongly supported at COP21 was the “Zero Routine Flaring by 2030” Initiative. The one-page text that took almost a year of negotiations and discussion commits endorsers to not routine flare gas in new oil fields and eliminate ongoing “legacy” gas flaring as soon as possible and no later than 2030. If all oil-producing countries and companies endorse the Initiative, it will make available approximately 140 billion cubic meters of gas each year. If used to generate electricity, this amount of gas could power all of Africa. The Initiative was initially supported by 25 endorsers—pioneers—who recognized ending routine gas flaring as an industry practice is a no brainer and an important contribution that oil and gas companies can make towards addressing climate change. Twenty-two more endorsers have joined since the Initiative was launched to take the total to 47 endorsers representing 100 million tons of CO2 emission reduction each year and more than 40 percent of gas that will no longer be flared. At COP21, Nigeria’s Minister of Environment, Amina Mohammed, announced that Nigeria will endorse the Initiative—great news for the people of Nigeria, especially those who live near flare sites.
(See an inspiring video featuring Faith Nwadishi from Nigeria.)
I hope the Nigerian government’s endorsement will inspire the large corporations operating there to step up and endorse it, too.
I was struck by the numerous discussions around energy at COP21. This makes a lot of sense—the energy sector contributes two-thirds of greenhouse gas emissions. While the shift to renewable energy lies at the heart of the Paris Agreement, developing countries still have to meet their energy needs and most of the 40 percent growth in energy demand by 2040 will come from developing countries. The challenge is meeting this demand without adding to overall emissions.
I believe it can be done. Actually, it has to be done because concerns about global pollution can no longer be disconnected from local pollution. One of the biggest contributors to indoor pollution is dirty cooking with solid fuels and inefficient cook stoves. This was a topic discussed at many events and was front and center on Energy Day at COP21. About 4.3 million people die every year from indoor pollution—more than those that die from tuberculosis, malaria and HIV/AIDS together. The urgency to address this issue was eloquently articulated by Laura Tuck, Vice President of Sustainable Development at the World Bank, in an event hosted by the Government of the Netherlands.
The possibility of finding clean cooking solutions was underscored by the growing success of off-grid and distributed generation evidenced at many COP21 events. Companies like Azuri and Mobisol were awarded for their remarkable work in accelerating energy access by making it affordable through pay-as-you-go systems. The dramatic drop in price of solar and wind energy was the topic of much excitement at the Re-Energizing lunch hosted by the EU Commissioner, IRENA and Ren21. I had an opportunity to speak to Akon, known for his work on providing solar-powered electricity to homes and businesses in West Africa. He told me how within months of having electricity, first-time customers with first-time access, very soon demand better services. He is now working to introduce mini-grids to better service needs of businesses and households in rural West Africa.
Speaking of solar, renewable energy as a mitigant to climate change was discussed alongside energy efficiency of existing systems and consumption. In a short three-minute speech, Laura Tuck spoke of energy efficiency gained by reducing transmission and distribution losses and district heating. She emphasized the Bank’s catalytic role promoting demand-side energy efficiency by helping countries with standards for appliances, green financing and guarantees, attracting commercial banks to lend for energy efficiency and Development Policy Loans that promote energy efficiency.
The Power Africa event I attended brought together many players in the industry, from financiers to developers, energy institutions to civil society representatives. The key message revolved around partnership, creating the enabling environment and supporting a diversified energy mix with different business models. This is with the understanding that without the private sector it will not be possible to take electricity to the 600 million in Africa with no access. Fortunately, the private sector sees the opportunity and many are crowding in using mobile payments and pay-as-you-go systems to make energy available, reliable and affordable.
Another particularly engaging session was on carbon capture and storage, where speakers included highly respected climate change economist Lord Nick Stern, and Dr. Rodolfo Lacy Tamayo, Deputy Minister of Environment from Mexico. The message was clear: 2 degrees Celsius or less of warming cannot not be achieved unless progress is made on carbon capture storage and utilization (CCSU) technologies. Interestingly, the industry is shifting more towards using carbon and converting it to useful products; the lower costs are making it commercially viable. There was a lot of appreciation for the Bank’s work in South Africa and Mexico, and a plea for us to continue to help catalyze governments into mainstreaming CCSU, especially for oil, gas, coal and chemical industries that emit CO2.
The talk about billions of dollars to trillions was the theme of a session with former Vice President of the United States Al Gore, Jeremy Oppenheimer of McKinsey and Sean Kidney from Climate Bonds. Mr. Gore stressed that investors will play a key role in making the shift to a cleaner world. He said large funds are realizing that investing in fossil fuels is investing in future stranded assets. Several pension funds, endowments and corporations are deciding to avoid the uncertainty of fossil fuels. It also helps that prices and returns are today at historical lows.
The possibility of a price on carbon is another deterrent. Several panelists spoke of the private sector’s role as being instrumental in leading the transformation. There was strong consensus that $41 billion of Green Bonds, including $12 billion by the Bank, are simply not enough to fund the trillions needed to fuel green growth, particularly in developing countries.
I ended the week at COP21 with a very inspiring breakfast session hosted by the UN Foundation. Rachel Kyte was introduced as the new CEO for the Sustainable Energy for All (SE4All) initiative, highlighting once more the need to work collectively towards providing energy access to all, doubling the share of renewable energy in the mix, and doubling the rate of improvement of energy efficiency, which also align with the UN’s Sustainable Development Goal 7 on energy.
Being at all these high-octane events was exhausting yet exhilarating, but there was one undeniable takeaway for me: enough talk. Let’s work together to accelerate action and deliver results that will transform the lives of billions through sustainable energy access that also helps to combat climate change.