In September, the world’s top scientists said the human influence on climate was clear. Last month, they warned of increased risks of a rapidly warming planet to our economies, environment, food supply, and global security. Today, the latest report from the UN Intergovernmental Panel on Climate Change (IPCC) describes what we need to do about it.
The report, focused on mitigation, says that global greenhouse gas emissions were rising faster in the last decade than in the previously three, despite reduction efforts. Without additional mitigation efforts, we could see a temperature rise of 3.7 to 4.8 degrees Celsius above pre-industrial times by the end of this century. The IPCC says we can still limit that increase to 2 degrees, but that will require substantial technological, economic, institutional, and behavioral change.
Let’s translate the numbers. For every degree rise, that equates to more risk, especially for the poor and most vulnerable.
The IPCC makes crystal clear that time is of the essence. The sooner we start to tackle the problem, the better our chances of fixing it and, importantly, the lower the cost.
That sense of urgency was shared by finance ministers who met with the leaders of the World Bank Group, International Monetary Fund, and United Nations at the World Bank on Friday. The ministers didn’t quibble about the science – they talked about risks to economic and financial stability, policy tools they could use to ramp up their low-carbon growth, and the help they need investing in their resilience.
They talked about the message. Often, policies that bring emissions reduction benefits also bring other more tangible benefits. Framing policies their way may expand support. Take transportation: Improving vehicle standards and investing in and increasing the use of public transportation reduces outdoor air pollution that contributes to asthma, heart disease, lung cancer, and 3.7 million deaths a year – and it reduces greenhouse gas emissions. We’ll have a report out looking at some of these “co-benefits” in greater detail soon.
As we head to the UN Climate Summit in September, finance ministers know they must lead action at home that secures resilient growth, delivers jobs, and drives low-carbon growth.
Together, we talked about several actions that can begin to match climate action to the magnitude of the challenge.
• Carbon pricing. This is critical to turning energy use around and driving investment toward low-carbon growth. We are encouraging countries and companies to join a growing coalition of first movers to support putting a price on carbon.
• We are urging policy makers and regulators to drive energy efficiency on a large scale through standards for buildings, lighting and vehicles and to encourage markets for energy efficient solutions. There are jobs to be created here.
• We are advocating for critical investment in low-carbon, resilient, livable cities. The IPCC points out that most of the world’s urban areas that will exist in 2030 aren’t urban today. There is an important for national government in ensuring fiscal policies allow cities access to investment funds as well as ensuring smooth flow of fiscal transfers to city governments. In tandem, we can help with city creditworthiness.
• We are asking countries to follow Africa’s lead and join us to work on goals for enhancing agricultural productivity and nutrition, bolstering farmers’ resilience and reducing greenhouse gas emissions in the way we farm, goals that will make agriculture climate smart.
• We are challenging governments and oil companies, national and independent, to join industry leaders and commit to zero gas flaring globally by 2030.
If public policy can send clear, predictable signals like these and build regulatory certainty, investors will follow. This is critical. For example, the lift-off of the green bond market is impressive. In January, President Kim called for doubling the green bond market to $20 billion by the summit and setting bigger targets for the climate meetings in Lima late this year and Paris in 2015. We’re already moving fast in the right direction, and credit goes especially to the corporate green bond issuers who are expanding the investor base for green assets.That’s just a start, but it can have material impact – and it is doable.
The latest IPCC report also tells us that the later you start to address the climate challenge, the more you must rely on untested technology, and costs go up.
That’s not good economics.
World Bank Group Vice President and Special Envoy, Climate Change
Photo: Government ministers meet with the heads of the World Bank Group, IMF, and United Nations to discuss the challenges climate change is posing for their countries and policy tools they could use to respond. World Bank Photo.