Reflections on the Paris Agreement at a critical juncture for the CIF

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21 years is a long time. Long enough to raise a child and send him or her off to college. That is how long it has taken to get to the Paris Climate Agreement. The Paris Agreement does set a goal of holding the temperature increase to well below 2C and pursuing efforts to limit the increase to 1.5 C.  The latter goal is in line with what credible scientists have been telling us for a long time (only a 1.5C goal may prevent long-term multi-meter sea level rise, as an example).

The Paris Agreement talks about global peaking of greenhouse gas emissions as soon as possible. It stresses the importance of all countries contributing (through voluntary commitments) to reduce their emissions.  And it proposes raising the level of ambition every five years.
I have chosen to be a development practitioner and that is what I have been doing for more than 15 years. Early on, after seeing droughts, devastating floods and the effects of unpredictable weather – particularly in sub-Saharan Africa - I realized how climate change would compromise and potentially roll back the hard-won economic and social progress made by poorer countries, something I cared and care about dearly.

I witnessed the signing ceremony of the Paris Agreement in New York last April and I did not feel celebratory. And why? Because of the dissonance and contradictions observed between the policies and investments taking place worldwide and the stated ambition of the Paris Agreement. But I realized something else…that climate change was going to impact my daughter’s life in unanticipated and worrying ways. Climate change took a whole new dimension to me since then. I now have three daughters and think constantly about their future and the future of all other children in this world. Because it is important, as Michele Obama has recently said in a World Bank event, that we see our children in other children and that we care for them all. I wake up every day now thinking that I need to do whatever I can to make a difference in terms of ensuring their security, well-being and happiness. And that keeps me very motivated.

We need to realize the urgency, speed and scale of action that is needed and act accordingly. Limiting warming below 1.5 C by 2100 is still feasible but time is running out.  We need to peak emissions by 2020 which means the rapid phase out of coal; a significant acceleration of efforts on energy efficiency; or a fourfold increase in the electrification of the transport sector by 2030, just to mention a few key examples.


Now think about the last time a government, no matter where you are from, passed a new law that was going against established interests of big industries or sectors of the economy and how long it took to get them approved. Or think about that last infrastructure investment – a road, a bridge, or a new major building - you have seen materialize nearby and how long it took. We need political leadership to move away from powering our economies with the energy sources we have been using for more than two centuries; we need to make sure we save a lot more energy which means retrofitting existing buildings and ensuring energy efficiency standards are used in new ones; we need to change behaviors in terms of the way we commute, the way we dispose of waste, the way we consume. And we need to do these “minor” revolutions in a short period of time.

We cannot afford inconsistent and slow policies and we cannot afford to lose time in making sure low carbon and climate-resilient investments are the ones being made. Research[1] shows that in the next 15 years, the world will need to invest around $90 trillion in sustainable infrastructure assets if it strives for a world as described above, surely the world we all want to live in and most importantly that we want our children to live in.  This includes investment in cities, transport systems, energy systems, water and sanitation, and telecommunications. This represents more than the current global stock of infrastructure, most of which will be built in developing countries.

These investments have the potential to bring a lot of benefits but only if they are socially, environmentally and economically sustainable which means with they are consistent with a net zero emissions and climate resilient future world. Failure to align the climate action and infrastructure investment agendas could lock-in technologies, planning models and businesses to a high carbon and low resilience pathway. But research shows that financing costs (equity and debt) are generally much higher in developing countries where the needs for renewable energy and other sustainable infrastructure are greatest.


My 15 years working as a development and climate change practitioner have taught me what it takes to get things done in particular if they imply potential impacts in established interests or if they imply innovation or doing things differently (from the individual to the corporate or systems level). I am very proud to have been engaged for the past six years in the implementation of the Climate Investment Funds to support developing countries make the type of investment choices I was describing above. I am proud because I see us helping countries like Kenya invest in geothermal energy and thereby reducing the costs of electricity to its population; like Morocco invest in concentrated solar power given its great potential, despite it being a more costly technology; like Mexico provide access to finance to local communities (ejidos) to empower them in driving sustainable forest management; countries like Tajikistan support access to credit to small farmers in water efficient and energy efficient agriculture. Because I see how these investments are transforming the lives of people, transforming energy systems and the trajectories of countries.

And when I think about that as well the urgency and scale of action needed, it is very clear to me that we should not be debating whether or not to continue to invest in institutions and mechanisms that have a track record in supporting action in developing countries. We need instead to be debating how to scale up their level of ambition and do it in the most efficient way. Only if we are prepared to take bold decisions today, only if we are prepared to allocate sufficient resources in the short-term through all relevant mechanisms, we can ensure the right investments are made and feel responsible for the outcomes.


Authors

Mafalda Duarte

Head of the Climate Investment Funds

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