- Since the Paris Agreement was adopted at COP21 in December 2015, the world has seen increased ambition on climate change. Almost every country in the world has now set national climate targets, and the Agreement has gone into force much earlier than expected. However, global climate action is still not happening at the scale or speed needed to meet the Paris goal of keeping global temperature rise to below 2 degrees Celsius.
- The World Bank Group has been moving quickly over the past year to build on the momentum and lay the groundwork for greater ambition, helping countries reduce emissions and increase resilience to climate shocks through action in high-impact areas, such as clean energy, climate-smart agriculture, disaster preparedness, and natural resource management
- As COP22 starts in Morocco, the Bank Group is aligning its efforts around key focus areas, committing billions to help countries meet their climate goals while leading on critical global issues such as green financing and carbon pricing
It started with the bang of a gavel. Since the adoption of the Paris Agreement in December 2015, the world has seen a year of unparalleled ambition on climate change.
Almost every country on Earth – 190 in all – have now set national climate targets as part of the Paris process. Over the course of 2016, there have been important steps forward on aviation, on short-lived climate pollutants, and on putting a price on carbon pollution. Renewable energy surpassed coal to become the largest source of installed power capacity in the world. To date, 100 countries have ratified the Paris Agreement, bringing it into force on November 4 – much faster than anyone would have expected when it was adopted.
Despite these positive steps, global action on climate change is still far from the level needed to achieve the Paris goal of keeping the rise in global temperature to below 2 degrees Celsius by the end of the century.
Over the past year, the World Bank Group has moved quickly to build on the momentum and set the stage for a new level of ambition, committing billions to help countries meet their climate goals, delivering assistance across sectors, and pushing forward on global issues to reflect the growing international consensus that climate change must be tackled rapidly, systematically, and at scale.
The urgency is driven by the clear threat climate change poses to the achievement of the Bank Group’s overarching goals: ending poverty and boosting shared prosperity. One year ago, the Bank Group warned that without rapid action, climate change could push more than 100 million additional people into poverty by 2030.
In April, the Bank Group adopted a Climate Change Action Plan, based on growing demand for support from client countries. Under the Action Plan, the Bank Group is integrating climate change into all of its work, and expanding commitments in high-impact areas such as renewable energy, energy efficiency, disaster preparedness, and urban resilience.
“The Climate Action Plan is the World Bank Group’s own Paris commitment,” said John Roome, Senior Director for Climate Change at the World Bank. “It allows us to pool our resources from across different sectors and target them for the highest impact, providing countries systematic solutions that reduce emissions and increase climate resilience.”
Over the course of 2016, the Bank Group has stepped up its engagements on climate change and delivered support to countries across a wide spectrum of action, ranging from new financing for solar and wind power to increasing the resilience of urban dwellers, farmers and fishing communities; from helping countries manage their forest resources to facilitating billions of dollars in sustainable investments by the private sector; and from reducing vulnerability in small island states to pushing forward global action on carbon pricing. A list of selected examples of this action is below.
As attention turns to COP22, being held in Marrakech, Morocco on November 7-18, the Bank Group is aligning its efforts around a few focus areas as recently laid out by President Jim Yong Kim. These include facilitating the transition to renewable and low-carbon forms of energy, greening the finance sector, and ramping up global action on energy efficiency.
At the center of these efforts is a push to help countries integrate climate change into their national planning and budgeting and deliver on their Paris climate pledges – the Nationally Determined Contributions, or NDCs.
At COP22, the Bank Group will be announcing progress on the Africa Climate Business Plan, which was launched in Paris. The Business Plan aims to raise $19 billion by 2020 for investments that will strengthen the resilience of the continent’s environment and people, and improve energy access via renewable energy. Much of the funding for the Business Plan will come through IDA, the Bank Group’s fund for the poorest countries.
A new Climate Action Plan for the Middle East and North Africa region will be launched at COP22. This will focus on fostering water and food security in one of the world’s most vulnerable regions, as well as supporting sustainable, resilient and connected cities; encouraging the energy transition; and protecting the most vulnerable communities from climate-related shocks.
“The NDCs are the building blocks of the Paris Agreement, but we know that the current NDCs won’t get us to the ultimate goal of keeping the rise in global temperatures to below 2 degrees,” said Laura Tuck. “That is why it is so important that we help countries to meet their targets quickly, and then to increase their ambitions in the years to come.”
Selected examples of World Bank Group action on climate change since COP21 in Paris:
- In June, Bank Group President Kim announced plans to provide more than $1 billion for India’s ambitious initiatives to expand solar generation. This includes $625 million for a grid connected solar rooftop program, with concessional funding from the Climate Investment Funds’ (CIF) Clean Technology Fund, as well as infrastructure for solar parks, bringing innovative solar and hybrid technologies to market, and transmission lines for solar-rich states.
- In Jamaica, the International Finance Corporation (IFC) supported a newly inaugurated 36 megawatt wind farm, the country’s largest private-sector renewable energy project.
- In Zambia in May, an auction under the Scaling Solar program saw a winning bid of 6 cents a kilowatt hour – the lowest prices for solar power to date in Africa, and among the lowest recorded anywhere in the world.
Energy Efficiency and HFCs
On October 15, parties to the Montreal Protocol agreed to phase down the production and consumption of HFCs, potent greenhouse gases used predominantly in air conditioning and refrigeration. The Bank Group supports this by helping countries phase down HFCs and improve energy efficiency in air conditioning and refrigeration.
- In May, the World Bank’s Board of Directors approved $111 million in new financing to boost productivity in Niger’s agriculture sector and improve its resilience to climate risks.
- In Cameroon, the World Bank is helping to improve the productivity and competitiveness of livestock production systems. The $100 million project aims to build resilience to climate change and improve the nutrition status of vulnerable populations.
- In April 2016, the Bank Group adopted a new Forest Action Plan, which spells out stepped up ambitions on forests. The Plan will promote investments in the forest sector that generate economic opportunities in rural areas, through sustainable forest management as well as responsible forest restoration.
- In Mexico, a program that leverages almost $500 million in World Bank financing is helping rural communities sustainably manage their forests and generate income from forest products, while reducing emissions. The program will cover an unprecedented 30 million hectares, and more than 3,000 communities nationwide.
In June, the World Bank approved $90 million in Development Policy Financing in Vietnam to support a range of green growth and climate change related policy reforms. This was complemented by the Mekong Delta Integrated Climate Resilience and Sustainable Livelihoods investment program, a $310 million operation that will help farmers and fishers by strengthening flood management, providing solutions for soil salinity and protecting coastal areas.
- In Bangladesh, the Regional Waterway Transport Project is improving the navigability of 900 km of inland waterways and connecting routes. The project incorporates climate resilience into river port infrastructure and promotes the use of inland water transport, which emits less greenhouse gases than road transport.
- In Timor Leste, the World Bank is helping to make critical roadways climate- and disaster-resilient, and in the process improving local livelihoods by increasing connectivity and accessibility.
Cities and Buildings
- In July, the World Bank’s Board of Directors approved $150 million for a project supporting urban development, urban transport and climate change resilience in China’s Ningbo Municipality, one of the nation’s fastest-growing urban areas.
- IFC’s investment portfolio for green buildings has now surpassed two billion dollars, including own account investments and mobilized financing. As part of this, the EDGE Green Building Market Transformation Program supports green building codes and standards, finances the construction of green homes, hospitals, and schools, and helps banks increase their green lending.
Reducing Vulnerability and Boosting Climate Resilience
- In October, Bank Group President Kim pledged $2 billion in new financing over three years to help Bangladesh reduce its vulnerability to climate change.
- The Pacific Resilience Program—a series of projects to strengthen Pacific Island countries’ resilience to natural disasters and climate change—was launched in 2016.
- In Jamaica, the World Bank is helping reduce the country’s vulnerability to disasters through the development of a national risk information platform, a coastal risk atlas and strengthened seismic monitoring network, as well as other measures.
Greening the Finance Sector
- The World Bank and IFC are among the world’s largest issuers of green bonds – accounting for more than $2 billion in FY2016.
- In June 2016, IFC supported the first green bond issued by a Turkish bank into the international markets, which was oversubscribed by more than 13 times – attracting more than $4 billion in bids.
- In November, the World Bank announced it had raised $500 million through green bonds to support the financing of global climate action.
Putting a Price on Carbon Pollution
- In April, the High-Level Carbon Pricing Panel, comprising six heads of state and government, two city and state leaders, and the heads of the World Bank Group, the International Monetary Fund and the OECD, called on the world to expand carbon pricing to cover 25 percent of global emissions by 2020 – double the current level – and to achieve 50 percent coverage within the next decade.
- The Carbon Pricing Leadership Coalition (CPLC) – an initiative bringing together over 20 countries and 100 companies to accelerate support for putting a price on carbon, issued an official work plan, announced high level co-chairs, and welcomed new members in 2016. In a communiqué issued in April, it called for global targets for carbon pricing.
- Through the Partnership for Market Readiness (PMR), the World Bank is working with a number of countries to introduce carbon pricing and other instruments to reduce greenhouse gas emissions. In Vietnam, the PMR is helping the government collect data on carbon emissions and build a reporting and verification system. In Morocco, the PMR is helping the government assess needs for policy reform needed to realize their NDC goals using market-based instruments. In China, the PMR is working to provide technical assistance for the design of the national Emissions Trading System.
Credit: The World Bank