The Joint Report on Multilateral Development Banks’ Climate Finance is an annual collaborative effort to make public MDB climate finance figures for developing and emerging economies, together with a clear explanation of the methodologies for tracking this finance.
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MDB Climate Finance Hit Record High of US$35.2 billion in 2017
An increase of nearly 30 per cent on the previous year,
boosting projects that help developing countries cut emissions and address climate risks.
Climate financing by the world’s six largest multilateral development banks (MDBs) rose to a seven-year high of $35.2 billion in 2017, up 28 per cent on the previous year.
The MDBs’ latest joint report on climate financing said $27.9 billion, or 79 per cent of the 2017 total, was devoted to climate mitigation projects that aim to reduce harmful emissions and slow down global warming.
The remaining 21 per cent, or $7.4 billion, of financing for emerging and developing nations was invested in climate adaptation projects that help economies deal with the effects of climate change such as unusual levels of rain, worsening droughts and extreme weather events.
In 2016 climate financing from the MDBs had totalled $27.4 billion.
The latest MDB climate finance figures are detailed in the 2017 Joint Report on Multilateral Development Banks’ Climate Finance, combining data from the African Development Bank, the Asian Development Bank, the European Bank for Reconstruction and Development, the European Investment Bank, the Inter-American Development Bank Group and the World Bank Group (World Bank, IFC and MIGA). These banks account for the vast majority of multilateral development finance. In October 2017 the Islamic Development Bank joined the MDB climate finance tracking groups, and its climate finance figures will be included in joint reports from 2018 onwards.
Climate funds such as the Climate Investment Funds (CIF), the Global Environment Facility (GEF) Trust Fund, the Global Energy Efficiency and Renewable Energy Fund (GEEREF), the European Union’s funds for Climate Action, the Green Climate Fund (GCF) and others have also played an important role in boosting MDB climate finance. As well as the $35.2 billion of multilateral development finance, the same adaptation and mitigation projects attracted an additional $51.7 billion from other sources of financing last year.
Of the 2017 total, 81 per cent was provided as loans. Other types of financial instruments included policy-based lending, grants, guarantees, equity and lines of credit.
Latin America, Sub-Saharan Africa and East Asia and the Pacific were the three major developing regions receiving the funds. The report contains a breakdown of climate finance by country.
The sharp increase came in response to the ever more pressing challenge of climate change. Calls to galvanise climate finance were at the heart of events such as the One Planet Summit in Paris in December 2017, two years after the historic Paris Agreement was adopted. Multilateral banks began publishing their climate investment in developing countries and emerging economies jointly in 2011, and in 2015 MDBs and the International Development Finance Club agreed joint principles for tracking climate adaptation and mitigation finance.
Climate finance addresses the specific financial flows for climate change mitigation and adaptation activities. These activities contribute to make MDB finance flows consistent with a pathway towards low greenhouse gas emissions and climate-resilient development, in line with the Paris Agreement. The MDBs are currently working on the development of more specific approaches to reporting their activities and how they are aligned with the objectives of the Paris Agreement.
“For the World Bank Group, 2017 was a record-setting year on climate finance as a result of a deliberate effort over the past few years to mainstream climate considerations into our operations. This upward trend is continuing. The Multilateral Development Banks are also playing a key role in leveraging private sector finance which will be critical to meeting the objectives of the Paris Agreement. Last year alone, the WBG crowded in $8.6 billion in private financing for climate change, which is up 27% from 2016."
John Roome, World Bank Senior Director for Climate Change
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Celebrate World Day to Combat Desertification - #2018WDCD
A wise investment in land supports you and your future. Your choices determine future scenarios for sustainable growth. The 2018 World Day to Combat Desertification (#2018WDCD) urges you to move away from unsustainable land use and make a difference by investing in the future of land under the slogan, “Land has true value – invest in it.”
We often use land as if it were a limitless resource, ignoring its role in our everyday lives. This negligence threatens food and water supply, biodiversity, and even human security itself. Short-sighted economic gains such as land grabbing, unplanned urban sprawl, unsustainable agriculture, and over-consumption lead to unsustainable land use, which eventually causes degradation and loss of critical ecosystem services. As a result, consumption of the Earth´s natural reserves has doubled in the last 30 years, with a third of the planet´s land already severely degraded.
By turning land degradation into land restoration, we can realize the land´s full potential. Healthy and productive land can bring not only environmental but also significant economic gains. For example, case studies from the Economics of Land Degradation Initiative (2015) indicate that:
The annual loss of 75 billion tons of soil from arable land leads a missing opportunity for economic benefits of USD 400 billion per year globally
Taking action against soil erosion over 105 million hectares would save up to USD 62.4 billion in net present value over the next 15 years
Enhancing carbon stocks through agricultural soils alone can create potential value on the carbon market from USD 96-480 billion annually
Burkina Faso: 20 000 trees are planted to create living hedges. Photo Credits:UNCCD
Sustainable land management (SLM) is a wise investment for economic growth that does not compromise resilient livelihoods. It is key to safeguarding and managing the quality of the land by balancing its biological and economic potential. Moreover, land can play a vital role in linking multiple Sustainable Development Goals by harnessing synergies while minimizing potential conflicts and trade-offs. SLM can give tremendous momentum to positive change. By safeguarding life on land, we deliver for all life on Earth.
This is the true value of land.
Every one of us has a role to play. Farmers can invest in smart agriculture that leads to higher yields despite a reduction in inputs like pesticides. Policy makers and land managers can support bio-economy by investing in new SLM technologies and processes. Consumers can spend their money on organic and fairly traded products to avoid land degradation. There are many more ways to invest in land wisely.
Vietnam: Delegates of the WDCD meeting plant 2 000 trees at Dien Bien Dong district, Dien Bien province to promote sustainable land management practices. Photo Credits:UNCCD
We can all contribute to and benefit from investing in SLM – whether we act as consumers, producers, corporations, or governments. Changes in behavior and adoption of more efficient planning and practices can guarantee that sufficient land resources are available long-term to meet our ambitions for and to provide sustainable livelihoods.
The choice is ours. Know the true value of land and invest in it.
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Transition Monaco Forum 2018
Under the High Patronage of His Serene Highness, Prince Albert II, Transition Monaco Forum, a new global platform committed to accelerating the transition towards a clean future across all sectors and industries, will convene global business leaders, policymakers, cleantech experts, and innovators at The Grimaldi Forum in Monaco from June 26-27, 2018.
In response to commitments made during COP 21 and the One Planet Summit, and by developing new business models combining prosperity and sustainability as well as identifying the latest technologies and implementing initiatives for companies to pioneer this change, Transition Monaco Forum aims to accelerate the ecological and energy transition.
The objectives of this exciting new initiative are to form a European hub of investors dedicated to financing the ecological and energy transition and to mobilize key stakeholders across all sectors to find concrete solutions for businesses to develop sustainably.
Gathered in Monaco, a country leading the energy transition, participants will debate the five critical enablers of the cleantech ecosystem: finance, regulation, innovation, cities and territories and new stakeholders.
Speaker Highlights
H.S.H. Prince Albert II of Monaco (Monaco)
Arnold Schwarzenegger, Founder, R20 Regions of Climate Action (USA)
Alzbeta Klein, Director and Global Head, Climate Business, International Finance Corporation (IFC) (USA)
Anne Hidalgo, Mayor of Paris, Chair of C40 Cities Climate Leadership Group (France)
Other confirmed international speakers include:
Olivier Biancarelli, General Director, Tractabel-Engie (France)
Erik Brandsma, General Director, Swedish Energy (Sweden)
Graciela Chichilniski, Economist and Nobel Prize Winner, Columbia University (USA)
Filipe de Botton, CEO, Logoplaste (Portugal)
Matthieu de Chanville, Deputy Head of Alliance Ventures, Renault-Nissan-Mitsubishi (France)
Jérôme Delafosse, Explorer and Expedition Leader, Energy Observer (France)
Rinat Guy, Chief Innovation Officer, Municipality of Tel Aviv (Israel)
Eric Harr, Co-Founder & CEO, Laudato Si'Challenge (USA)
Paul Holthus, President & CEO, World Ocean Council
Margaret Kuhlow, Finance Practice Leader, WWF (USA)
William Kwende, Chairman, Agritech (Burkina Faso)
Claude Nahon, Sustainable Development, Senior Vice President, EDF (France)
Francis O’ Sullivan, Director, Energy Initiative, MIT (USA)
Gunter Pauli, Businessman and Author of the Blue Economy (Belgium)
Nancy Pfund, Managing Partner, DBL Partners (USA)
David Rosenberg, CEO, Aerofarms (USA)
Carlos Sallé, Director of Energy Policies and Climate Change, Iberdrola (Spain)
Riaz Siddiqi, Founder and Managing Partner, Denham Capital (USA)
Sylvain Vanston, Chief Sustainability Officer, AXA (France)
Find here the full conference program and the full list of confirmed speakers
A comprehensive annual overview of the state of renewable energy.
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Transformation is picking up speed in the power sector, but urgent action is required in heating, cooling & transport
Renewable power accounted for 70% of net additions to global power generating capacity in 2017, the largest increase in renewable power capacity in modern history, according to REN21’s Renewables 2018 Global Status Report (GSR). But the heating, cooling and transport sectors – which together account for about four-fifths of global final energy demand – continue to lag far behind the power sector. The GSR, published today, is the most comprehensive annual overview of the state of renewable energy worldwide.
New solar photovoltaic (PV) capacity reached record levels: Solar PV additions were up 29% relative to 2016, to 98 GW. More solar PV generating capacity was added to the electricity system than net capacity additions of coal, natural gas and nuclear power combined. Wind power also drove the uptake of renewables with 52 GW added globally.
Investment in new renewable power capacity was more than twice that of net, new fossil fuel and nuclear power capacity combined, despite large, ongoing subsidies for fossil fuel generation. More than two-thirds of investments in power generation were in renewables in 2017, thanks to their increasing cost-competitiveness – and the share of renewables in the power sector is expected to only continue to rise.
Investment in renewables was regionally concentrated: China, Europe and the United States accounted for nearly 75% of global investment in renewables in 2017. However, when measured per unit of gross domestic product (GDP), the Marshall Islands, Rwanda, the Solomon Islands, Guinea-Bissau, and many other developing countries are investing as much as or more in renewables than developed and emerging economies.
Both energy demand and energy-related CO2 emissions rose substantially for the first time in four years. Energy-related CO2 emissions rose by 1.4%. Global energy demand increased an estimated 2.1% in 2017 due to economic growth in emerging economies as well as population growth. Renewable energy uptake is not keeping pace with this increasing energy demand and the continuous investment in fossil and nuclear capacity.
In the power sector, the transition to renewables is under way but is progressing more slowly than is possible or desirable. A commitment made under the 2015 Paris climate agreement to limit global temperature rise to “well below” 2 degrees Celsius above pre-industrial levels makes the nature of the challenge much clearer.
If the world is to achieve the target set in the Paris agreement, then heating, cooling and transport will need to follow the same path as the power sector – and fast. These sectors have seen:
Little change in renewables uptake in heating and cooling: Modern renewable energy supplied approximately 10% of total global heat production in 2015. National targets for renewable energy in heating and cooling exist in only 48 countries around the world, whereas 146 countries have targets for renewable energy in the power sector.
Small changes are under way. In India, for example, installations of solar thermal collectors rose approximately 25% in 2017 as compared to 2016. China aims to have 2% of the cooling loads of its buildings come from solar thermal energy by 2020.
In transport, increasing electrification is offering possibilities for renewable energy uptake despite the dominance of fossil fuels: More than 30 million two- and three-wheeled electric vehicles are being added to the world’s roads every year, and 1.2 million passenger electric cars were sold in 2017, up about 58% from 2016. Electricity provides 1.3% of transport energy needs, of which about one-quarter is renewable, and biofuels provide 2.9%. Overall, however, 92% of transport energy demand continues to be met by oil, and only 42 countries have national targets for the use of renewable energy in transport.
For these sectors to change, the right policy frameworks need to be put in place, driving innovation and the development of new renewable energy technologies in the sectors that are lagging.
“Equating ‘electricity’ with ‘energy’ is leading to complacency. We may be racing down the pathway towards a 100% renewable electricity future, but when it comes to heating, cooling and transport, we are coasting along as if we had all the time in the world. Sadly, we don’t.”
Rana Adib, Executive Secretary of REN21
“To make the energy transition happen there needs to be political leadership by governments – for example by ending subsidies for fossil fuels and nuclear, investing in the necessary infrastructure, and establishing hard targets and policy for heating, cooling and transport. Without this leadership, it will be difficult for the world to meet climate or sustainable development commitments.”
Arthouros Zervos, REN21 Chair
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We Innovate For Climate Because Our Future Depends On It
In Frankfurt this week, Innovate4Climate brought together climate leaders who recognized and applauded the growth in climate finance and innovation but noted that much remains to be done to scale up action and get on track to meet the Paris Agreement’s 2°C goal.
The big news coming out of #Innovate4Climate was the launch by the Government of Spain of a new initiative to develop next-generation climate solutions. This represents the first step toward facilitating new climate markets using an instrument that addresses the supply and demand of mitigation outcomes, to attract private investors and new sources of financing in line with the Paris Agreement.
There was standing room only at the presentation of the World Bank’s 2018 edition of the State and Trends of Carbon Pricing report and IETA’s GHG Markets Sentiment Survey. The World Bank report shows that coverage of global greenhouse gas emissions by carbon pricing mechanisms is up by 5 percent compared to last year - now covering about 20% of emissions. There’s a growing sense of optimism about the prospects for emissions trading around the world.
“The conference successfully convened key actors on climate finance from both the private and public sector. I am glad to see that the agenda featured resilient investing and insurance-linked solutions to climate risks. These topics will gain prominence as the impacts of a changing climate require us to rethink conventional business models."
Simone Ruiz-Vergote, Managing Director, Allianz Climate Solutions.
Participants brought latest examples of financial innovation, business, technology and policy solutions to accelerate mitigation and adaptation. Sessions on blockchain technology and disruptive technologies to form new systems that save clients time and money drew big crowds, as did presentations at the Pitch Hub on energy efficient lighting and cooking in India by EESL.
With a new optimism and a sense that carbon markets have turned a corner – for example, the average carbon price in the EU’s emissions trading scheme is now above 14 Euros per ton– business is showing renewed interest in investing in climate-smart projects.
“There is new confidence in the air, confidence in market solutions.”
Ingrid Hoven, Director General of Global Issues, BMZ
Photo Credits: Max Thabiso Edkins / Connect4Climate
Tim Jarvis, Environmental Explorer: “Polar expeditions are about heading towards an endless white horizon, and chipping away one step at a time in the knowledge that those steps, when added together, will get you to the goal that you want. And that is the position we find ourselves with climate change and solutions to it. We mustn’t lose heart, we must keep going in the knowledge that the cumulative effort of all of us working together can get us to the end outcome.”
Innovate4Climate is about tapping the ideas and ingenuity of a growing community of business, finance, technology, civil society and policy leaders and increasing their role in driving climate action. Everyone has a part to play: governments, for example, can put policies and MRV infrastructure in place; multilateral development banks like the World Bank can help de-risk climate investments through financial and political guarantees; business can increase the use of private investment capital; and civil society can highlight progress while bringing a voice to the most vulnerable people.
“Climate Change is a challenge but also opens enormous opportunities. To take these opportunities to their full scale, partnerships, innovation and leadership are critical. Governments must provide enabling regulations; MDBs must help mobilize investors by mitigating risks; and the private sector must come in full force with its capacity to innovate and provide solutions.“
Hans Peter Lankes, IFC Vice President for Economics & Private Sector Development
This second Innovate4Climate conference showed, once again, the importance of bringing key climate finance players together to discuss ideas around accelerating decarbonization and presenting concrete solutions and deals.
Photo Credits: Max Thabiso Edkins / Connect4Climate
The World Bank takes an approach it calls “Maximizing Finance for Development” and aims to harness the power of everyone in the room to unlock climate finance. It involves redefining the approach to development finance, by leveraging the private sector in ways that optimize the use of scarce public resources. Meeting the Paris Agreement’s commitments requires investments at unprecedented speed and scale. The financing needs are monumental but so are the opportunities. Emerging market economies will need about $23 trillion to meet the Paris objectives. Unlocking this potential demands forward-looking policies, innovation and investors with capacity to take some risk.
“Blockchain has the potential to truly transform our global supply chains and create disruption but only when used in combination with other technologies to address the needs of society. We all have a role to play in defining those needs and in finding the new business cases to accelerate the transition and affect change,” said Deanna MacDonald, CEO and Co-Founder of BLOC.
There are major challenges ahead, but also solutions and opportunities. The message was loud and clear at I4C: private investment in climate action and green growth is good for the bottom line. And that is a message everyone can get behind.
Governments at national and subnational levels around the world continue to prepare for, and implement, carbon pricing initiatives as a means to curb their emissions while raising revenues, a new World Bank report finds.
More Governments Taking Up Carbon Pricing and Seeing Big Benefits in Revenues: World Bank Report
