Climate Action 2017-2018

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COP23 | Bonn, Germany, 6-17 November <strong>2017</strong><br />

<strong>2017</strong>-<strong>2018</strong><br />

In partnership with<br />

Published for<br />

E N D O<br />

R<br />

S<br />

E<br />

D<br />

E V E N T<br />

Frank Bainimarama<br />

on Fiji’s ambitions<br />

for the COP23<br />

Presidency<br />

Patricia Espinosa<br />

on sharpening<br />

climate action at<br />

COP23<br />

PLUS<br />

Exclusive interview<br />

with the World<br />

Energy Council &<br />

The 15 <strong>Climate</strong><br />

Champions of <strong>2017</strong>


ISBN<br />

978-0-9928020-9-7<br />

Published<br />

November <strong>2017</strong><br />

Founder & CEO<br />

Nick Henry<br />

Commissioning Editor<br />

Jane Nethersole<br />

Editor<br />

Adam Wentworth<br />

Subeditor<br />

John Saunders<br />

Design<br />

Daniel Brown<br />

Printer<br />

Buxton Press<br />

The Publishers wish to thank all the<br />

individuals and organisations who have<br />

contributed to the book. In particular<br />

we acknowledge the following people<br />

from UN Environment for their help and<br />

advice in producing <strong>Climate</strong> <strong>Action</strong>:<br />

Erik Solheim, Naysan Sahba, Catherine<br />

Beltrandi, Sam Barratt and Samantha Le-<br />

Royal. UN Environment do not endorse<br />

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<strong>Climate</strong> <strong>Action</strong> has a well-established reputation for providing<br />

detailed insight from the world’s leading sustainability<br />

thinkers and policymakers.<br />

This 11th edition is no diff erent in off ering readers the latest ideas<br />

and developments in clean technology, environmental protection,<br />

climate finance and innovation that are vital to making the transition to<br />

a low-carbon economy.<br />

Two years ago, 196 member states signed the Paris Agreement,<br />

marking an historic success towards combatting climate change. The accord provides a<br />

major opportunity for countries to develop low-carbon strategies that will build truly modern<br />

and sustainable economies. The landmark deal, along with the newly agreed Sustainable<br />

Development Goals out to 2030, can provide the necessary push for countries to protect the<br />

environment and improve people’s lives.<br />

This year’s climate talks, taking place in Bonn, Germany represent an opportunity to build<br />

on the strength and cooperation which made the Paris Agreement such a success. The role<br />

of cities, regions and the private sector in combatting climate change is crucial to achieving<br />

a two degree scenario. <strong>Climate</strong> <strong>Action</strong> is particularly excited to be continuing our partnership<br />

with BMW Group as Headline Partners for the 8th Sustainable Innovation Forum, which is<br />

the largest business-focused side event taking place at this year’s talks, and is located in the<br />

grounds of Deutsche Post DHL Group’s Post Tower, only steps away from the Bula Zone.<br />

In this edition, we are delighted to include participation from a range of countries and<br />

bodies including Fiji, the African Union, France, UK, Denmark, Norway, Canada, and the<br />

European Commission.<br />

We hope you find the latest edition of <strong>Climate</strong> <strong>Action</strong> informative and engaging.<br />

Nick Henry,<br />

Founder & Chief Executive Off icer, <strong>Climate</strong> <strong>Action</strong><br />

The information contained in this publication has been published in good faith and the opinions herein<br />

are those of the authors and of the UN Environment or <strong>Climate</strong> <strong>Action</strong>. The designations employed and<br />

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concerning proprietary products for publicity or advertising is not permitted. Reproduction in whole or<br />

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strictly prohibited. Volume copyright <strong>Climate</strong> Change Media Limited unless otherwise stated.<br />

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4 Erik Solheim, Executive<br />

Director, UN Environment<br />

8 Frank Bainimarama,<br />

Prime Minister of Fiji and<br />

President of COP23<br />

10 Barbara Hendricks,<br />

Minister for the Environment,<br />

Germany<br />

14 <strong>Climate</strong> <strong>Action</strong>’s 15 <strong>Climate</strong><br />

Champions of <strong>2017</strong><br />

10<br />

32 High ambitions for France’s<br />

climate transition<br />

Nicolas Hulot, Minister for<br />

Ecological and Solidary Transition,<br />

France<br />

34 Electrifying Norway<br />

Vidar Helgesen, Minister of <strong>Climate</strong><br />

and Environment, Norway<br />

36 The Danish way to green<br />

growth<br />

Lars Christian Lilleholt, Minister<br />

of Energy, Utilities and <strong>Climate</strong>,<br />

Denmark<br />

COP23 & BEYOND<br />

18 Sharpening climate action<br />

at COP23<br />

Patricia Espinosa, UNFCCC<br />

20 COP23: bringing<br />

Paris to life<br />

Nazhat Shameem Khan,<br />

Chief Negotiator for the COP23<br />

Presidency, Fiji<br />

23 Looking forward<br />

to COP24<br />

Jan Szyszko, Minister for the<br />

Environment, Poland<br />

POLICY<br />

26 Impact of U.S. withdrawal on<br />

the Paris Agreement<br />

Sue Biniaz, UN Foundation<br />

28 America pledges to fight<br />

climate change, with or<br />

without Washington<br />

Michael Bloomberg, UN Special<br />

Envoy for Cities and <strong>Climate</strong><br />

Change<br />

20<br />

30<br />

40 Finland leads the transition<br />

towards a circular bio-economy<br />

Kimmo Tiilikainen, Minister of the<br />

Environment, Energy and Housing,<br />

Finland<br />

42 A low carbon future<br />

for the UK<br />

Claire Perry, Minister for <strong>Climate</strong><br />

Change and Industry, UK<br />

44 Clean growth and climate<br />

action in Canada<br />

Catherine McKenna,<br />

Minister of Environment and<br />

<strong>Climate</strong> Change, Canada<br />

46 Women must be at the heart<br />

of climate action<br />

Isabella Lövin, Minister for<br />

International Development<br />

Cooperation and <strong>Climate</strong>, Sweden<br />

48 Disaster risk reduction and<br />

climate change<br />

Robert Glasser, UN Special<br />

Representative for Disaster Risk<br />

Reduction<br />


30 Europe leads by example on<br />

climate action<br />

Jos Delbeke, Directorate-<br />

General for <strong>Climate</strong> <strong>Action</strong>,<br />

European Commission<br />

32<br />

52 <strong>Climate</strong> <strong>Action</strong>’s Sustainable<br />

Investment Forum<br />

54 Financing climate impacts in<br />

small island states<br />

Thoriq Ibrahim, Minister of<br />

Environment and Energy, Maldives<br />


56 $70 trillion global investment<br />

pool goes greener<br />

Andrew Steer, World Resources<br />

Institute<br />

58 Sustainable finance: the great<br />

acceleration<br />

Nick Robins, UN Environment<br />

Inquiry<br />

60 The importance of climaterelated<br />

financial disclosures<br />

Graeme Pitkethly, Task Force<br />

on <strong>Climate</strong>-related Financial<br />

Disclosures<br />

56<br />

ENERGY<br />

79 Decarbonising the energy<br />

sector<br />

Interview with Christoph Frei,<br />

World Energy Council<br />

84 Integrating renewables into<br />

our energy systems<br />

Christine Lins, REN21<br />

88 Africa’s renewable energy:<br />

challenges and opportunities<br />

Amani Abou-Zeid, African Union<br />

Commission<br />


62 <strong>Climate</strong> transparency in<br />

financial markets<br />

Remco Fischer, UNEP FI<br />

92 Are India’s renewable energy<br />

targets over ambitious?<br />

Leena Srivastava, TERI University<br />

64 Carbon pricing in the Paris<br />

Agreement era<br />

Richard Zechter, World Bank Group<br />


66 <strong>Climate</strong> <strong>Action</strong>’s Sustainable<br />

Innovation Forum<br />

68 Mission Innovation:<br />

accelerating the transition to<br />

a clean energy economy<br />

Patrick Child, European<br />

Commission<br />

71 Catalysing climate innovation<br />

in developing countries<br />

Anabel Gonzalez & Jonathan<br />

Coony, World Bank Group<br />

74 Innovative technologies<br />

provide the answer to climate<br />

change<br />

Roland Busch, Siemens AG<br />

76 1000 profitable solutions to<br />

solve climate change<br />

Bertrand Piccard, Solar Impulse<br />

Foundation<br />

79<br />

84<br />

109<br />

95 Catalysing affordable, reliable<br />

and efficient energy in the U.S.<br />

Daniel Simmons, U.S. Department<br />

of Energy<br />


98 Decarbonising shipping –<br />

a challenge for all<br />

Kitack Lim, International Maritime<br />

Organization<br />

101 Accelerating the transition to<br />

electric vehicles<br />

Colin McKerracher, Bloomberg<br />

New Energy Finance<br />

104 A continued commitment to<br />

green innovation<br />

BMW Group<br />

CITIES<br />

106 Resilient cities: good for the<br />

climate and good for business<br />

Gino Van Begin, ICLEI – Local<br />

Governments for Sustainability<br />

109 Delivering concrete climate<br />

action in cities<br />

Mark Watts, C40 Cities<br />




Erik Solheim<br />

UN Environment Executive Director<br />

and Under-Secretary-General of the<br />

United Nations<br />

The Paris Agreement on <strong>Climate</strong><br />

Change is a clear sign that nations<br />

can put their differences to one side<br />

and work together for the future benefit<br />

of people and planet. However, it is clear<br />

we need to do more and we need to do it<br />

faster; much faster. This edition of <strong>Climate</strong><br />

<strong>Action</strong> shares thoughts from governments,<br />

businesses and academics on policies that<br />

can help make that happen, notably through<br />

the transition to a global green economy.<br />

Around the world, the media is full of<br />

headlines and dramatic images of extreme<br />

weather events, which are becoming<br />

more frequent and more serious. It’s<br />

a reminder that climate change is not<br />

something that will happen in the future; it<br />

is happening now. The human, economic<br />

and environmental cost is mounting fast.<br />

But another, closely connected tragedy<br />

is very quietly and steadily unfolding in<br />

the background, costing millions of lives<br />

and trillions of dollars. The same dirty<br />

transport, energy, refrigeration and waste<br />

that are pumping out greenhouse gas<br />

emissions around the planet, are pumping<br />

out pollution around its people.<br />

Take air pollution, which kills up to<br />

seven million people a year. In India, it<br />

is causing a significant rise in strokes,<br />

with women who breathe smoke from<br />

household cooking facing a 40 per cent<br />

higher risk. And, while strokes used to<br />

be considered a disease for the elderly,<br />

doctors like Praveen Gupta have seen<br />

the number of young stroke patients<br />


The world is responding in a<br />

myriad of ways that offer real hope<br />

and tangible solutions.<br />


almost double in recent years. In fact,<br />

many stroke patients are only in their<br />

thirties and forties.<br />

In the face of such a challenge it is easy<br />

to be fatalistic, but the world is responding<br />

in a myriad of ways that offer real hope<br />

and tangible solutions. Countries, cities<br />

and citizens are taking action to support<br />

UN Environment’s BreatheLife, CleanSeas<br />

and BeatPollution campaigns. Government<br />

policies and the private sector are driving<br />

down the price of green technology like<br />

renewable energy, which now attracts<br />

investments of $300 billion a year and<br />

employs over 8 million people. The<br />

diversity of the solutions on offer is evident<br />

in the range of articles in this edition of<br />

<strong>Climate</strong> <strong>Action</strong>. From climate lawyer Sue<br />

Biniaz at the UN Foundation to Michael<br />

Bloomberg, the authors reflect the many<br />

voices rallying to mobilise green capital<br />

and prevent runaway climate change.<br />

Whether it’s the dramatic face of<br />

disaster that we see in the headlines or the<br />

very human face of suffering that Doctor<br />

Gupta sees every day in the hospital, there<br />

is no doubt that this must change. If the<br />

UN <strong>Climate</strong> Change conference in Bonn<br />

provides the perfect platform to agree the<br />

priorities for action, then the articles in<br />

<strong>Climate</strong> <strong>Action</strong> provide a timely reminder<br />

that we can and will deliver. I hope, that for<br />

public and private sector decision makers<br />

alike, it will provide new inspiration and<br />

build an even better future for this planet<br />

and its people.<br />







200 KM.<br />

Sheer<br />

Driving Pleasure





TO COP23<br />

Frank Bainimarama, Prime Minister<br />

of Fiji and President of COP23<br />

Fiji is proud to preside over COP23<br />

and, particularly, to count the<br />

Federal Republic of Germany, the<br />

State of North Rhine-Westphalia and<br />

the City of Bonn as our partners. When<br />

several friendly nations suggested at<br />

COP22 in Morocco that Fiji take on the<br />

Presidency of COP23, we found the idea<br />

both daunting and enticing. Daunting<br />

because it is a huge undertaking for a<br />

small country, and enticing because it<br />

gives us a chance to carry forward the<br />

perspective of all climate-vulnerable<br />

countries.<br />

Fiji is not a newcomer to the world<br />

stage. We may seem like a small, isolated<br />

country in the middle of the Pacific<br />

Ocean, nearly 5,000 kilometres from<br />

the nearest continent, but we are an<br />

outward-looking nation and have long<br />

had an internationalist perspective.<br />

Trade is important to us, our Pacific<br />

neighbourhood is important to us, and<br />

we welcome thousands of visitors to our<br />

shores each year. We also take seriously<br />

our role as a responsible member of the<br />

world community, and so we are among<br />

the world’s foremost contributors to<br />

United Nations peacekeeping operations.<br />

Now we have the chance - with the<br />

rest of the world - to rescue ourselves<br />

from the folly we have lived since the<br />

dawn of the industrial era. We can take<br />

concerted action to reduce greenhouse<br />

gases and limit global temperature rise<br />

to 1.5°C above pre-industrial levels. For<br />



Now we have the chance - with the<br />

rest of the world - to rescue ourselves<br />

from the folly we have lived since the<br />

dawn of the industrial era.<br />

Fiji and other vulnerable and developing<br />

states, this is not just an ambitious<br />

goal. It is an imperative and a minimum<br />

achievement. Of course, it is no less<br />

important to developed countries and<br />

countries with large land areas, so<br />

we are pleased to see that virtually all<br />

nations are trying to put aside narrow<br />

interests to achieve a common good. We<br />

are engaged together in a noble effort,<br />

which will require constant effort and<br />

recommitment. We must succeed.<br />



COP23 IN BONN:<br />




Copyright-Hinweis: BMUB/Susie Knoll Farbraum<br />

Dr Barbara Hendricks, Federal<br />

Minister for the Environment, Nature<br />

Conservation, Building and Nuclear<br />

Safety, Germany<br />

The recent months have dramatically<br />

shown that the impacts of climate<br />

change can no longer be ignored.<br />

As the world warms up, tropical cyclones,<br />

for example, including the devastating<br />

Atlantic hurricanes we have witnessed this<br />

year, will probably get more intense and<br />

more common in coming decades. Here<br />

in Germany, too, the number of extreme<br />

weather events has more than tripled since<br />

the 1970s.<br />

Against this background, I am very<br />

glad that with Fiji, for the first time a Small<br />

Island Developing State has taken on the<br />

important role of the COP presidency.<br />

As a country particularly aff ected by the<br />

impacts of climate change, important<br />

topics such as adaptation to the impacts<br />

of climate change and resilience against<br />

climate change will be given a prominent<br />

role this year in Bonn.<br />

It is clear that we have to act now and<br />

rapidly to achieve the temperature goals<br />

set out in the Paris Agreement – to keep<br />

global warming to well below 2˚C, and<br />

to strive for 1.5˚C.<br />

Important steps on the road to this<br />

goal will be negotiated in Bonn. We will<br />

need to work on further elaborating the<br />

details regarding the implementation<br />

of the Paris Agreement, which will<br />

allow for the implementation guidelines<br />

to be adopted at COP24 next year in<br />

Poland, and to lay the groundwork for<br />

more ambitious climate action in the<br />

Facilitative Dialogue.<br />

While we negotiate these important<br />

aspects in Bonn, the transformation<br />

to a greenhouse-neutral and climate<br />

resilient world is well under way. These<br />

irreversible developments will be<br />

reflected in the COP’s new concept of<br />



As technical<br />

host we are<br />

delighted to<br />

support the Fiji<br />

presidency and<br />

the UN <strong>Climate</strong><br />

Change Secretariat<br />

in the planning and<br />

organisation of this<br />

conference.<br />

‘one conference – two zones’. One zone<br />

– the ‘BULA’ zone – will be dedicated to<br />

the negotiations, whereas the other – the<br />

BONN zone – will focus on action and<br />

implementation. The approach focuses<br />

on a close integration of the zones. We<br />

want to make sure that showcasing<br />

decisive climate action and concrete<br />

solutions for implementing the Paris<br />

Agreement will push the negotiations<br />

forward.<br />

Germany will also do its part: As<br />

technical host we are delighted to<br />

support the Fiji presidency and the<br />

UN <strong>Climate</strong> Change Secretariat in<br />

the planning and organisation of<br />

this conference. We will also present<br />

our national climate efforts: firstly,<br />

on how we implement the <strong>Climate</strong><br />

<strong>Action</strong> Plan 2050 the German cabinet<br />

adopted in November 2016. The goal<br />

of this long-term strategy is largely to<br />

achieve greenhouse gas neutrality in<br />

Germany by 2050. It contains climate<br />

targets for individual sectors, providing<br />

guidance for strategic decisions in the<br />

years ahead. Secondly, the German<br />

government has also launched<br />

further initiatives at international<br />

level to encourage the reduction of<br />

CO 2<br />

emissions and adaptation to the<br />

impacts of climate change. Germany’s<br />

contribution has significantly increased<br />

and its commitments have grown more<br />

than fivefold since 2005.<br />

Our goal is to make the most of the<br />

momentum of the Paris Agreement in<br />

cooperation with our partners from all<br />

over the world. We know that we will<br />

only succeed by working together for<br />

solutions. I am therefore looking forward<br />

to welcoming all of you in Bonn.<br />



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ACTION’S<br />

15 CLIMATE<br />


OF <strong>2017</strong><br />

<strong>Climate</strong> <strong>Action</strong> has<br />

selected 15 <strong>Climate</strong><br />

Champions that are leading<br />

the way towards innovative<br />

and scalable solutions to<br />

climate change. In this new<br />

feature, we are delighted to<br />

shine a spotlight on these<br />

governments, individuals,<br />

organisations, companies<br />

and cities - and hope<br />

that their dedication and<br />

passion for climate action<br />

will inspire others to follow.<br />


Frank Bainimarama<br />

The Fijian Prime Minister is making access to climate finance a “key pillar” of his country’s presidency<br />

of COP23. He recently announced that Fiji would become the first emerging country to issue a<br />

sovereign green bond, raising $50m. This will directly support projects to make the island more<br />

resilient to the impacts of climate change, and build new renewable energy plants. Ahead of Bonn,<br />

Prime Minister Bainimarama has also called for “absolute dedication to meet the 1.5 degree target”,<br />

commenting that “it’s hard to find any part of the world that is unaffected” by climate change.<br />


Cape Town<br />

In recent years, Cape Town has experienced a number of increased droughts, floods and wildfires.<br />

The city has responded to these threats by aiming to improve its resilience to climate change. It<br />

has created a specific climate adaption plan, which includes policies to manage urban water more<br />

efficiently, reduce emissions through waste management at landfill sites, and source up to 20 per<br />

cent of the city’s power from renewables. The city is also active in supporting clean technology<br />

industries and initiatives.<br />

Jerry Brown<br />

The American politician and current Governor of California was designated the Special Envoy for States<br />

and Regions for this year’s climate change conference by the Fijian Prime Minister. He has passionately<br />

supported regional action, including co-leading the response to the US withdrawal by co-creating<br />

‘America’s Pledge’. This commitment helps bring together the thousands of business leaders, mayors,<br />

cities, and states which have affirmed their commitment to the Paris Agreement. Governor Brown has<br />

been a tireless and active voice for sustainability, recently announcing that California would host a<br />

‘<strong>Climate</strong> <strong>Action</strong> Summit’ in <strong>2018</strong>. He also went on a tour of China to promote clean energy, and signed<br />

with President Xi an agreement to work together to reduce carbon emissions.<br />

Pacific Islands<br />

Each year, an increasing number of low-lying islands are lost to rising sea levels. The Pacific Islands<br />

have consistently presented a united front in the face of this imminent threat, caused by climate<br />

change. Fiji has made it clear that its presidency of COP23 will stress for the strongest and most<br />

inclusive set of actions. The United Nations General Assembly in September also saw a succession<br />

of speeches from island leaders urging the international community to act quickly. Seven national<br />

leaders, including the Republic of Kiribati, Tonga, and the Solomon Islands repeated calls for “urgent<br />

and collective action”.<br />

France<br />

The election of Emmanuel Macron as President of France has helped reinvigorate French<br />

commitments to climate change. In response to the US withdrawal from the Paris Agreement,<br />

President Macron launched an initiative offering American scientists the opportunity to apply for<br />

grants to continue their climate research in France. The new environment minister, the long-term<br />

activist Nicolas Hulot, also announced the country’s intention to outlaw the sale of all petrol and<br />

diesel cars by 2040. Mr. Hulot, who writes in this edition of <strong>Climate</strong> <strong>Action</strong>, also stated that France<br />

will end the use of coal-fired power plants by 2022. France is showing new levels of ambition when it<br />

comes to the environment with longer-term plans to make the entire country carbon neutral by 2050.<br />



Sweden<br />

Sweden has just committed to completely phasing out greenhouse gas emissions by 2045. The goal<br />

will require the government to cut greenhouse gas emissions by at least 85 per cent and the remainder<br />

will be offset by planting trees or sustainable investments abroad. Environment Minister and Deputy<br />

Prime Minister Isabella Lövin, who writes on gender in this edition of <strong>Climate</strong> <strong>Action</strong>, signed the law in<br />

February. She said: “We see that the advantages of a climate-smart society are huge, both when it comes<br />

to health, job creation and also security”. The Scandinavian country has continued to show strong climate<br />

leadership, and has already met its 2020 target to source 50 per cent of its electricity from renewables.<br />

António Guterres<br />

The new UN Secretary-General has shown strong climate leadership during a testing first year in<br />

office. He has drawn particular attention to how climate change increases the threat of conflict,<br />

poverty and displacement. Within two weeks of taking office he urged his organisation to prioritise<br />

resources to prevent internal conflicts, stating: “The cost of inaction is simply too high”. He was also<br />

clear in connecting the recent number of catastrophic hurricanes to global warming, telling the UN<br />

General Assembly: “The season fits a pattern. Changes to our climate are making extreme weather<br />

events more severe and frequent”.<br />

ICLEI<br />

ICLEI is a network of over 1,500 cities, towns and regions working on new ways to green our urban<br />

economies, areas and infrastructure. It has been instrumental in bringing together the Compact<br />

of Mayors to provide tangible commitments from cities to accelerate climate action and reduce<br />

emissions. ICLEI is also driving forward the role of cities and regions in developing the concept of<br />

Local and Regionally Determined Contributions in meeting the goals of the Paris Agreement. Gino<br />

Van Begin, who writes in this edition on climate resilience, has said: “The world is looking for a signal<br />

that nations are moving climate action forward. Local and regional governments will be at COP23,<br />

ready to send that signal”.<br />

Bloomberg Philanthropies<br />

Michael Bloomberg’s charitable foundation had an active year supporting action against climate<br />

change. The foundation was one of the early investors in a new climate fund initiated by Bill Gates.<br />

Breakthrough Energy Ventures is dedicated to investing in affordable and reliable zero-carbon<br />

technologies. Bloomberg also helped launch the America’s Pledge initiative to maintain support for<br />

the Paris Agreement, and recently donated $64 million to a campaign to shut down coal plants in the<br />

United States. Michael Bloomberg writes in this edition on the role of cities and regions in the fight<br />

against climate change.<br />

Angela Merkel<br />

Angela Merkel reaffirmed her credentials as the ‘<strong>Climate</strong> Chancellor’ this year by ensuring the lowcarbon<br />

transition remained high on the global agenda. As Germany played host to this year’s G20<br />

summit in Hamburg, Mrs Merkel successfully made climate change one of the main items of the twoday<br />

meeting. An action plan was agreed at the end of the talks to further clean energy growth and<br />

emissions reduction. The final communique also made clear that “the Paris Agreement is irreversible”<br />

and “we reaffirm our strong commitment to the Paris Agreement”. The Chancellor has been a longterm<br />

supporter of emissions cuts and before being re-elected in September, she promised voters that<br />

Germany would reach its ambitious 2020 climate targets.<br />


London<br />

A year since Sadiq Khan was elected, the new Mayor of London has put clean air and sustainability<br />

at the centre of his plans for the city. A new toxicity charge was recently introduced to limit the oldest<br />

and most polluting vehicles from entering central London. This initial measure will be bolstered by<br />

a new Ultra-Low Emission Zone to ensure all vehicles meet air quality standards. Mr. Khan is also<br />

phasing out diesel buses, and has pledged to buy only zero-emission buses from 2025. He has said: “I<br />

want to make London one of the greenest cities in the world”.<br />


Barcelona<br />

As a coastal Mediterranean city, Barcelona is vulnerable to the impacts of climate change and it has<br />

recognised that it needs to adapt. Its Mayor, Ada Colau, has put green infrastructure the centrepiece<br />

of a 20 year plan for the city, aiming to add 408 acres of new green space, extend bicycle lanes<br />

and cut private vehicle usage. The city already manages 310,000 trees and plans to greatly increase<br />

this number to encourage biodiversity, temper the microclimate and reduce the impacts from local<br />

flooding.<br />

Hakima El Haite<br />

Hakima El Haite is a Moroccan politician, climate scientist and passionate advocate for change.<br />

She is the Special Envoy of the Kingdom of Morocco and was also named by the UN as a High<br />

Level Champion for <strong>Climate</strong> <strong>Action</strong>. At COP22, she helped launch the Marrakech Partnership for<br />

Global <strong>Climate</strong> <strong>Action</strong>, which is designed to accelerate the goals of the Paris Agreement. She has<br />

played an instrumental role over the past year in bringing together different parties to advance<br />

action on climate change.<br />

Mark Carney<br />

The Governor of the Bank of England has been central in promoting the role of finance in responding<br />

to the impacts of climate change. He was instrumental in the creation of the Task Force on <strong>Climate</strong>related<br />

Financial Disclosures. The body develops robust and consistent data on the level of risk posed<br />

by climate change on financial assets. This means that market participants and policymakers can<br />

better understand and respond to these threats. Mr. Carney has led the way in promoting marketbased<br />

solutions to climate change and sought to raise the profile, and viability, of green finance.<br />

The BMW Group<br />

The BMW Group is successfully integrating sustainable thinking into the way it does business. It<br />

already sources 50 per cent of its electricity from renewables and is on course to reach its target<br />

of 100 per cent by 2020. It has also focussed on decreasing the amount of energy needed in car<br />

production, reducing consumption by over 35 per cent in 10 years. In the past year, the company has<br />

also announced a software update to help cut pollution levels by nearly a third, and introduced a<br />

scheme where older cars can be upgraded for a low-emissions vehicle.<br />


COP23 & BEYOND<br />



AT COP23<br />

Patricia Espinosa, Executive<br />

Secretary, UN Framework Convention<br />

on <strong>Climate</strong> Change (UNFCCC)<br />

The Paris vision demands<br />

that we rethink together the<br />

way we produce, use and<br />

consume energy, how we<br />

manufacture and build, how<br />

we manage our land and<br />

ecosystems.<br />


Hurricanes Harvey, Irma and Maria<br />

were just the latest stark warning<br />

that the world must cut out the<br />

greenhouse gas emissions that increase<br />

extreme weather, and build societies that<br />

can resist or recover quickly from the<br />

climate change that is already upon us.<br />

These three hurricanes in the Caribbean–<br />

US region have caused misery and hit<br />

the livelihoods of hundreds of thousands,<br />

while causing losses estimated upwards of<br />

US$350 billion – equal to the annual gross<br />

domestic product of a country like Egypt,<br />

Norway or Thailand.<br />

In South Asia alone, flooding this year<br />

has so far killed over 1,200 people, and<br />

triggered economic losses to countries<br />

and communities. That is why COP23<br />

will take the next essential steps to<br />

ensure that the Paris <strong>Climate</strong> Change<br />

Agreement meets its central goal: to<br />

prevent global temperatures rising beyond<br />

the point where human civilisation will<br />

be unable to cope with the impacts. The<br />

Agreement seeks to keep the average<br />

global temperature rise since the late 19th<br />

century well below 2˚C and as close to<br />

1.5˚C as possible. We have seen around<br />

one degree Celsius of this rise already,<br />

underlining the imperative to deliver<br />

results right now.<br />

Emissions need to peak fast and be<br />

dramatically cut thereafter until, as soon<br />

after 2050 as possible, they are so low<br />

they can be safely absorbed by natural<br />

systems like forests and soils or removed<br />

by available technology.<br />

The Agreement, coupled with the global<br />

Sustainable Development Goals under the<br />

UN, is a new, optimistic vision of the future<br />

where stable, secure livelihoods remain<br />

possible. The Paris vision demands that<br />

we rethink together the way we produce,<br />

use and consume energy, how we<br />

manufacture and build, how we manage<br />

our land and ecosystems.<br />

COP23, in Bonn, Germany, therefore<br />

has three main objectives. It will show<br />

how rising numbers of governments,<br />

cities, states, businesses, civil society<br />

and multilateral organisations are taking<br />

ambitious climate action and how new<br />

actors are continually coming on board.<br />

It must move further and faster now<br />

on how all these actors cooperate and<br />

coordinate together to make a much<br />

bigger united impact; especially in<br />

financing action. COP23 must make<br />

progress so that in <strong>2018</strong> governments<br />

complete the full set of operational ways<br />

and means under the Paris Agreement to<br />

help government and non-government<br />

actors alike meet the agreed goals to the<br />

best of their ability.<br />

Great advances continue to be made,<br />

showing the Paris Agreement is not a<br />

chain, broken by any weak political or<br />

economic link, but an ever deepening and<br />

widening web of influence and agreement.<br />

These are only a few of many, many<br />

examples:<br />

• China announces five pilot zones<br />

for ‘green finance’, where financial<br />

institutions will provide incentives to<br />

fast track green industries and new<br />

financing methods.<br />

• Several countries, including France<br />

and the U.K., announce dates when<br />

fossil fuel cars will be gone, replaced by<br />

electric vehicles.<br />

• Over 100 multinational companies<br />

pledge to source 100 per cent<br />

renewable energy for their operations<br />

under an initiative called RE100 by The<br />

<strong>Climate</strong> Group.<br />

• Over 250 US mayors commit to procure<br />

100 per cent renewable energy for their<br />

cities by 2035.<br />

• Moody’s reports green bond issuance<br />

worldwide could cross US$200 billion in<br />

<strong>2017</strong>, doubling the 2016 record.<br />

Sectors previously seen as latecomers<br />

to climate action are also moving. For<br />

example:<br />

• In cement (around 5-6 per cent of<br />

global emissions), HeidelbergCement in<br />

Germany and India’s Dalmia Cement are<br />

committed to reducing their greenhouse<br />

gas emissions.<br />

• In iron and steel (around 4 per cent),<br />

Sweden’s Vattenfall aims to use<br />

hydrogen instead of coal to become the<br />

first manufacturer of steel with almost<br />

no carbon dioxide.<br />

Meanwhile, much better coordination<br />

of climate action is now required among<br />

governments, cities, states, business<br />

and multilateral development banks and<br />

institutions. A country, company or citizen<br />

needs the most relevant, simple and timely<br />

channels to seize the major opportunities<br />

available in cutting emissions and<br />

protecting themselves against climate<br />

impacts and to access easily the<br />

technology and finance to do it.<br />

Insurance off ers a good example where<br />

uncoordinated action will never work<br />

because total risk must be dispersed<br />

among all. The poorest with no insurance<br />

suff er the worst. At COP23, we look<br />

forward to seeing how even greater<br />

coordination between governments and<br />

the insurance industry can increase the<br />

impact of the G7 InsuResilience plan to<br />

extend insurance to an additional 400<br />

million poor people worldwide.<br />

The third COP23 key objective is for<br />

governments to advance work on the full<br />

operating system of the Paris Agreement so<br />

that it is completed at COP24, in <strong>2018</strong>. The<br />

need for such a system reflects the uniquely<br />

practical nature of the Paris Agreement –<br />

the only multilateral agreement backed with<br />

a set of concrete national plans to reduce<br />

emissions and build properly sustainable<br />

societies and economies.<br />

If that is all there was – a set of diverse<br />

promises to act on climate change – it<br />

would be impossible to assess whether<br />

the world was on track to meet the<br />

Agreement’s goals. The objective,<br />

therefore, is to deliver a comprehensive<br />

operating system to encourage, guide<br />

and report national and international<br />

climate action – to act further, faster,<br />

together – and to make a regular reality<br />

check in the coming decades on whether<br />

we are on track.<br />

This year’s COP23 is itself a welcome<br />

mirror of cooperation and coordination.<br />

The conference is organised by Bonnbased<br />

UN <strong>Climate</strong> Change, is presided<br />

over by the small, developing Pacific<br />

island state of Fiji as President, and is<br />

organisationally and logistically supported<br />

by G7 member Germany, with further<br />

support from the German state of North-<br />

Rhine-Westphalia and the City of Bonn.<br />

A central goal for the Fijian Presidency<br />

of COP23 is to forge this essential ‘Grand<br />

Coalition’ to accelerate climate action<br />

before 2020 and beyond.<br />

Further, faster, together in Bonn.<br />

COP23 & BEYOND<br />


COP23 & BEYOND<br />

COP23:<br />



We bring an urgency<br />

to the process based on our<br />

experience and perspective<br />

as a small island country.<br />

Tropical cyclone Winston leaves a trail of destruction in Fiji last year<br />


H E Nazhat Shameem Khan,<br />

Chief Negotiator for the COP23<br />

Presidency, Fiji<br />

We meet at COP23 in Bonn with<br />

the global community at a<br />

crossroads in our collective<br />

response to climate change. The choices<br />

we make now will decide the fate of our<br />

planet and have a huge impact on the lives<br />

of all 7.5 billion people on earth. So it is vital<br />

that every global citizen is aware of what is<br />

at stake and what needs to be done.<br />

Fiji has assumed the role of the COP23<br />

presidency as the first Pacific Small Island<br />

Developing State to be given charge of<br />

the ongoing UN climate negotiations. I<br />

am often asked if this means COP23 will<br />

be a Pacific COP. My answer is this: while<br />

Fiji will preside over the negotiations on<br />

behalf of all countries, from all corners of<br />

globe, there is absolutely no doubt that we<br />

bring an urgency to the process based on<br />

our experience and perspective as a small<br />

island country. In doing so, we will give<br />

voice to the concerns and aspirations of<br />

one of the most climate vulnerable regions<br />

on earth.<br />

For us, the urgency is clear. In Fiji’s case,<br />

a tropical cyclone last year killed 44 of our<br />

loved ones, left many thousands of our<br />

people homeless and destroyed one-third<br />

of our GDP. Our neighbours in Vanuatu<br />

suff ered a similar disaster in 2015. And<br />

those of us living in vulnerable nations<br />

know the worst is yet to come. Indeed,<br />

three of our neighbours – Kiribati, Tuvalu<br />

and the Marshall Islands – face being<br />

submerged by the rising seas altogether.<br />

The stakes could not be higher.<br />

The Paris Agreement commits us to<br />

keeping the average global temperature<br />

well below two degrees over the industrial<br />

age and pursue eff orts to limit it to 1.5°C.<br />

COP23 & BEYOND<br />


COP23 & BEYOND<br />

Our game plan is<br />

this: To keep the global<br />

climate negotiations on<br />

track. To get everyone to<br />

fully implement the Paris<br />

Agreement and limit the<br />

global temperature to 1.5°C<br />

above that of the industrial<br />

age. And to get there, we<br />

will be reminding everyone<br />

of a very simple fact. We<br />

will only get there with<br />

teamwork. Every nation<br />

committing itself to climate<br />

action in the way that Fiji<br />

has. The citizens of the<br />

world coming together as<br />

one world – Team World –<br />

and doing what we must do<br />

to save our precious planet<br />

from the ravages of climate<br />

change.<br />

Frank Bainimarama, Prime Minister<br />

of Fiji and President of COP23<br />

The diplomacy and dialogue that led to<br />

this Agreement was one of the great feats<br />

of our age. But now it’s time to accelerate<br />

the pace and raise the ambition, because<br />

the evidence shows that we have no time<br />

to waste. Now it’s time for the hard work<br />

– to put words into action to bring Paris<br />

to life; otherwise the Agreement is just a<br />

piece of paper.<br />

It is no mystery that there have<br />

been significant shifts in the political<br />

environment since Fiji first assumed the<br />

role of the incoming Presidency last year.<br />

While we were of course disappointed by<br />

the decision of the Trump Administration,<br />

it is clear that the overall global desire to<br />

keep up the momentum and move forward<br />

with even greater ambition is unshakeable.<br />

In fact, we have been extremely<br />

encouraged by our consultations over the<br />

course of the year –with both parties and<br />

non-state actors – and have received very<br />

clear feedback on their desire for COP23<br />

to be a visionary COP. By this I mean<br />

a COP where outcomes are measured<br />

against their capacity to achieve the<br />

vision of the Paris Agreement: the vision<br />

of limiting global warming to 1.5°C,<br />

which is now the target for the world.<br />

Fiji is committed to this goal and we are<br />

determined to make progress at COP23<br />

that is balanced and shows a resolve<br />

Now it’s time to accelerate the<br />

pace and raise the ambition, because<br />

the evidence shows that we have no<br />

time to waste.<br />

that next year the negotiations are going<br />

to result in a set of guidelines that make<br />

Paris operational.<br />

To achieve this, we will rely on the Fijian<br />

concept of talanoa. This is a process of<br />

inclusive, participatory and transparent<br />

dialogue that builds empathy and leads<br />

to decision-making for the collective<br />

good. This concept is about listening to<br />

each other, learning from each other, and<br />

sharing stories, skills and experiences. We<br />

hope that by focusing on the benefits of<br />

action, we will be able to move the global<br />

climate agenda forward.<br />

As a symbol of our Presidency, we will<br />

be placing a Fijian ocean-going canoe<br />

– a drua – in the main foyer in Bonn. It<br />

is a reminder to the entire world that we<br />

are all in the same canoe when it comes<br />

to climate change. No-one is immune<br />

to its impact. And in the forthcoming<br />

negotiations, we must fill the sail of that<br />

canoe with a collective determination to<br />

move the climate action agenda forward.<br />

I appeal to every global citizen to join me<br />

on this journey for the sake of all humanity<br />

now and the generations to come.<br />



COP23 & BEYOND<br />


TO COP24<br />

Jan Szyszko,<br />

Minister for the<br />

Environment,<br />

Poland<br />

Planet Earth is the only home<br />

for human beings and we have<br />

to preserve it so that future<br />

generations can live here. In striving to<br />

achieve this, the Paris Agreement is one<br />

of the most important treaties of our time.<br />

Its core objectives and values – collective<br />

responsibility, sovereign contributions<br />

based on national circumstances,<br />

cooperation between all stakeholders –<br />

will lead us to the climate-neutral future<br />

we promised in Paris to current and future<br />

generations. With the necessary support for<br />

developing countries, strong cooperation,<br />

and an integrated and synergistic approach<br />

to other environmental conventions, this<br />

goal is within our reach.<br />

The recent tragic extreme weather<br />

events and the newest scientific reports<br />

prove the relevance of Paris Agreement<br />

goals, including the adaptation goal, and<br />

the urgency of action to achieve them.<br />

As nowadays no nation is fully immune<br />

to climate change impacts, it is in the<br />

interest of all, every community,<br />

to hold the increase of<br />

temperature to well below<br />

2°C compared with preindustrial<br />

levels, and to<br />

adapt our behaviour so<br />

that both human lives<br />


COP23 & BEYOND<br />

Credit: UMK/ A. Wiśniewski<br />

The venue for COP24 in Katowice, Poland<br />


In Katowice the treaty<br />

must become a living framework<br />

delivering its goals.<br />

and economies can be best protected<br />

against these impacts. We must cherish<br />

biodiversity, water and soil resources, which<br />

will continue to provide healthy food, natural<br />

resources and energy for all in the years to<br />

come. A clean and productive environment<br />

is a universal cornerstone of sustainable<br />

development and poverty eradication.<br />

The main and most pressing task ahead<br />

of all parties is the completion of the Paris<br />

Agreement Work Programme not later<br />

than COP24 in Katowice in December<br />

<strong>2018</strong>. It will require significant efforts<br />

of negotiators, supported by non-state<br />

actors, as well as strong political signals<br />

from the highest level. In Paris we adopted<br />

the treaty; a vast majority of countries –<br />

195 parties – have already signed it and<br />

ratified or significantly advanced domestic<br />

processes to do so. In Katowice the<br />

treaty must become a living framework<br />

delivering its goals.<br />

COP23, presided over by Fiji, will be an<br />

essential step towards successfully arriving<br />

at our final destination in Katowice for<br />

COP24. We need the firm leadership of the<br />

Fijian presidency, and good results from<br />

negotiations in all convention bodies. COP23<br />

in Bonn must be a success. This is a precondition<br />

of the success in <strong>2018</strong>. Both Poland<br />

and I personally, as the future President of<br />

COP24, offer our Fijian friends and partners<br />

both political and expert support during the<br />

November conference in Bonn.<br />

<strong>2018</strong> Facilitative Dialogue is another<br />

important event during COP24. The<br />

parties to the Agreement will for the<br />

first time have an opportunity to have<br />

a conversation about their Nationally<br />

Determined Contributions. They will gain<br />

better understanding of the objectives of<br />

other countries as well as understanding<br />

how cooperation may help to achieve<br />

their sovereign goals faster and better.<br />

Universal participation in the dialogue,<br />

and the engagement of countries in<br />

collaborative work, will strengthen a<br />

momentum for future global climate<br />

action, for building both institutional<br />

and human capacity in developing<br />

countries, mobilising climate finance<br />

as well as development and transfer of<br />

technologies. We truly believe that thanks<br />

to the consultations the Presidency of<br />

COP23 has been having in the course of<br />

<strong>2017</strong>, the design of the dialogue will best<br />

reflect the diverse views and expectations<br />

of the parties.<br />

The national sustainable development<br />

policy of Poland aims at balancing social,<br />

environmental and economic aspects,<br />

and includes efforts in many industrial<br />

sectors, including power as well as forestry,<br />

agriculture and municipalities. It is our<br />

primary political goal to ensure energy<br />

security and security of supply, and to avoid<br />

energy poverty. Poland is taking action to<br />

deploy clean coal technologies, to improve<br />

energy efficiency and reduce energy<br />

consumption without impeding the quality of<br />

life. We strive to increase emission removals<br />

by forest ecosystems and soils to help regain<br />

biodiversity and enhance ecosystem services<br />

to the society. District heating systems and<br />

promotion of climate neutral geothermal and<br />

biomass energy, improved insulation of public<br />

and private buildings or better resource<br />

management leading to implementation of<br />

circular economy underpin our continuous<br />

climate oriented endeavours. Our emissions<br />

have already peaked, almost 30 years ago,<br />

and since then continue to fall while the<br />

economy keeps growing. We are ready to<br />

share our experience with all parties now. We<br />

will be doing it during the Polish Presidency<br />

of COP24.<br />

COP23 in Bonn and COP24 in Katowice<br />

will be instrumental to maintaining and<br />

reinvigorating the 2015 political momentum.<br />

For this to happen, we need everybody<br />

on board – those who are already Parties<br />

to the Agreement, as well as other Parties<br />

to UNFCCC. Personally, I am convinced<br />

that climate action is an opportunity for<br />

every nation and the entire world for<br />

peaceful, sustainable development and<br />

improving the life standards of all people.<br />

Therefore, the adoption of Paris Agreement<br />

implementation package will mark the<br />

beginning of the better future for our only<br />

home – the Earth.<br />

The Former Secretary-General of the<br />

United Nations, Ban Ki-moon, said: “There<br />

is no plan B, as we do not have planet<br />

B.” I fully subscribe to this statement and<br />

encourage everybody to do even more,<br />

to make COP23 and COP24 the most<br />

successful COPs for all.<br />

25<br />


POLICY<br />

IMPACT OF U.S.<br />


Sue Biniaz, Senior Fellow at the UN<br />

Foundation, and former Deputy Legal<br />

Adviser and lead climate lawyer at<br />

the U.S. State Department.<br />

26<br />

The Paris Agreement is noteworthy<br />

not only for addressing resilience<br />

but for being designed to be resilient<br />

itself. For environmental, economic and<br />

political reasons, the Agreement needed<br />

to attract broad participation, as well as<br />

maintain it over the long term. It includes<br />

many relevant features that may help<br />

insulate it from U.S. withdrawal.<br />

• Most significantly, the Agreement allows<br />

parties to design their own Nationally<br />

Determined Contributions (NDCs) based<br />

on their respective circumstances.<br />

Contributions are not negotiated with<br />

other countries or derived from a topdown<br />

directive. This approach invited<br />

wide participation at the outset and, in all<br />

likelihood, will help to maintain it.<br />

• Unlike the Kyoto Protocol, which required<br />

further negotiations and ratifications with<br />

respect to subsequent emissions targets,<br />

Paris is self-sustaining. Parties regularly<br />

update their contributions, without the need<br />

for negotiations or ratification processes<br />

that can be cumbersome and cause delays.<br />

• The Agreement will be successful only<br />

if, in the aggregate, ambition marches<br />

onward and upward. Otherwise, its global<br />

temperature goal cannot be realised.<br />

However, it recognises that, along the way,<br />

individual parties may face diff iculties,<br />

whether substantive or political. It therefore<br />

carefully combines provisions of a legally<br />

binding and a hortatory nature, and a Party<br />

need not exit the Agreement if it needs<br />

to change its contribution or if it cannot<br />

increase ambition in its next one.<br />

• While sub-national governments and<br />

other non-State actors cannot formally join<br />

the Agreement, the Paris outcome includes<br />

multiple ways in which they can take on<br />

commitments and otherwise participate in<br />

international climate action.<br />

It is unfortunate that the United States<br />

has expressed its intent to withdraw, despite<br />

the fact that the Agreement accommodated<br />

U.S. concerns, including with the Kyoto<br />

model. The Administration might have<br />

remained in the Agreement and stuck to<br />

the existing U.S. emissions target, even if it<br />

considered that it was unlikely to achieve<br />

it. Alternatively, it might have remained in<br />

the Agreement and adjusted the U.S. target,<br />

in a ‘nationally determined’ manner, to<br />

better reflect the Administration’s climate<br />

and energy policies. While many would<br />

probably have criticised such a move, it<br />

may also have been viewed as the less bad<br />

of two regrettable options.<br />

In any event, the question now is how<br />

resilient the Agreement will be, assuming<br />

U.S. withdrawal in 2020.<br />

• One issue is whether other countries<br />

will withdraw or be deterred from pursuing<br />

their existing NDCs as a result of the U.S.<br />

intent to withdraw. At least so far, this does<br />

not appear to be the case. The nationally<br />

determined nature of contributions may<br />

be one reason why countries continue to<br />

be committed to them – i.e. they designed<br />

their own NDCs irrespective of what<br />

other countries were committing to do.<br />

In addition, to the extent other countries<br />

are taking into account U.S. climate action<br />

in deciding on their own action, they are<br />

likely to look at the explosion in activity and<br />

commitments on the part of U.S. states,<br />

cities, businesses, and other non-federal<br />

actors. The Paris outcome, through various<br />

portals, platforms, and opportunities, has<br />

facilitated the ability of such actors to reflect<br />

the high level of domestic U.S. support for<br />

the Paris Agreement, and climate action<br />

more generally. Such support allows<br />

other countries to judge U.S. ambition in<br />

a manner that goes beyond the policies<br />

solely of the U.S. federal government.<br />

• A second issue is the extent to which<br />

U.S. withdrawal may aff ect other countries’<br />

future action, including their NDCs. Here,



POLICY<br />

it is less clear what the impact of U.S.<br />

withdrawal will be, particularly if the<br />

absence from Paris is prolonged. As noted,<br />

the Agreement’s nationally determined<br />

approach provides parties with flexibility.<br />

Perhaps, again, irrespective of U.S.<br />

withdrawal, countries will focus on robust<br />

U.S. non-State action or determine, on other<br />

grounds, that it is in their interest to remain<br />

in the Agreement and continue taking<br />

ambitious climate action.<br />

• A third issue is what impact U.S.<br />

withdrawal may have on the various<br />

guidelines that the Agreement asks the<br />

CMA to adopt. Here, in the absence<br />

of strong U.S. engagement, special<br />

attention will need to be paid by others<br />

to maintaining the Paris Agreement’s<br />

essential balances regarding, for example,<br />

diff erentiation and bottom-up/top-down<br />

approaches. This will be important not only<br />

for preserving the Agreement’s integrity<br />

but, more specifically, in order to leave open<br />

the option for a future U.S. Administration to<br />

rejoin the Agreement.<br />

• Finally, it goes without saying that<br />

the leadership of the United States,<br />

along with that of many other players,<br />

was essential to securing the Paris<br />

Agreement and wide participation in it.<br />

A pro-Paris U.S. Administration would<br />

probably have devoted substantial<br />

diplomatic energy, as well as resources,<br />

to promoting climate-friendly policies<br />

around the world, including in<br />

developing countries. It is perhaps in<br />

this realm, without such leadership, that<br />

the resilience of the Paris Agreement will<br />

be most severely tested.<br />

In the absence of strong U.S.<br />

engagement, special attention<br />

will need to be paid by others to<br />

maintaining the Paris Agreement’s<br />

essential balances.<br />


POLICY<br />






Michael Bloomberg, UN Special<br />

Envoy for Cities and <strong>Climate</strong> Change<br />

and Co-Chair of America’s Pledge<br />

The United States has recently faced<br />

some of the most devastating<br />

hurricanes in our history, as well<br />

as one of the worst wildfire seasons in<br />

decades. Yet these are far from isolated<br />

incidents. Record floods recently killed<br />

more than a thousand people in India,<br />

Nepal, and Bangladesh. Hundreds were<br />

killed after torrential rains triggered a<br />

mudslide in Sierra Leone. While it is<br />

impossible to attribute any particular<br />

weather event to climate change, the<br />

science is clear: warming air and oceans<br />

are supercharging weather events around<br />

the globe.<br />

The Paris <strong>Climate</strong> Agreement was<br />

a breakthrough in global relations,<br />

and while President Trump has since<br />

announced that the US will pull out of the<br />

agreement in November 2020, the truth<br />

of the matter is that, when it comes to<br />

climate action in America, Washington<br />

will not have the last word. In fact, I am<br />

confident that the US will meet its Paris<br />

commitment – even without leadership<br />

from Congress or the President.<br />

There is good reason to be optimistic<br />

that we will: over the past decade,<br />

the US has led the world in reducing<br />

greenhouse gas emissions – and<br />

Washington had almost nothing<br />

to do with it. Congress passed no<br />

law to reduce emissions, and even<br />

before President Trump was elected,<br />

federal courts had placed on hold<br />

President Obama’s effort to place<br />

stricter emission controls on the<br />

power industry. America’s progress<br />

has been driven almost entirely by<br />

mayors and governors, who adopted<br />

All around the world, cities, regions,<br />

businesses, and citizens are taking a<br />

leading role in fighting climate change.<br />


Credit: Flickr<br />

POLICY<br />

Mike Bloomberg visits Brussels to meet<br />

with the Global Covenant of Mayors<br />

ambitious green agendas; business and<br />

technology leaders, who drove down the<br />

cost of alternative energy (both natural<br />

gas and renewables), invested in energy<br />

efficiency, and committed themselves to<br />

clean energy targets; and consumers,<br />

who led the way in shutting down nearly<br />

half of the US coal-fired power plants.<br />

In the wake of the President’s<br />

announcement last June, each of these<br />

groups came forward to re-affirm its<br />

support for the Paris agreement. Each<br />

recognises that it is in its own best interest<br />

to act, and the President’s decision has<br />

had the event of galvanising each to do<br />

more. To build on that momentum, and<br />

to show the world that Americans are<br />

determined to continue leading on climate<br />

change, California Governor Jerry Brown<br />

and I created America’s Pledge – an<br />

initiative to compile, quantify and track<br />

America’s efforts to dramatically reduce<br />

the nation’s carbon footprint.<br />

With this data, we will create a<br />

comprehensive report that can be<br />

compared to the Nationally Determined<br />

Contributions that every other nation<br />

submitted as part of the Paris Agreement.<br />

These reports will be made available to<br />

the UN and all the parties to the Paris<br />

Agreement – so that the world can still<br />

hold America accountable for meeting<br />

our targets.<br />

But America’s Pledge will do more<br />

than report on our progress. It will also<br />

empower climate leaders to be even<br />

more ambitious, by offering guidance that<br />

can help cities and companies finance<br />

green infrastructure while creating new<br />

jobs. It will also provide ideas on ways<br />

mayors and business leaders can make<br />

their cities more resilient to the climate<br />

impacts we know are coming. And it will<br />

help local officials develop policies that<br />

encourage investment in clean energy.<br />

When it<br />

comes to climate<br />

action in America,<br />

Washington will<br />

not have the last<br />

word.<br />

All around the world, cities, regions,<br />

businesses, and citizens are taking a<br />

leading role in fighting climate change<br />

– and that is as it should be. Cities are<br />

responsible for about 70 per cent of all<br />

greenhouse gas emissions. One of the<br />

best ways that national governments can<br />

fight climate change is to empower cities<br />

with greater authority over their buildings,<br />

energy sources and transport networks –<br />

and to help them access capital that can<br />

be used to finance investments in greener<br />

and cleaner infrastructure.<br />

Local leaders are acting because<br />

reducing emissions is not only good<br />

for the climate; it is also good for our<br />

health. When local governments clean<br />

their air, and when they invest in mass<br />

transit and parks, they make themselves<br />

more attractive places to live. And where<br />

people want to live, businesses want to<br />

invest. The future belongs to cities that<br />

embrace that idea.<br />

Ultimately, winning the war on climate<br />

change requires leadership from all<br />

nations, but it is important to remember<br />

that leadership is not confined to national<br />

capitals. In many countries, including<br />

the US, success will be driven from the<br />

ground up.<br />


POLICY<br />




Jos Delbeke, Director General,<br />

European Commission Directorate-<br />

General for <strong>Climate</strong> <strong>Action</strong><br />

The European Union (EU) has long<br />

demonstrated global leadership<br />

on climate change, one of the<br />

greatest challenges of our time. In<br />

2016, together with countries round the<br />

world, we ratified the Paris Agreement,<br />

allowing its early entry into force. And<br />

yet the road to achieving our common<br />

goals may not always be smooth. Along<br />

with so many of our climate partners<br />

worldwide – nations, regional and local<br />

decision-makers, businesses, civil society<br />

groups and citizens – the EU did not<br />

hide its deep regret at the US President’s<br />

announcement this year to withdraw the<br />

US from the Paris Agreement. However,<br />

the international community has shown<br />

unity and resolve to follow through on<br />

the Paris objectives. The EU has made it<br />

very clear that the world can continue to<br />

count on our leadership and support. We<br />

are stepping up our partnerships around<br />

the world, to help build strong, sustainable<br />

economies and societies that are resilient<br />

to the impacts of climate change.<br />

What is now clear is that the EU is<br />

anything but alone – the global lowcarbon<br />

transition train has already left<br />

the station. Over 85 per cent of the<br />

Paris signatories have now ratified the<br />

The EU did not hide its deep regret<br />

at the US President’s announcement<br />

this year to withdraw the US from the<br />

Paris Agreement.<br />

Agreement and are getting on with<br />

implementation. Like us, they see Paris<br />

not only as a path for preserving the<br />

environment, but also the essential<br />

growth engine for our economies. The<br />

facts keep speaking for themselves: in<br />

2016, investment in renewables capacity<br />

outstripped investment in fossil fuel<br />

generation for the fifth year in a row;<br />

in each of the past three years, global<br />

economic growth was not accompanied<br />

by a rise in greenhouse gas emissions.<br />

This year’s UN climate conference<br />

(COP23) in Bonn, Germany, will be<br />

guided by the presidency of Fiji, the<br />

first small island state to have this role.<br />

We have important progress to make in<br />

Bonn. COP23 and the months that follow<br />

will be crucial for ensuring successful<br />

implementation of the Paris Agreement.<br />

By the end of <strong>2018</strong>, when countries will<br />

gather for COP24 in Katowice, Poland,<br />

parties should adopt a work programme<br />

for Paris and take stock of our collective<br />

contributions to the Agreement, through<br />

the facilitative dialogue.<br />

The EU has arrived at COP23 with an<br />

important message to stakeholders across<br />

Europe and our global partners: we are<br />

getting on with the job at home. To ensure<br />

the EU meets its Paris pledge to reduce<br />

greenhouse gas emissions by at least 40<br />

per cent by 2030 compared with 1990, the<br />

European Commission has put forward a<br />

range of legislative proposals in the past<br />

couple of years, notably to make the EU<br />

emissions trading system (EU ETS) fit for<br />

2030, set member states 2030 emissions<br />

targets for non-ETS sectors and integrate<br />

greenhouse gas emissions and removals<br />

from land use and forestry into the EU’s<br />


climate and energy policy framework.<br />

These files are now being negotiated by the<br />

European Parliament and Council and we<br />

look forward to final agreements, so we can<br />

get legislation in place and therefore lay the<br />

foundations for reaching our 2030 goals.<br />

In Europe, we have a wide range of<br />

policies to drive and enable the shift<br />

towards a low-carbon economy. As part<br />

of our integrated Energy Union, we came<br />

forward late in 2016 with the Clean Energy<br />

for All Europeans package, which will<br />

give a strong push to the clean energy<br />

transition and create jobs and growth.<br />

It will adapt our regulatory framework<br />

to put energy efficiency first and foster<br />

the development of renewable energy.<br />

We have also put forward a proposal on<br />

governance, under which member states<br />

will have to prepare integrated climate and<br />

energy plans, to provide a clear picture<br />

of where we need to go, give investors<br />

certainty and help identify investments<br />

needed for the clean energy transition.<br />

We are also working to transform<br />

mobility in Europe and put the EU transport<br />

sector firmly on a path to sustainability.<br />

Following an ambitious set of proposals in<br />

May – the ‘Europe on the Move’ package –<br />

we have just this month put forward new<br />

CO 2<br />

emissions standards for cars and vans<br />

for 2021 onwards, to stimulate uptake of low<br />

and zero-emission vehicles.<br />

The EU’s experience of implementing<br />

ambitious climate and energy policies in<br />

the past two decades shows that such<br />

action pays off, economically as well<br />

as environmentally. It creates more and<br />

better jobs as well as bringing innovative<br />

technologies and more sustainable<br />

The Clean Energy for All<br />

Europeans package will give a strong<br />

push to the clean energy transition and<br />

create jobs and growth.<br />

products to the market. Today, the EU is the<br />

world’s most CO 2<br />

-efficient large economy,<br />

according to the European Environment<br />

Agency’s emission database (EDGAR).<br />

The strong engagement of businesses,<br />

civil society and cities and regions<br />

continues to be a cornerstone of European<br />

success in driving forward responses to<br />

climate change. And so is the committed<br />

support of our citizens, with a survey<br />

earlier this year showing that three<br />

quarters of Europeans see climate change<br />

as a very serious problem and eight in ten<br />

agree that fighting climate change and<br />

using energy more efficiently can boost<br />

the economy and create jobs.<br />

The extreme temperatures across Europe<br />

in summer <strong>2017</strong> were a stark reminder<br />

that we must also address the impacts<br />

of climate change. We are making good<br />

progress in implementing the EU Strategy<br />

on Adaptation to <strong>Climate</strong> Change and we<br />

continue to support non-state actors in as<br />

many ways as possible. Our partnerships<br />

already include countless businesses, cities,<br />

local authorities and communities that are<br />

committed to taking concrete action.<br />

The Covenant of Mayors for <strong>Climate</strong> and<br />

Energy, an alliance of local and regional<br />

authorities voluntarily committed to taking<br />

climate action and sharing experiences,<br />

has exceeded all expectations. Last year<br />

it went global, joining forces with the<br />

Compact of Mayors to create the Global<br />

Covenant of Mayors for <strong>Climate</strong> and<br />

Energy, and now counts over 7,600 cities.<br />

Now more than ever, the world is<br />

looking to Europe for climate leadership.<br />

So our task is to keep delivering and<br />

driving the low-carbon transition forward –<br />

leading by example.<br />

31<br />


POLICY<br />





Nicolas Hulot,<br />

Minister for Ecological<br />

and Solidary Transition,<br />

France<br />

Credit: A. Bouissou, French Ministry for Ecological and Solidary Transition<br />

All over our planet, climate<br />

disruption is throwing lives into<br />

disarray – particularly among the<br />

poorest and most vulnerable communities.<br />

The frequency with which extreme climate<br />

events are occurring has provided a<br />

startling glimpse of what could become<br />

the norm in the 21st century.<br />

Although the situation is extremely<br />

worrying, it is by no means irredeemable;<br />

in fact, all the tools we need to reverse this<br />

trend are already at our disposal. While<br />

humanity has spent decades living within<br />

a system that threatens our survival as a<br />

species, we are also capable of building a<br />

society that is more moderate and more<br />

sustainable, founded on the principles of<br />

solidarity – inclusive cooperation. COP21<br />

showed that it is possible to achieve what<br />

many believed to be unattainable: bringing<br />

world leaders together to build the first<br />

global climate agreement, and setting<br />

objectives that will bind us together over<br />

the coming decades.<br />

Today, the challenge we face is greater<br />

than ever. As political leaders, we are the<br />

guardians of the Paris Agreement. It is our<br />

responsibility to do all that is within our<br />

power to uphold our commitments, by<br />

coordinating the many stakeholders who<br />

have already been mobilised to combat<br />

climate change. This is the purpose of<br />

the <strong>Climate</strong> Plan, unveiled by the French<br />

government in July <strong>2017</strong>. It aims to move<br />


faster and take our eff orts further with<br />

regard to climate change. The planned<br />

goal of reducing our country’s greenhouse<br />

gas emissions by 25 per cent was not<br />

suff iciently ambitious to meet the objectives<br />

set in December 2015. We are now aiming<br />

to achieve carbon neutrality by 2050.<br />

In order to do so, we must first move<br />

away from all activities with the potential<br />

to contribute to increased greenhouse<br />

gas emissions. With that in mind, the<br />

French Parliament is currently debating a<br />

bill that will bring an end to prospecting<br />

and extraction of both traditional and<br />

unconventional hydrocarbons. France<br />

has become the first country in the world<br />

to put forward a text that will initiate a<br />

progressive and irreversible end to oil and<br />

gas production within its borders by 2040.<br />

This ambition is just as evident in our aim<br />

to end the sale of petrol and diesel cars<br />

by 2040. The same is true for electricity<br />

production, for which we will cease using<br />

coal power plants by 2022.<br />

The transformations under way also<br />

represent a wealth of opportunity for<br />

companies active in the green economy.<br />

Conditions have never been so favourable:<br />

the renewable energy sector is progressing<br />

at an unprecedented rate, technological<br />

advances are allowing us to build homes<br />

that consume little to no energy, and more<br />

and more people are choosing to use clean<br />

methods of transport. Our citizens are<br />

aware of the threat that faces them, and are<br />

refusing to accept consumption methods<br />

that endanger their environment, their<br />

health and their future.<br />

We are determined to support all those<br />

who are working to stimulate innovation<br />

and advance our scientific understanding.<br />

To encourage climate research, the French<br />

president has already launched a platform<br />

– entitled ‘Make our planet great again’ –<br />

for the most promising projects. Because<br />

our future solutions are inherently linked to<br />

scientific advances, France will be hosting<br />

the 47th plenary session of the IPCC in the<br />

spring of <strong>2018</strong>.<br />

We will also be working to promote<br />

the concept of green financing. Our<br />

ambition is to put France at the centre of<br />

a movement to improve the way in which<br />

climate risks are taken into consideration<br />

in financial regulations. With its law on<br />

Energy Transition for Green Growth,<br />

France has become the first country in<br />

the world to require investors to publish<br />

information on how their investment<br />

policies take into account environmental<br />

criteria, social factors and quality of<br />

governance. We will also encourage our<br />

European and international partners to<br />

adopt the same approach.<br />

Finally, we wish to support all business<br />

sectors that will drive the evolution of<br />

France<br />

has become the<br />

first country in<br />

the world to put<br />

forward a text<br />

that will initiate a<br />

progressive and<br />

irreversible end<br />

to oil and gas<br />

production within<br />

its borders by<br />

2040.<br />

Credit: A. Bouissou, Terra, MTES<br />

our economy. I refer in particular to the<br />

circular economy, which accounts for<br />

over 800,000 jobs in France. Economic<br />

prospects are highly encouraging:<br />

recycling a tonne of waste generates<br />

30 times more jobs than sending it to<br />

landfill. We are currently working on a<br />

roadmap for the circular economy, which<br />

will be published in <strong>2018</strong> and will give real<br />

momentum to the pursuit of sustainable<br />

production and consumption.<br />

This is France’s vision for solidarity and<br />

ecological transition. This transition is<br />

for everyone, and will require everyone’s<br />

involvement. Companies and investors,<br />

as drivers of innovation, also have a role<br />

to play in this approach. Our objective is<br />

three-fold: to bring an end to excessive<br />

depletion of our natural resources, to<br />

direct capital towards economic activities<br />

that are compatible with our climate<br />

commitments, and to propose adaptive<br />

solutions that will protect our communities<br />

from climate-related disasters.<br />

We expressed this vision at the<br />

recent UN General Assembly with the<br />

presentation of the proposed Global Pact<br />

for the Environment, which will serve as a<br />

basis for environmental rights throughout<br />

the international community. Over the<br />

course of COP23, the upcoming <strong>Climate</strong><br />

Summit in December <strong>2017</strong>, and beyond,<br />

we will continue to place solidarity firmly<br />

at the centre of our ambitions for our<br />

society.<br />

POLICY<br />


POLICY<br />


NORWAY<br />

Vidar Helgesen, Minister of <strong>Climate</strong><br />

and Environment, Norway<br />

What strikes foreigners on<br />

the streets of Oslo is the<br />

large number of Teslas and<br />

other electric vehicles. Norway sells<br />

the highest proportion of electric cars<br />

in the world relative to the number of<br />

inhabitants. Recently we celebrated<br />

100,000 electric cars on Norwegian<br />

roads, and if one looks at the most<br />

popular models in the first half of <strong>2017</strong>,<br />

one has to look to the 10th spot to find a<br />

conventional fossil-fuelled car.<br />

In June <strong>2017</strong>, the share of electric in new<br />

car sales was 27.7 per cent. For the first<br />

time, more electric and hybrid cars were<br />

sold than diesel and gasoline cars. Our<br />

electric cars policy attracts interest from<br />

international media as well as politicians.<br />

It might seem a paradox that Norway,<br />

as a large oil and gas exporter, does<br />

its best to reduce the use of fossil fuels<br />

in transportation. Norway is, however,<br />

blessed with both renewable and fossil<br />

resources. While we export most of the<br />

oil and gas, domestic power generation is<br />

based on renewable energy sources. This<br />

is, indeed, a unique situation, which we<br />

will build upon in our policy to create a<br />

low emission society.<br />

During the last hundred years,<br />

hydropower has paved the way for the<br />

Norwegian economic and industrial<br />

development. Small local rivers<br />

brought power to small enterprises<br />

and households. In addition, we have<br />

developed large hydropower projects<br />

that have made energy-intensive industry<br />

in Norway a success. The renewable<br />

share of the power generation mix<br />

is 98 per cent, where 96.5 per cent<br />

comes from hydropower. In Norway,<br />

we have large hydropower reservoirs<br />

and interconnectors to Sweden and the<br />

Continent, allowing us to offer the Nordic<br />

and European power markets backup<br />

capacity when needed. The hydropower<br />

system works very well together with<br />

variable renewable energy sources like<br />

wind power and solar PV.<br />

Heating and transport still depend<br />

on fossil fuels, and the total renewable<br />

energy share in Norway is 69 per cent,<br />

calculated in accordance with the EU<br />

Renewable Directive. We will continue<br />

our efforts to increase the use of<br />

renewables in heating and transport. Use<br />

of oil for heating will be phased out. We<br />

have started electrifying Norway with<br />

renewable energy sources.<br />

The transport sector is key in reducing<br />

greenhouse gases and increased energy<br />

efficiency. Our technology shift to electric<br />

cars is being achieved by offering<br />

generous incentives. The problem right<br />

All around the world, cities,<br />

regions, businesses, and citizens<br />

are taking a leading role in fighting<br />

climate change.<br />

Hydropower is the dominant source of<br />

power generation in Norway<br />


POLICY<br />

Norway sells the highest proportion of electric cars in<br />

the world relative to the number of inhabitants.<br />

now is to build charging stations fast<br />

enough to keep pace with the sale of<br />

electric cars. We have also supported<br />

electric driven ferries. Today, more than<br />

50 battery electric or hybrid electric car<br />

ferries are either in the planning process<br />

or in construction in Norway. Electric<br />

ferries will become a normal sight in the<br />

coming years. The technology shift goes<br />

very fast. We are already seeing plans<br />

for electric driven trucks, ships and even<br />

short-distance aeroplanes.<br />

Reduced costs of renewable energy,<br />

in particular solar PV and wind power,<br />

and reduced battery costs, are spurring<br />

a very fast deployment of renewable<br />

energy. Norway has installed rooftop<br />

solar PV to charge the electric trucks.<br />

We shall certainly see more examples<br />

as soon as business actors realise<br />

opportunities.<br />

According to the IEA/IRENA report<br />

Perspectives for the Energy Transition,<br />

launched in March <strong>2017</strong>, energy efficiency<br />

will be the most important energy<br />

measure to achieve the long-term<br />

temperature goal of the Paris Agreement.<br />

Norway is one of the front runners<br />

when it comes to building codes. The<br />

government has supported large energy<br />

efficiency projects in energy intensive<br />

industries. Digitalisation and energy<br />

saving technologies, such as LEDs,<br />

With almost 100 per cent<br />

renewable power generation and our<br />

policy on energy efficiency, heating<br />

and transport, it should be possible<br />

to achieve a close to 100 per cent<br />

renewable share in the energy mix.<br />

offer numerous opportunities to reduce<br />

energy consumption and greenhouse<br />

gas emissions. Taking advantage of<br />

digitalisation opportunities and disruptive<br />

technologies will be part of green<br />

transformation in Norway.<br />

Exploration of oil and gas in Norway<br />

will not last for ever. Other sectors and<br />

business opportunities must replace<br />

the oil and gas sector when it comes<br />

to value creation and employment. The<br />

government has published a strategy<br />

on green competiveness, and we<br />

will follow up the roadmaps for a low<br />

emission future from as many as 15<br />

different sectors. It is encouraging to<br />

see the enthusiasm driving this vision of<br />

business opportunities combined with<br />

low emissions.<br />

With almost 100 per cent renewable<br />

power generation and our policy on<br />

energy efficiency, heating and transport,<br />

it should be possible to achieve a close<br />

to 100 per cent renewable share in the<br />

energy mix. Moreover, our export of<br />

renewable energy can contribute to an<br />

increased share of renewable energy in<br />

the power generation in other countries.<br />

Our policy to incentivise use of electric<br />

cars has already encouraged car<br />

manufactures to develop electric cars and<br />

launch new models in Norway. Teslas and<br />

other electric cars will be a more common<br />

sight in cities worldwide in the future.<br />


POLICY<br />


WAY TO<br />

GREEN<br />

GROWTH<br />


Lars Christian Lilleholt, Minister of<br />

Energy, Utilities and <strong>Climate</strong>, Denmark<br />

Since 1990 Denmark has cut<br />

its greenhouse gas emissions<br />

by 27 per cent, kept its energy<br />

consumption constant and still managed<br />

to increase its GDP significantly. Last year<br />

alone, the World Energy Council, the World<br />

Bank and the Cleantech Group published<br />

reports ranking Denmark as one of the<br />

world’s top performers when it comes<br />

to framework conditions for renewable<br />

energy investments and the ability to<br />

develop new clean-tech companies.<br />

Of course, these top results have not<br />

appeared out of nothing. Instead, they<br />

have been fostered through decades of<br />

hard work finding cost-eff ective solutions<br />

to limit the risks of global climate change<br />

and to seize the opportunities that follow<br />

the green transition.<br />

There are six main reasons for<br />

Denmark’s success. First, the overarching<br />

and long-term policy decisions for Danish<br />

energy have been characterised by broad<br />

political agreement between most parties<br />

in Parliament since the 1970s. This creates<br />

political stability, which is essential to<br />

investors who think for the long term.<br />

The current Danish government has set<br />

ambitious long-term goals, thus continuing<br />

this tradition. It is the government’s goal<br />

to cover at least half of Denmark’s total<br />

energy needs with renewable energy in<br />

2030 and to make Denmark independent<br />

of fossil fuels by 2050.<br />

Second, via a market-based approach<br />

to financial incentives, Denmark has<br />

advanced development in clean energy<br />

technology development, improved<br />

Credit: State of Green POLICY<br />


POLICY<br />

It is a key aim to work for a<br />

European electricity market which<br />

is integrated, market-based, and<br />

incentivises flexibility both on the<br />

supply and demand side.<br />

competition within the clean energy sector<br />

and lowered the costs of energy. Right<br />

now, wind power accounts for more than<br />

40 per cent of the Danish final electricity<br />

consumption, expected to rise to about 50<br />

per cent by 2020, owing to the significant<br />

onshore and offshore developments since<br />

2012. In the future, however, we must<br />

continue to develop a regulatory setup<br />

that can ensure a market-based path to<br />

further clean energy development.<br />

Denmark has a wealth of experience<br />

with very effective tendering procedures.<br />

At the end of 2016, Denmark held a tender<br />

for the new 600MW offshore wind farm<br />

Kriegers Flak. The tender was won by a<br />

bid of only five euro cents per kWh, a new<br />

world record at the time. In September<br />

<strong>2017</strong> the government went further along<br />

the path to market-based solutions for<br />

renewable energy sources, reaching an<br />

agreement on partially technology-neutral<br />

tenders with wind and solar PV for <strong>2018</strong><br />

Credit: State of Green<br />

38<br />

and 2019 for a combined DKr1 billion.<br />

Third, good conditions for research<br />

demonstration and development have<br />

been vital for the continued development<br />

of clean and more effective technologies.<br />

For example, at the Danish national test<br />

centres for wind turbines in Østerild<br />

and Høvsøre, which the government<br />

recently agreed to expand, we are<br />

fostering close cooperation between<br />

Danish universities and the wind power<br />

industry. The test centres encourage the<br />

increased development and production<br />

of wind power technology in Denmark,<br />

which is consistent with the government’s<br />

ambition of maintaining and nursing the<br />

best possible framework conditions for the<br />

renewable energy industry. In this way, we<br />

can fulfil our ambition of covering at least<br />

50 per cent of our energy needs in 2030<br />

from renewable energy.<br />

Furthermore, Denmark is part of Mission<br />

Innovation (MI) and we are committed<br />

Credit: State of Green<br />

to doubling public investments in clean<br />

energy research development over a<br />

five-year period, and to opening up the<br />

Danish Programme of Development and<br />

Demonstration of Energy Technology<br />

to foreign investors. This is good news<br />

for Denmark and the global climate, but<br />

equally good news for other MI members<br />

who can profit from cooperation and<br />

investment opportunities.<br />

Fourth, Denmark benefits from<br />

being part of a well-functioning and<br />

liberalised electricity market which is<br />

highly integrated with our neighbouring<br />

countries. Consequently, the wholesale<br />

price of electricity in Denmark is the<br />

same as in at least one neighbour<br />

country 90 per cent of the time. When<br />

the wind blows in Denmark, Danish<br />

electricity is sold to Norway, Sweden<br />

and Germany and, conversely, when the<br />

wind is not blowing, Norway can export<br />

electricity back to Denmark. This ensures<br />

security of supply, supports a high level

POLICY<br />

The export of energy technology<br />

makes up around 11 per cent of<br />

Denmark’s total exports of goods, one<br />

of the highest shares in Europe.<br />

of integration of renewable energy into<br />

the electricity market, and provides low<br />

prices for the consumers.<br />

Our cooperation with our neighbouring<br />

countries underlines the fact that national<br />

energy frameworks cannot stand alone.<br />

Large-scale penetration of renewable<br />

energy is most effectively happening by<br />

maximising the geographical area for<br />

balancing across borders, so weatherdependent<br />

production patterns can<br />

complement each other. To that end, it is a<br />

key aim to work for a European electricity<br />

market which is integrated, market-based,<br />

and incentivises flexibility both on the<br />

supply and demand side.<br />

Fifth, Denmark is actively committed<br />

to sharing experience with the rest of the<br />

world. As a consequence, Denmark has<br />

government-to-government cooperation<br />

with 12 countries across the globe with a<br />

focus on wind power production, energy<br />

efficiency, district heating and intelligent<br />

energy planning. The same is true for our<br />

work in multilateral organisations where<br />

Denmark actively seeks to exchange best<br />

practice on these topics where the country<br />

has valuable experience to share.<br />

Sixth, these effects have helped<br />

develop a highly competitive energy<br />

technology sector in Demark. As a result,<br />

the clean energy transition has gone<br />

hand in hand with strong exports and<br />

economic growth. The export of energy<br />

technology makes up around 11 per cent<br />

of Denmark’s total exports of goods, one<br />

of the highest shares in Europe.<br />

It is, however, too soon to fully enjoy the<br />

fruits of our labour. The Paris Agreement<br />

sets the direction for a green transition<br />

and sends a strong signal to both civil<br />

society and the private sector that the<br />

world is moving in a green direction. To<br />

achieve the goals of the Paris Agreement,<br />

investments in the green transition<br />

are imperative. We should use this as<br />

an opportunity to share our valuable<br />

experiences and competences.<br />


POLICY<br />






Kimmo Tiilikainen, Minister of the<br />

Environment, Energy and Housing,<br />

Finland<br />

40<br />

Teemu Kuusimurto / Environmental Administration<br />

We live in an era where the linear<br />

economic model has come to<br />

its end, and the world has to<br />

move towards a revolutionary circular<br />

economy where the value of materials<br />

and products is maximised and kept in<br />

use for as long as possible. In Finland<br />

we aim to lead this progress by example<br />

and to create solutions to the global<br />

sustainability crisis.<br />

In the coming decades we will need<br />

more of everything based on natural<br />

resources globally: food, feed, water,<br />

energy, materials and space. At the same<br />

time the global capacities to produce<br />

these resources sustainably are severely<br />

exceeded. In this situation, the basic<br />

principles of the circular economy<br />

– reuse, recycle, remanufacture and<br />

repair – provide the key for a sustainable<br />

future. We need a paradigm change to an<br />

economy where waste is regarded as a<br />

valuable resource and production takes<br />

giant leaps towards more eff icient use of<br />

resources; to an economy where people<br />

circulate and share materials, services,<br />

technologies, solutions and ideas.<br />

We need a transition from a pipeline<br />

economy to a circular economy.<br />

Until recently, the role of renewable<br />

resources has been hidden behind the<br />

main façade of circular economy. This is<br />

particularly noticeable in Finland, where<br />

we have significant forest resources,<br />

and eff ective tools and the requisite<br />

knowledge for managing and using<br />

them sustainably. In many countries and<br />

even continents bio-resources are not<br />

similarly in focus, despite substantial<br />

capacities for sustainable bio-production.

We are testing new<br />

solutions, particularly for<br />

sustainable food systems,<br />

timber construction,<br />

recycling of municipal<br />

waste and rehabilitation of<br />

contaminated land.<br />

The reason for this can be an abundance<br />

of non-renewable resources as well as<br />

technological solutions and economic<br />

structures, which are not fit for sustainable<br />

use of renewables.<br />

However, a transition from a fossil<br />

economy to a bio-based economy is also<br />

essential for a sustainable future. We need<br />

to combine the sustainable use of biobased<br />

renewable resources and ‘carbon<br />

cycles’ with a circular economy. And this<br />

brings us to a circular bio-economy.<br />

‘Bio-economy’ refers to an economy<br />

that relies on renewable natural resources<br />

to produce food, energy, products and<br />

services. A bio-economy strives to<br />

reduce our dependency on fossil and<br />

non-renewable natural resources. In<br />

transitioning towards bio-economy<br />

we must respect the limits of natural<br />

capacities and work along the principles<br />

of a circular economy. A sustainable<br />

bio-economy also has respect for<br />

biodiversity and the recreational values<br />

that our planet and nature off er us. It<br />

aims to increase our understanding<br />

of how dependent we are on nature,<br />

natural resources and their sustainable<br />

management.<br />

In climate policy, Finland is strongly<br />

committed to the Paris <strong>Climate</strong><br />

Agreement. We are determined to build<br />

a carbon neutral Finland by 2045 and<br />

to do our share in balancing global<br />

emissions and carbon sinks in the<br />

second half of the century. The circular<br />

bio-economy plays an important role in<br />

this work.<br />

Finland’s aim is to lead the transition<br />

towards a circular bio-economy by<br />

example and concrete measures. We<br />

are testing new solutions, particularly<br />

for sustainable food systems, timber<br />

construction, recycling of municipal<br />

waste and rehabilitation of contaminated<br />

land. In addition, the circular economy<br />

roadmap for Finland, developed by<br />

the Finnish Innovation Fund Sitra in<br />

co-operation with key ministries and<br />

stakeholders, includes more than 60<br />

concrete projects and administrative<br />

measures that support the concept of<br />

circular economy.<br />

In our national Sustainable Urban<br />

Development programme we are focusing<br />

in particular on low carbon, resourceeff<br />

icient and smart services as well as<br />

promoting equality and social cohesion.<br />

The programme also aims to enhance<br />

environmentally and socially sustainable<br />

solutions and strengthen business based<br />

on them. In addition, the government<br />

supports urban circular economy and<br />

cleantech initiatives and pioneering<br />

networks, such as the Smart and Clean<br />

Foundation in the Helsinki Metropolitan<br />

Area, the wide networks of Finnish<br />

Sustainable Communities (FISU) and<br />

Carbon Neutral communities (HINKU).<br />

We manage our forests, waters and<br />

other natural resources wisely and<br />

sustainably. After all, nature and forests<br />

are our national treasures – and close<br />

to the hearts of Finns. Despite rising<br />

investments in the forest industry and<br />

increasing use of wood, the growth of<br />

forests in Finland exceeds the amount<br />

harvested. With sustainable forest<br />

management that promotes forest<br />

growth and respects biodiversity, our<br />

carbon sinks remain significant and we<br />

are able to benefit from renewable raw<br />

materials and energy for developing a<br />

circular bio-economy. This also supports<br />

the active role of forests in combating<br />

climate change, as envisaged in the Paris<br />

Agreement.<br />

We must all be a part of the change. We<br />

need to make more sustainable choices as<br />

consumers – for example at the grocery<br />

store – and make the most of shared<br />

ownership and low-carbon living. But<br />

most importantly, we need a revolution<br />

in the way we think about the economy.<br />

This change in our mindset, together<br />

with bold policy measures and innovative<br />

businesses, will foster the paradigm<br />

change from fossil, pipeline economy to a<br />

circular bio-economy.<br />

41<br />


POLICY<br />

A LOW<br />

CARBON<br />


THE UK<br />

Claire Perry, Minister for <strong>Climate</strong><br />

Change and Industry, UK<br />

The UK is unequivocally committed<br />

to a low carbon future. We were,<br />

after all, the first country in the<br />

world to introduce a statutory <strong>Climate</strong><br />

Change Act which binds us to five-year<br />

carbon budgets and holds us to cutting<br />

our harmful greenhouse gas emissions by<br />

at least 80 per cent by 2050.<br />

Since 1990, our economy has grown<br />

by 67 per cent and, at the same time, we<br />

have managed to reduce emissions by 42<br />

per cent – the best performance of any G7<br />

country. The latest research shows that the<br />

UK was the fastest of any country in the<br />

G20 to decarbonise last year.<br />

Our low carbon economy is growing<br />

rapidly and something we are determined<br />

to build on and take advantage of as part<br />

of the UK’s industrial strategy. Analysis<br />

produced for the Committee on <strong>Climate</strong><br />

Change estimated that the low carbon<br />

economy could grow 11 per cent a year<br />

from now until 2030. In just 13 years, we<br />

could see up to two million more UK jobs<br />

in this sector. Because of the excellent<br />

progress we are making I believe the<br />

UK can lead the world in creating clean<br />

technology jobs and businesses.<br />

In October <strong>2017</strong>, the UK government<br />

published the Clean Growth Strategy. This<br />

blueprint for a low carbon future will sit<br />

at the heart of our industrial strategy. It<br />

aims to help British businesses increase<br />

their energy productivity by at least 20<br />

per cent by 2030. It will ensure large<br />

companies cut their bills, through an<br />

industrial energy efficiency scheme, and<br />

provide international leadership in carbon<br />

We must ensure that British<br />

businesses, innovators and<br />

entrepreneurs also take full advantage<br />

of the huge, global economic<br />

opportunities this future brings.<br />


POLICY<br />

capture, usage and storage. We know this<br />

technology holds promise and that the<br />

costs need to come down – we intend to<br />

lead that challenge.<br />

Our Clean Growth Strategy will also<br />

make our homes warmer and cheaper to<br />

run with about £3.6 billion (US$4.75 billion)<br />

to upgrade around one million homes<br />

through the Energy Company Obligation.<br />

On our roads, our strategy will help reduce<br />

air pollution by increasing the number<br />

of electric vehicles and creating the best<br />

charging infrastructure in Europe. On top<br />

of this, we will end the sale of new petrol<br />

and diesel cars in our country by 2040.<br />

Across the piece, we are spending<br />

£2.5 billion (US$3.3 billion) in innovation<br />

to support the transition to a low carbon<br />

economy – a strong symbol of our<br />

commitment to a low carbon future in<br />

the UK.<br />

From our point of view in government,<br />

this is a win-win: we continue to cut<br />

emissions and in doing so also cut<br />

consumer bills, drive economic growth,<br />

create high-value jobs and improve<br />

our quality of life. But just having the<br />

On our roads, our strategy will<br />

help reduce air pollution by increasing<br />

the number of electric vehicles<br />

and creating the best charging<br />

infrastructure in Europe.<br />

government commit to a low carbon future<br />

for the UK is not enough. We must ensure<br />

that British businesses, innovators and<br />

entrepreneurs also take full advantage of<br />

the huge, global economic opportunities<br />

this future brings. That is why we have<br />

committed to the largest increase in<br />

public spending for investment in science,<br />

research and innovation in almost 40 years.<br />

With the signing of the Paris climate<br />

agreement – in which UK leadership<br />

played a pivotal role – there is an<br />

unstoppable global shift towards clean<br />

technologies, infrastructure, industry and<br />

jobs. It is critical that the international<br />

community is fully behind this shift. We<br />

need to make sure all countries maintain<br />

their progress towards meeting the longterm<br />

goals in the Paris agreement.<br />

As the UK Prime Minister, Theresa May,<br />

said in the Clean Growth Strategy: “Clean<br />

growth is not an option, but a duty we owe<br />

to the next generation.” There is a long way<br />

to go, but I am confident that we are on<br />

the right path and that the UK can help<br />

lead the world down it.<br />


POLICY<br />

The Arctic is heating up<br />

twice as fast as the rest of the<br />

planet, with perilous impacts.<br />

CLEAN<br />

GROWTH<br />



CANADA<br />


Catherine McKenna,<br />

Minister of Environment and<br />

<strong>Climate</strong> Change, Canada<br />

Canada’s Arctic is a place of<br />

stunning beauty. It is found within<br />

an expanse of sprawling tundra,<br />

blue oceans, and biodiversity that includes<br />

beluga and bowhead whales and polar<br />

bears. It is also an area under severe threat<br />

from the ravages of climate change. Today<br />

the Arctic is heating up twice as fast as the<br />

rest of the planet, with perilous impacts.<br />

During an expedition I took north<br />

this summer I heard from a young Inuit<br />

teenager. He told me of the problems<br />

facing his community: melting permafrost,<br />

thinning polar bears and disappearing<br />

caribou. Other Inuit described hunters<br />

falling through melting sea ice – events<br />

that are altering the way they have hunted<br />

since time immemorial.<br />

It is because of these impacts – and the<br />

eff ects of climate change we see globally –<br />

that the world is taking action.<br />

In 2015, Canada and close to 200 other<br />

countries signed on to the Paris Agreement;<br />

and in doing so, committed to prevent<br />

global average temperatures from rising<br />

above 2°C, while striving to keep it below<br />

1.5°C. But to accomplish this, to ensure a<br />

better world for future generations, we must<br />

ratchet up our ambition.<br />

In Canada, we are working hard to do<br />

our part. In 2016, together with provincial,<br />

territorial and indigenous leaders, I<br />

announced our made-in-Canada climate<br />

plan – a plan to reduce our carbon<br />

emissions, spark innovation and create well-<br />

paying jobs. This is a plan that will ensure a<br />

healthy environment and a strong economy.<br />

In the 21st century, it is no longer<br />

acceptable to pollute for free and send<br />

the tab to the next generation. In Canada<br />

we will soon be pricing carbon emissions<br />

across our entire country. We are putting<br />

a price on what we don’t want – pollution<br />

– and investing the revenue in things we<br />

do want, such as clean energy, public<br />

transport, and more good jobs. Already 80<br />

per cent of Canadians live in a province<br />

that prices carbon emissions.<br />

Of course, pricing pollution is just one<br />

action needed to address climate change.<br />

To further reduce our emissions and<br />

foster clean growth, we are improving our<br />

public transport, constructing buildings<br />

that waste less energy, and supporting<br />

businesses to develop clean technologies.<br />

In fact, Canada is quickly becoming a<br />

major competitor in the renewable-energy<br />

and cleantech industries. Earlier this year,<br />

11 of Canada’s cleantech companies were<br />

ranked within the top 100 in the world.<br />

Companies like Carbon Cure are taking<br />

emissions from factories and injecting<br />

them into cement, making it stronger<br />

and cheaper. And companies like Ballard<br />

Power are creating fuel cells used in zero<br />

emission vehicles around the world.<br />

Canadians understand that transitioning<br />

to clean growth is good for the environment<br />

and the economy; that hundreds of billions<br />

During a kayak trip to Nunavut, Catherine McKenna announced<br />

the expansion of Canada’s largest national marine conservation<br />

area (NMCA) in Lancaster Sound (Tallurutiup Imanga). She is<br />

pictured with Moosa Akavak, an Inuit leader from Nunavut.<br />

of dollars are already being invested<br />

globally – to spark new technologies and<br />

drive new possibilities; and that innovators,<br />

engineers and entrepreneurs are catalysing<br />

the market of tomorrow.<br />

We also know that clean solutions<br />

support healthier communities. That<br />

is why we are phasing out coal-fired<br />

electricity by 2030. We know that<br />

clearing smog from our skies will<br />

prevent cases of asthma, reduce hospital<br />

bills and emergency room visits, and<br />

save lives. It will also reduce greenhouse<br />

gas emissions by 5 million tonnes a year,<br />

the equivalent of taking 1.3 million cars<br />

off the road.<br />

When I think of the urgent need to<br />

tackle climate change, I keep coming<br />

back to my visit to Canada’s Arctic. Young<br />

Inuit described to me their love for the<br />

land and sea: the majestic ice flows,<br />

roaming caribou, and teeming fish found<br />

throughout. And they told me of the<br />

urgency to protect their home from the<br />

threats of climate change.<br />

So as we gather in Bonn this year, the<br />

task is clear: we must raise our ambition,<br />

work harder, and take concrete steps to<br />

meet our emissions targets. This is the<br />

right thing to do for our environment. The<br />

economic opportunities are enormous.<br />

And it will ensure a cleaner, healthier, and<br />

more prosperous planet for our children<br />

and grandchildren.<br />

45<br />


POLICY<br />


BE AT THE<br />

HEART OF<br />


Isabella Lövin, Deputy Prime Minister<br />

and Minister for International<br />

Development Cooperation and<br />

<strong>Climate</strong>, Sweden<br />

While women are more<br />

vulnerable to the effects of<br />

climate change, they also<br />

have fewer opportunities to<br />

make decisions on how to<br />

deal with it.<br />

Gender often remains the untold<br />

story behind climate change.<br />

While climate change is a global<br />

phenomenon, its impact is not spread<br />

across a level playing field. Its eff ects are<br />

felt locally, and poor people suff er the most.<br />

Among the world’s 1.3 billion poor people,<br />

the majority are women.<br />

During the past few decades,<br />

considerable achievements have been<br />

made in narrowing the gender gap in<br />

many countries. Nevertheless, across<br />

Credit: Kristian Pohl/Regeringskansliet<br />


the global spectrum, women tend to be<br />

marginalised from economic and political<br />

power, and have limited access to financial<br />

and material resources. This increases<br />

their vulnerability to climate change and<br />

limits their potential to adapt. Women<br />

are also often less represented in the<br />

corridors of power; have fewer legal rights,<br />

including access to land; and occupy<br />

fewer leadership roles in the workplace.<br />

This means that while women are more<br />

vulnerable to the eff ects of climate change,<br />

they also have fewer opportunities to<br />

make decisions on how to deal with it. We<br />

must change this. Women have the right,<br />

and need, to be at the forefront of eff orts to<br />

deal with both climate adaptation and the<br />

transition to a zero carbon economy.<br />

I am proud to represent the first<br />

explicitly feminist government in the world,<br />

one that also has the goal of making<br />

Sweden the world’s first fossil-free welfare<br />

nation. I strongly believe that the major<br />

political and environmental challenges<br />

of today, like climate change, can and<br />

must be turned into opportunities for<br />

cooperation and confidence-building that<br />

can help advance gender equality, prevent<br />

conflicts and deliver positive outcomes for<br />

all communities across borders.<br />

There are numerous examples of<br />

renewable energy investments that also<br />

contribute to increased employment<br />

opportunities for women that foster<br />

female entrepreneurship. One example<br />

that illustrates this is the KawiSafi<br />

project, an investment fund that invests<br />

in clean energy companies in Rwanda<br />

and Kenya. The KawiSafi project has<br />

dedicated funds to train women to<br />

become solar technicians, while also<br />

supporting women-led micro-finance<br />

groups to generate demand for solar<br />

energy. The majority of the populations<br />

in Rwanda and Kenya are not connected<br />

to main power grids. Subsequently, many<br />

use oil or kerosene for domestic power<br />

generation. These fossil fuels are often<br />

expensive as they are imported, while<br />

noxious fumes pose a serious health<br />

risk – especially to women and girls, who<br />

Ghana Bamboo Bikes is a socio-ecological green initiative run by a group of<br />

enterprising women and young people in Ghana.<br />

Credit: Jbdodane/Flickr<br />

generally spend more time performing<br />

household work. The move to solar<br />

energy can thus reduce emissions and<br />

domestic budgets, while also improving<br />

women’s and girls’ health. This is a clear<br />

gender co-benefit of climate action.<br />

Another example of how women can<br />

play a major role as business leaders and<br />

help drive the transition toward sustainable<br />

economic growth and development is<br />

Ghana Bamboo Bikes. Ghana Bamboo<br />

Bikes is a socio-ecological green initiative<br />

run by a group of enterprising women and<br />

young people who build bicycles out of<br />

an unlikely material: bamboo. Ten farmers<br />

grow the bamboo, and 25 builders craft<br />

it into environmentally friendly bikes that<br />

can be used on Ghana’s bumpy roads or<br />

exported overseas. Bernice Dapaah, the<br />

founder and CEO of Ghana Bamboo Bikes,<br />

plans to build two new factories soon,<br />

adding 50 more workers in communities<br />

with high unemployment.<br />

A feminist approach to climate action<br />

is not only an issue of rights, it is also<br />

smart policy for employment opportunities<br />

and sustainable economic growth.<br />

Devising ways to consider gender in<br />

climate action will not always be easy<br />

or obvious. Societies are made up of<br />

complex relationships, sometimes based<br />

on diff ering structures of kin, power and<br />

financial resources. But continuing eff orts<br />

to place gender consideration at the<br />

centre of climate finance are necessary.<br />

The world clearly needs more women<br />

climate leaders, whether around the<br />

tables where policy is made, or at the<br />

helm of businesses, steering them toward<br />

sustainability.<br />

47<br />


POLICY<br />




CHANGE<br />

Scene from Les Cayes, Haiti, in the aftermath of Hurricane Matthew,<br />

the category 4 storm which made landfall in the country on 4 October 2016<br />


POLICY<br />

Robert Glasser, UN Secretary-<br />

General’s Special Representative for<br />

Disaster Risk Reduction and Head<br />

of the UN Office for Disaster Risk<br />

Reduction (UNISDR)<br />

This year there has been<br />

an accumulation of evidence to<br />

support the claim that 90 per cent<br />

of disasters now are weather and<br />

climate related.<br />

Credit: Logan Abassi, UN Photo/Flickr<br />

Anyone who followed the recent<br />

visit of the UN Secretary-General,<br />

António Guterres, to the Caribbean<br />

islands of Barbuda and Dominica can<br />

have no doubts about the existential threat<br />

that extreme weather events pose for<br />

small islands battling the eff ects of climate<br />

change. Mr Guterres is much travelled<br />

and has seen many disasters, but he<br />

commented that he had never seen such<br />

‘a high level of devastation’ as the one that<br />

he witnessed in Barbuda after the passage<br />

of Hurricane Irma, which rendered the<br />

island uninhabitable. Days later, Hurricane<br />

Maria ripped off roofs and stripped the<br />

leaves from the trees in Dominica’s rain<br />

forest which is central to the island’s<br />

tourism industry and status as a UNESCO<br />

World Heritage site.<br />

Following those visits, the Secretary-<br />

General made a stark pronouncement:<br />

“The link between climate change and<br />

the devastation we are witnessing is clear,<br />

and there is a collective responsibility of<br />

the international community to stop this<br />

suicidal development.” This year there<br />

has been an accumulation of evidence<br />

to support the claim that 90 per cent of<br />

disasters now are weather and climate<br />

related.<br />

Over the last 18 months, 20 countries<br />

have declared drought emergencies,<br />

notably across the Horn of Africa where<br />

hunger is forcing people off the land in<br />


POLICY<br />

large numbers. In South Asia, monsoon<br />

rains and floods have made life miserable<br />

for 40 million people in Bangladesh,<br />

India and Nepal. The United States has<br />

suffered several major calamities this year<br />

including hurricanes, floods, drought and<br />

wildfires. The total cost of these events<br />

has yet to be estimated, but <strong>2017</strong> could<br />

well be the most expensive year on record<br />

in terms of economic losses caused by<br />

weather and climate extremes.<br />

Global warming is implicated in many<br />

of these events, triggering variability<br />

of weather and climate, resulting in<br />

unprecedented changes in rainfall<br />

patterns, extreme heatwaves, more<br />

destructive hurricanes and more powerful<br />

storm surges associated with rising and<br />

warming seas.<br />

As nations meet at the <strong>Climate</strong> Change<br />

Conference in Bonn, COP23, it is clear<br />

that the level of ambition in reducing<br />

greenhouse gases needs to be raised<br />

if we are to succeed in keeping the<br />

global temperature rise well below 2˚C,<br />

or the more desirable target of 1.5˚C as<br />

outlined in the Paris Agreement. At the<br />

same time, we have to recognise that we<br />

will continue to live with the abnormal<br />

and often unforeseen consequences of<br />

existing levels of greenhouse gases in the<br />

atmosphere for a long time to come.<br />

This is why it is critically important that<br />

we invest seriously in measures to help<br />

us to reduce disaster mortality, reduce the<br />

Building a retaining wall in<br />

Afghanistan to limit flooding<br />

Children take part in a mangrove<br />

restoration project in Camotes Islands,<br />

Philippines<br />

numbers of people losing their homes and<br />

jobs in disasters, reduce overall economic<br />

losses, and reduce damage to critical<br />

infrastructure on the scale we have seen,<br />

for example, in Puerto Rico following<br />

hurricane Maria.<br />

These are key goals among the seven<br />

targets laid out in the Sendai Framework<br />

for Disaster Risk Reduction that was<br />

adopted two years ago by UN member<br />

states. In <strong>2018</strong> we are poised to launch<br />

the Sendai Monitor, which will aid<br />

governments to measure their losses<br />

and improve their understanding of their<br />

exposure to disaster risk and therefore<br />

Credit: UNOPS/Flickr<br />

Credit: Plan International/Flickr<br />

where they need to concentrate their<br />

investments to avoid unnecessary losses.<br />

The UN Office for Disaster Risk<br />

Reduction (www.unisdr.org) identifies<br />

the key drivers of disaster risk as<br />

poverty, unplanned urbanisation, the<br />

loss of protective eco-systems and<br />

weak governance. <strong>Climate</strong> change and<br />

population expansion into hazard-prone<br />

areas all ratchet up a country’s risk<br />

exposure and vulnerability to disaster<br />

losses.<br />

Plans to reduce disaster risk need to<br />

include measures that reduce climate<br />

risk. A multi-hazard approach to disaster<br />

risk management requires integration of<br />

disaster risk reduction and climate change<br />

adaptation, thus avoiding duplication of<br />

effort, maximising scarce resources and<br />

making life easier for countries reporting<br />

on progress in achieving the Sustainable<br />

Development Goals, the aims of the Paris<br />

Agreement on <strong>Climate</strong> Change, and the<br />

Sendai Framework.<br />

The Sendai Framework has set<br />

a deadline of 2020 “to substantially<br />

increase the number of countries with<br />

national and local disaster risk reduction<br />

strategies”. Between the launch of the<br />

Sendai Monitor next year and the drafting<br />

of these strategies, there is a window of<br />

opportunity to strengthen risk governance<br />

and ensure that we are equipped and<br />

prepared for the century ahead that will<br />

see global population rise along with<br />

exposure to extreme weather events.<br />

The worst disasters that could happen<br />

have not happened yet and we need to be<br />

resilient and prepared.<br />




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53<br />






STATES<br />

Thoriq Ibrahim, Minister of<br />

Environment and Energy of the<br />

Republic of Maldives<br />

No country or region is immune<br />

from climate change, but we are<br />

not equally vulnerable. For small<br />

islands, climate change poses particular<br />

risks, especially from storms and sea level<br />

rise. For this reason, it is often said that we<br />

are on the front line of the crisis. We are<br />

also emblematic of the new policies the<br />

international community needs to pick up<br />

the pieces after disaster strikes.<br />

Hurricanes Irma and Maria, both<br />

uniquely powerful storms that laid waste<br />

across Barbuda, Cuba, the Bahamas<br />

and Puerto Rico, and caused significant<br />

damage in other parts of the Caribbean,<br />

graphically illustrated the cost of our<br />

inaction on climate change. In 2016,<br />

Cyclone Winston, the strongest tropical<br />

storm to ever make landfall in the<br />

Southern Hemisphere, wreaked havoc on<br />

Fiji. Three record storms and unimaginable<br />

devastation in two years. The new reality<br />

of life in the ‘anthropocene’.<br />

Islands are not the only ones at risk, of<br />

course. Hurricane Harvey dumped some<br />

It is no surprise that the elevated<br />

risks we face often make the cost of<br />

insurance premiums prohibitive,<br />

if coverage is available at all.<br />

32 trillion gallons of water in Texas and<br />

Louisiana. Irma also severely damaged<br />

the lower Florida Keys. Nor are storms the<br />

only climate impact the world is suffering<br />

from these days. Floods in South Asia have<br />

claimed thousands of lives in the past few<br />

months alone. Earlier this year, parts of<br />

Africa endured deadly droughts.<br />

To be sure, the cyclones and hurricanes<br />

have refocused attention on the need<br />

to operationalise a loss and damage<br />

mechanism as soon as possible.<br />

The plan of the Alliance of Small Island<br />

States (AOSIS), first articulated in the<br />

1990s, now has an opportunity to be<br />

turned into action under the Warsaw<br />



International Mechanism on Loss and<br />

Damage. The AOSIS plan envisions a<br />

three-part organisational structure housed<br />

under the UNFCCC with oversight from<br />

technical and finance panels. Linkages<br />

could also be drawn to existing adaptation<br />

funds as well as a number of UN bodies,<br />

non-governmental organisations and the<br />

private sector.<br />

The first component recognises that<br />

managing climate impacts demands<br />

acquiring baseline historical information<br />

about weather hazards and quantified<br />

assessments of a variety of new risks.<br />

The data should be used to guide the<br />

development and implementation of<br />

country-specific measures that reduce<br />

exposure to climate impacts in the first place.<br />

A second part resembles insurance<br />

systems commonly found in the developed<br />

world and would cover countries for costs<br />

associated with sudden climate impacts,<br />

such as tropical storms, hurricanes,<br />

floods, and droughts. This is particularly<br />

relevant for small islands, because our<br />

populations tend to be concentrated in<br />

highly vulnerable coastal zones. And it is<br />

no surprise that the elevated risks we face<br />

often make the cost of insurance premiums<br />

prohibitive, if coverage is available at all.<br />

Finally, the plan calls for the creation<br />

of an international solidarity fund, or<br />

‘mechanism’, that would compensate<br />

countries for economic and noneconomic<br />

losses stemming from slowonset<br />

climate impacts, such as sea-level<br />

rise, ocean acidification, coral bleaching,<br />

saltwater intrusion and desertification.<br />

This could include lost revenue to the<br />

tourism and fishing industries, cultural<br />

impacts, and, in the worst case, the cost<br />

of relocation should islands become<br />

uninhabitable.<br />

We have seen what it is like to be on<br />

the front line of climate change, and what<br />

it takes to make lives whole again. COP23<br />

is our next opportunity to take action: we<br />

had better seize it.<br />



$70 TRILLION<br />

GLOBAL<br />




Andrew Steer, President of the<br />

World Resources Institute (WRI)<br />

56<br />

Something very important is<br />

happening in global finance:<br />

the US$70 trillion in institutional<br />

investment pools is turning a little greener.<br />

A Working Paper from WRI (www.wri.org),<br />

Navigating the Sustainable Investment<br />

Landscape, has found that the prospects<br />

for sustainable investing are strong, and by<br />

overcoming the remaining obstacles the<br />

market can indeed reach a tipping point.<br />

Many portfolio managers used<br />

to believe – and some still do – that<br />

allocating funds towards more sustainable<br />

companies and investments would<br />

require sacrificing yield. But empirical<br />

evidence shows that, on average, this is<br />

not the case. In some instances, taking<br />

sustainability into account can actually<br />

enhance corporate financial performance,<br />

while investment funds oriented to<br />

sustainability are likely to perform as well<br />

or better than traditional funds.<br />

Sustainable Reality, a recent study of<br />

more than 10,000 mutual funds by the<br />

Morgan Stanley Institute for Sustainable<br />

Investing, found that sustainable equity<br />

funds usually had equal or higher median<br />

returns and equal or lower volatility than<br />

traditional funds. An analysis by Oxford<br />

University and Arabesque Partners, From<br />

the Stockholder to the Stakeholder, found a<br />

positive relationship between sustainability<br />

and financial performance of stock prices<br />

for 80 per cent of the 41 studies reviewed.<br />

Asset owners – the pension funds,<br />

endowments, foundations and people who<br />

own the capital invested in corporations<br />

– are in it for the long haul, which<br />

gives them a diff erent perspective from<br />

investment managers aimed at short-term<br />

profit. Long-term investors are eager to<br />

ensure their capital can weather a range<br />

of environmental, social and governance<br />

(ESG) risks, especially climate change.


In some instances, taking<br />

sustainability into account can<br />

actually enhance corporate financial<br />

performance.<br />

Hurricane Maria near Puerto Rico.<br />

Photo by Stuart Rankin/flickr<br />

Back-to-back billion-dollar natural<br />

disasters from South Asia to south Texas,<br />

from hurricanes in the Caribbean to<br />

wildfires in the Rocky Mountains, show a<br />

clear pattern of high cost.<br />

Chief investment officers and individual<br />

investors are taking note. Mainstream<br />

financial players including former New<br />

York Mayor Michael Bloomberg are calling<br />

for corporations to take more action. A<br />

global task force set up by the G20 top<br />

industrialised nations – the Task Force on<br />

<strong>Climate</strong>-Related Disasters (TFCD) – has<br />

developed a voluntary framework for<br />

companies to disclose the financial impact of<br />

climate-related risks and opportunities. The<br />

TFCD has drawn support from more than<br />

100 companies with US$11 trillion in assets.<br />

And yet the battle is far from won:<br />

most fund managers still chase the<br />

short money. But the trend is in the right<br />

direction, especially when asset owners<br />

apply pressure, as they have in <strong>2017</strong>. A<br />

case in point: 62 per cent of ExxonMobil’s<br />

shareholders voted to instruct the oil<br />

giant to report on the business impact of<br />

global measures to limit warming to 2˚C<br />

above pre-industrial levels. This followed<br />

similarly successful shareholder votes<br />

at Occidental and PPL, a large utility<br />

holding company.<br />

Investment heavyweights Blackrock,<br />

Vanguard and State Street – which<br />

collectively own about 18 per cent of<br />

ExxonMobil – all reportedly voted for the<br />

resolution, which was a vote for longterm<br />

protection for investors’ capital. The<br />

vote was also in line with Blackrock CEO<br />

Larry Fink’s 2016 demand that company<br />

CEOs manage for the long term, even<br />

though Blackrock and other firms had<br />

been reluctant to vote against company<br />

management, especially on issues related<br />

to climate change.<br />

These investment houses are not alone,<br />

and WRI is part of this transition. More than<br />

300 companies around the world have<br />

committed to setting targets to reduce<br />

climate-warming emissions in their value<br />

chains consistent with the best climate<br />

science as part of the Science Based<br />

Targets initiative. The Institute’s Sustainable<br />

Investing Initiative offers tailored data,<br />

research and peer-to-peer learning to<br />

accelerate the shift toward investment that<br />

integrates ESG factors from the start.<br />

Ultimately, we should settle for nothing<br />

less than 100 per cent of investors<br />

taking ESG into account when making<br />

investment decisions. We are not there<br />

yet, but by sharing knowledge about the<br />

consequences of failing to act now to deal<br />

with projected climate impacts, there is<br />

a better chance of persuading portfolio<br />

managers to think for the long term – just<br />

as many investors already do.<br />




FINANCE:<br />



One long-standing blind spot has been<br />

the inability of financial decision-makers to<br />

see the materiality of environmental, social<br />

and governance factors, and price capital<br />

accordingly.<br />


Nick Robins, Co-Director, UN<br />

Environment Inquiry into the Design<br />

of a Sustainable Financial System<br />

A<br />

decade has passed since the onset<br />

of the financial crisis. Much has<br />

been done to fix the problems of<br />

the past; yet, according to UN Secretary-<br />

General Antonio Guterres, when set against<br />

the imperatives underlying the Sustainable<br />

Development Goals, “today’s global financial<br />

system, which manages some US$300<br />

trillion in financial assets on our collective<br />

behalf, is simply not fit for purpose.”<br />

One long-standing blind spot has been<br />

the inability of financial decision-makers<br />

to see the materiality of environmental,<br />

social and governance factors, and price<br />

capital accordingly. Endemic short-termism<br />

exacerbates the problem, producing what<br />

the Bank of England Governor Mark Carney<br />

described in 2015 as ‘the tragedy of horizons’.<br />

Now things are changing – and with<br />

unexpected speed. Old puzzles over whether<br />

integrating ESG into investments can result<br />

in a profit are now being answered – in<br />

the affirmative. According to the Financial<br />

Times, there is “mounting evidence that<br />

funds which observe ESG standards tend to<br />

outperform those that don’t by a significant<br />

margin.” Capital is also being reallocated<br />

at scale to the low-carbon growth sectors<br />

of the future. In the first half of <strong>2017</strong>, green<br />

bond issuance expanded by almost 50 per<br />

cent to reach US$56bn, and is on course for<br />

US$130bn for the full year, up from US$81bn<br />

in 2016. So far in <strong>2017</strong>, France, the USA and<br />

China have been the leading green bond<br />

issuing countries. COP23 President Fiji<br />

has just issued a sovereign green bond, a<br />

developing world first.<br />

More significant still is how environmental<br />

factors are becoming part of the wider<br />

architecture that governs the financial<br />

system. The Financial Stability Board –<br />

which was set up in the wake of the financial<br />

crisis – has now begun to confront the<br />

threat of climate change. Its Task Force on<br />

<strong>Climate</strong>-Related Financial Disclosures has<br />

presented an industry-led set of reporting<br />

recommendations that will drive the climate<br />

transition into both corporate planning<br />

and investment decisions. Importantly, this<br />

voluntary package is already being endorsed<br />

by leading insurance regulators, such as<br />

California, Brazil, France, the Netherlands,<br />

Singapore, South Africa and the UK, who<br />

realise that they also need better climate<br />

data to ensure that the companies they<br />

supervise are ‘safe and sound’.<br />

Perhaps the most striking example<br />

of this fusion of environmental threats<br />

with financial regulation comes from<br />

the European Union. In September <strong>2017</strong>,<br />

the European Commission decided that<br />

the European supervisory authorities for<br />

banking, securities markets and insurance<br />

should aim to ‘promote sustainable<br />

finance while ensuring financial stability’<br />

– something that would have been<br />

unthinkable just a year before.<br />

A number of factors explain this shift – not<br />

least the recognition that climate change<br />

wrecks our ability to deliver long-term<br />

returns for savers and investors. But this<br />

is not all about avoiding risk. Some of the<br />

world’s leading financial centres – including<br />

Casablanca, Hong Kong, London, Paris and<br />

Shanghai – are now starting to take action<br />

to seize the strategic opportunity presented<br />

by sustainable finance. Increasingly clean<br />

energy and electric vehicles are no longer<br />

‘mitigation’ measures to cut carbon pollution,<br />

but ways of rebooting the economy. To<br />

realise the potential, we need a financial<br />

system that makes the transition cheaper,<br />

faster and smoother.<br />

A key challenge is to translate climate<br />

goals – as expressed in the Nationally<br />

Determined Contributions (NDCs) – into<br />

clear rules, standards and incentives for<br />

banking, capital markets and insurance. A<br />

growing number of countries are putting in<br />

place sustainable finance roadmaps to do<br />

this, from China to Italy and on to Morocco.<br />

The European Union has also set up a highlevel<br />

expert group on sustainable finance<br />

to produce its own roadmap. Across the<br />

world, a pressing issue is how to deploy<br />

digital finance to deliver environmental and<br />

social benefits, for example, through mobile<br />

banking, peer to peer investments and big<br />

data analytics. Importantly, these roadmaps<br />

do not happen in isolation – and the value<br />

of international initiatives – such as G20’s<br />

green finance study group – is to share<br />

experience and drive emulation of good<br />

practice. According to the Green Finance<br />

Progress Report (<strong>2017</strong>), prepared for the G20<br />

by the UNEP Inquiry (http://unepinquiry.org),<br />

the past year has seen the introduction of<br />

the greatest number of financial policies and<br />

measures to promote green and sustainable<br />

finance.<br />

Making the bridge between sustainable<br />

finance and core economic goals is one sign<br />

of a new maturity. Designing sustainable<br />

finance so that it helps cut poverty and<br />

inequality is another, particularly in the<br />

developing world. We know from the past<br />

that mismanaged transitions can result in<br />

social dislocation. As we make the shift to a<br />

resilient zero carbon economy, the financial<br />

system needs to focus not just on avoiding<br />

‘stranded assets’ but also ‘stranded workers’<br />

and ‘stranded communities’. One way of<br />

doing this could be to develop ‘sustainable<br />

finance zones’ to connect the expertise and<br />

resources of the world’s financial centres<br />

with key areas of socio-economic need.<br />

In the current situation where demand for<br />

green assets is outstripping supply, these<br />

‘sustainable finance zones’ could help to<br />

build pipelines of bankable projects that<br />

hit climate goals and social objectives<br />

simultaneously.<br />

In the process, we will have gone some<br />

way to respond to Guterres’ challenge,<br />

and will have helped to create a financial<br />

system that is truly fit for sustainable<br />

development.<br />

In the first half of <strong>2017</strong>, green bond<br />

issuance expanded by almost 50 per<br />

cent to reach US$56bn.<br />

59<br />








Graeme Pitkethly, Unilever’s Chief<br />

Financial Officer and a Vice Chair of<br />

the Task Force on <strong>Climate</strong>-related<br />

Financial Disclosures (TCFD)<br />

Even today, as you read this, climate<br />

change is impacting businesses<br />

around the world. It disrupts supply,<br />

reduces crop yields, increases costs and<br />

prompts regulation. Recently, <strong>Climate</strong><br />

Wise calculated that the ‘protection gap’<br />

– that is, the uninsurable risk from climate<br />

change – has grown to US$100bn. And<br />

for businesses, today’s challenges pale in<br />

comparison to what could come tomorrow.<br />

Despite this, very few companies<br />

currently report climate change as a risk.<br />

According to KPMG, 72 per cent of large<br />

and mid-cap firms worldwide do not<br />

acknowledge the financial risks of climate<br />

change in their annual financial reports.<br />

I believe this will change. Why? Because<br />

the current situation can undermine<br />

both the stability of the global financial<br />

system and the ability of companies and<br />

investors to fully understand the risks and<br />

opportunities they face.<br />

60<br />

If markets are to operate efficiently<br />

they must be transparent, to help<br />

investors evaluate companies and<br />

make better decisions for the long<br />

term. Without transparency, investors<br />

in financial markets will lack clear<br />

information about which companies<br />

or assets are most exposed to climate<br />

change, and which are best prepared.<br />

Access to comparable reporting data<br />

promotes better pricing of climaterelated<br />

risks and opportunities. It also<br />

leads to more informed investment,<br />

credit and insurance underwriting<br />

decisions.<br />

Crucially, reporting climate change in<br />

financial filings encourages management<br />

teams and boards to properly assess the<br />

scenarios their companies face. After all,<br />

annual reports should always outline key<br />

risks to a business – and climate change<br />

is surely one of them. Those who invest<br />

time in this exercise will be rewarded<br />

by being better able to make decisions<br />

for the future of their businesses, and<br />

navigate the transition to a low-carbon<br />

economy. The opportunities alone are<br />

substantial. US$25 trillion of assets<br />

under management are participating in<br />

Investor Platforms on <strong>Climate</strong> Change.<br />

Add to that another US$23 trillion of<br />

investment opportunities in emerging<br />

markets as a result of COP21, according<br />

to the IFC.<br />

It is clearly in a company’s interests<br />

to disclose climate-related data. It<br />

is only a matter of time before most<br />

investors – as well as consumers,<br />

employees and governments – actively<br />

ask for this information. In many cases,<br />

this is already happening. We know,<br />

for example, that transparency is<br />

increasingly important to consumers,<br />

particularly millennials. They want to<br />

understand and trust the companies<br />

behind the brands they buy, and they<br />

want to know more about their purpose<br />

and values.

So the business case is evident. And<br />

thanks to the work of the Task Force on<br />

<strong>Climate</strong>-related Financial Disclosures<br />

(TCFD), convened by Bank of England<br />

Governor Mark Carney and chaired<br />

by Michael Bloomberg, we now have<br />

a clear framework to help companies<br />

consider and disclose climate changerelated<br />

financial factors. As part of<br />

the TCFD, we focused on developing<br />

recommendations for voluntary,<br />

consistent, financial reporting on climate<br />

change. Importantly, we designed them<br />

to be as practical as possible to adopt<br />

in mainstream financial filings, across<br />

sectors and geographies. Unilever was<br />

one of the first companies to commit to<br />

Access to comparable reporting<br />

data promotes better pricing of climaterelated<br />

risks and opportunities.<br />

implementing the recommendations. We<br />

are working towards their adoption and<br />

urge others to do the same.<br />

Of course, there are many other<br />

things that businesses can do to tackle<br />

climate change. For example, Unilever<br />

has reduced CO 2<br />

from energy in<br />

manufacturing by almost two-thirds over<br />

the past two decades and we have set a<br />

bold target of being carbon positive by<br />

2030, committed to sourcing 100 per cent<br />

of our energy from renewable sources.<br />

Not only is this the right thing to do, but<br />

it benefits our shareholders, with lower<br />

operational costs and greater resilience<br />

in our energy supply. By proactively<br />

cutting our greenhouse gas footprint, we<br />

also reduce our exposure to increasing<br />

environmental regulation and taxes.<br />

To tackle climate change we need<br />

continued leadership from governments,<br />

cities, regions and, of course, businesses<br />

to create a virtuous cycle of action and<br />

ambition. Most of all, climate change is<br />

no longer an environmental issue. It is<br />

a profound issue of economic transition<br />

and financial stability, as likely to be<br />

on a G7 or G20 agenda as any other<br />

geopolitical or macroeconomic concern.<br />

As world leaders come together in<br />

Canada and Argentina in <strong>2018</strong> to<br />

address concerns around the global<br />

economy, I hope that their endorsement<br />

of the Task Force’s recommendations sits<br />

high on their agenda.<br />








Remco Fischer,<br />

UNEP Finance Initiative (UNEP FI)<br />

62<br />

One of the great challenges of the<br />

next few decades will be to make<br />

economic growth and social<br />

development – and thus human welfare –<br />

compatible with the stability and health of<br />

the world we live in – or even conducive to<br />

it. Achieving that requires nothing short of<br />

greening capitalism: putting the marketdriven<br />

energy, innovation and motivation,<br />

which over the last centuries have forged<br />

modern economies and raised hundreds<br />

of millions out of poverty, at the service<br />

of protecting the global commons. In that<br />

ambitious context, the Financial Stability<br />

Board’s (FSB) Task Force on <strong>Climate</strong>-<br />

Related Financial Disclosures (TCFD)<br />

and the recent publication of its Final<br />

Recommendations Report now mark a<br />

real and significant milestone of progress<br />

(www.fsb.org).<br />

The disclosure framework that the TCFD<br />

provides, and the political impetus with<br />

which it is provided, have the potential<br />

to give an unprecedented boost to the<br />

systematic integration of climate factors<br />

into economic and financial decisionmaking.<br />

They will boost the seriousness<br />

with which investors and other<br />

stakeholders consider the future viability<br />

of business in their decision-making. They<br />

will, of course, need to take into account<br />

that tomorrow’s technology policy will be<br />

radically diff erent from today’s as a result<br />

of climate change.<br />

Specifically, there are three core features<br />

in the TCFD Framework that make it stand<br />

out, and mark a new stage in the journey to<br />

full disclosure of climate and environmental,<br />

social and governance issues.<br />

Firstly, it is true – as stated by<br />

Mark Carney, Governor of the Bank<br />

of England and FSB Chair – that the<br />

recommendations were developed by<br />

the market, and for the market. It is also<br />

true that the TCFD’s work has been<br />

undertaken explicitly under the auspices<br />

of the financial regulatory community. This<br />

is the first time that international financial

that they need it. As a result, the overall<br />

disclosure practice by companies and the<br />

ensuing availability of corporate data will<br />

be improved.<br />

Thirdly, meaningful assessments of the<br />

financial risks and opportunities of climate<br />

change can only be achieved in a forwardlooking<br />

way, given how climate change<br />

and its impacts are not static – quite the<br />

contrary. Currently, for instance, we are<br />

experiencing a world that is roughly 1˚C<br />

warmer than in pre-industrial times. This<br />

is characterised by still growing global<br />

emissions, and a still fairly tepid global<br />

landscape of public decarbonisation<br />

targets and policies. By extension, the<br />

financial risks and opportunities from<br />

critical, and so promising in advancing<br />

the robustness, ‘scrutinisability’ and<br />

credibility of climate-related corporate<br />

and investor disclosures.<br />

In the same way as the TCFD framework<br />

and the above features are necessary and<br />

promising, so will be their implementation<br />

by practitioners in the real world be<br />

ridden with complexity. This particularly<br />

applies to financial institutions. The<br />

development of scenarios able to capture<br />

relevant parameters, across technological,<br />

policy and physical domains, and the<br />

modelling of likely business outcomes<br />

under various scenarios, will be complex<br />

for companies in the real economy.<br />

For financial institutions, however, the<br />


This is the first time that<br />

international financial regulators<br />

are taking a stance, mandating and<br />

endorsing work on the financial<br />

repercussions of an environmental<br />

issue.<br />

regulators are taking a stance, mandating<br />

and endorsing work on the financial<br />

repercussions of an environmental issue.<br />

There is no need to explain what this<br />

new political impetus means for the<br />

seriousness and determination with which<br />

financial market actors are now likely<br />

to approach the challenge of managing<br />

climate-related risks.<br />

Secondly, banks, insurers and investors<br />

are themselves now considered to be<br />

not only recipients of disclosures from<br />

others, but also preparers of disclosures<br />

themselves, to their own stakeholders.<br />

Clearly, if investors are now expected<br />

to provide transparency on the climaterelated<br />

risks and opportunities that they<br />

face, and be scrutinised accordingly,<br />

they will take the climate disclosure<br />

challenge far more seriously than before.<br />

This implies that in the future they will be<br />

more determined in obtaining climaterelated<br />

data from companies in their<br />

portfolios – in the formats and the quality<br />

climate change do currently exist but are<br />

limited. And so, if asked for corresponding<br />

assessments, most actors would<br />

accurately convey just that. The point,<br />

however, is that current circumstances<br />

are unstable and highly likely to change<br />

radically in the coming years and decades.<br />

If world leaders fail to increase their<br />

decarbonisation ambition and eff orts,<br />

the additional warming by 2, 3 or more<br />

degrees would intensify the physical risks<br />

to unprecedented, economically disruptive<br />

levels, while keeping transition risks at<br />

bay; if, on the other side of the spectrum,<br />

leaders did take determined action to<br />

mitigate climate change, the transition<br />

risks would be significant while the more<br />

dangerous physical risks would remain<br />

manageable. So, no matter what, the<br />

climate-impacted future will be diff erent<br />

than the present.<br />

That is why the strong emphasis in<br />

the TCFD framework on forward-looking,<br />

scenario-based assessments is so<br />

exercise becomes daunting, since their<br />

climate exposures are manifested in large<br />

portfolios comprising at times innumerable<br />

positions across virtually all sectors of the<br />

economy.<br />

It is the combination of a challenging<br />

task ahead and a new determination<br />

among leading financial actors to<br />

tackle it that has allowed us as UNEP<br />

FI to convene 17 leading banks from 10<br />

countries in diff erent parts of the world<br />

to collaboratively work towards a first set<br />

of TCFD-compliant disclosures. Through<br />

this working group of industry pioneers<br />

we hope to cut through the complexities<br />

at hand and to ultimately off er climate<br />

disclosure guidance to the banking<br />

industry at large. If a critical mass of banks<br />

then follows and becomes systematic in its<br />

appraisal, disclosure of, and response to,<br />

climate-related risks and opportunities, we<br />

might have moved the dial a little bit in the<br />

ability of financial markets to become a<br />

leading force in greening capitalism.<br />






Richard Zechter, Adviser - <strong>Climate</strong><br />

Finance, <strong>Climate</strong> Change Group at<br />

the World Bank<br />

As we respond to the huge policy<br />

challenge of climate change, it is<br />

clear that carbon pricing plays a<br />

crucial role. In particular, it requires the<br />

cost of greenhouse gas emissions to be<br />

considered in financial decisions. This<br />

levels the playing field between emissionintensive<br />

and low-carbon economic<br />

activities, triggering more investments in<br />

low-carbon technologies.<br />

In the <strong>2017</strong> State and Trends of Carbon<br />

Pricing edition (forthcoming from World<br />

Bank Open Knowledge Repository), we find<br />

that carbon pricing initiatives are continuing<br />

to spread. Significant progress has been<br />

made over the past two years, including the<br />

64<br />

entry into force of the Paris Agreement and<br />

the eight new carbon pricing initiatives that<br />

have been implemented in national and<br />

subnational jurisdictions. When the Chinese<br />

national emissions trading system (ETS) is<br />

launched – planned for the end of <strong>2017</strong> – it<br />

will be the largest carbon pricing initiative<br />

in the world. Developments in the Americas<br />

have been particularly prominent, with six<br />

new carbon pricing initiatives implemented<br />

in this region since the beginning of 2016.<br />

But more progress is needed to reach the<br />

goal of the Paris Agreement: the coverage<br />

of GHG emissions must expand, deeper<br />

impacts on emission reductions need<br />

to be triggered by raising carbon prices,<br />

and the speed of these actions should<br />

accelerate. The current level of carbon<br />

prices is significantly lower than the level<br />

that the High-Level Commission on Carbon<br />

Prices found to be consistent with the<br />

temperature goal of the Paris Agreement.<br />

While 15 per cent of global GHG emissions<br />

are currently covered by an ETS or carbon<br />

tax, a much higher coverage combined<br />

with international cooperation on climate<br />

markets is essential to mobilise the large<br />

volume of resources for a decarbonised<br />

economy and to bring down the costs of<br />

low-carbon technology.<br />

The potential role for international market<br />

mechanisms in reducing the cost of climate<br />

change mitigation is crucial. Modelling<br />

analysis undertaken in the 2016 State and<br />

Trends of Carbon Pricing report has shown<br />

that an international carbon market could<br />

reduce the cost of delivering the emission<br />

reductions identified in the current Nationally<br />

Determined Contributions (NDCs) by<br />

about a third by 2030. Negotiations are<br />

now under way to develop the guidelines<br />

Credit: Jutta Benzenberg, World Bank

to implement the Paris Agreement, with<br />

country-level pledges to reduce GHG<br />

emissions formalised through NDCs. Carbon<br />

pricing plays a prominent role in many<br />

of these NDCs, with 81 parties currently<br />

planning or considering its use. Among<br />

other functions, the Paris guidelines will<br />

govern the operationalisation of cooperative<br />

approaches to emissions mitigation under<br />

Article 6, thereby shaping the way forward<br />

for international market mechanisms and the<br />

linking of domestic carbon pricing initiatives<br />

under the new international climate accord.<br />

In our report we also explore how the two<br />

main modalities of international cooperation<br />

– climate finance and climate markets – can<br />

be used in an integrated approach to enable,<br />

support and complement domestic policies<br />

to stimulate the flow of resources. We focus<br />

on the role that results-based climate finance<br />

The potential role for<br />

international market mechanisms in<br />

reducing the cost of climate change<br />

mitigation is crucial.<br />

can play in piloting cooperative approaches<br />

under Article 6 to help provide lessons for<br />

the implementation of international market<br />

mechanisms.<br />

Without urgent action, climate<br />

impacts could push an additional 100<br />

million people into poverty by 2030. The<br />

fundamental challenge is how to build a<br />

sustainable global economy, where climate<br />

change and other environmental threats<br />

are met, while pursuing shared prosperity.<br />

To succeed in tackling climate change we<br />

must succeed at mobilising the required<br />

investments, involving trillions of dollars<br />

annually. An integrated policy response<br />

will be needed that combines the full<br />

range of climate change mitigation polices,<br />

including domestic carbon prices, other<br />

domestic policies, climate finance and<br />

international market approaches.<br />


We need to shift planned investments to<br />

low carbon alternatives<br />

and mobilise incremental<br />

low-carbon investments<br />

of $700 billion*<br />

annually by<br />

2030 to transition to a<br />

low-carbon economy.<br />

The $700 billion estimate is based on studies by<br />

the IEA & IRENA, McCallum et al, and the World<br />

Economic Forum, et al.<br />



8th Annual<br />

Environment Ministers,<br />

CEOs, and Mayors are<br />

attending the 8th<br />

Sustainable Innovation Forum<br />

<strong>Climate</strong> <strong>Action</strong>, in partnership with UN Environment, is hosting the largest<br />

business-focused event taking place during COP23.<br />

The 8th Sustainable Innovation Forum is bringing together over 600 delegates<br />

and 75+ world-class speakers for two days of sharing ideas, networking,<br />

collaboration and deal making that will fast track the green economy.<br />

The Forum provides a world class line-up of keynote speakers, panel<br />

discussions, networking sessions, on-stage interviews, innovation spotlights,<br />

Mayors’ breakfast briefings, and much more.<br />

Hear from global sustainability leaders on the latest developments in clean<br />

energy, decarbonising transport, sustainable cities, the circular economy,<br />

climate finance and more.<br />

Speaker highlights include:<br />

• Jerry Brown, Governor of California and Special Envoy for States and<br />

Regions<br />

• Erik Solheim, Executive Director, UN Environment<br />

• Environment and Energy Ministers from around the world, including:<br />

Denmark, Poland, Ecuador, Norway, UAE, the Maldives, Luxembourg,<br />

Estonia, Ethiopia, and more.<br />

There will also be an exclusive Mayor’s ‘BreatheLife Cities Roundtable’, in<br />

collaboration with ICLEI and UN Environment. This breakfast event aims<br />

to mobilise cities and individuals to protect our health and planet from the<br />

effects of air pollution.<br />

Delegates are representing national and regional governments, the private<br />

sector, the UN, NGOs, academia, responsible investors, development banks,<br />

sustainability entrepreneurs and more.<br />

The Forum is taking place at the heart of COP23 and the negotiations –<br />

conveniently located steps away from the ‘Bula Zone’, at the<br />

<strong>Climate</strong> <strong>Action</strong> Domes.<br />


67<br />









Patrick Child, Deputy Director-<br />

General – DG Research & Innovation,<br />

European Commission, and Mission<br />

Innovation Steering Committee Chair<br />

Remarkable strides have been<br />

made over recent years in driving<br />

down the costs of clean energy<br />

technologies. From onshore wind power<br />

to solar energy, from electric car batteries<br />

to LED lighting, costs have plunged<br />

dramatically across the board. These<br />

successes are testament to the power of<br />

innovation. By coupling sustained public<br />

investment in research and development<br />

with business leadership, fledgling ideas<br />

are brought into the mainstream. Despite<br />

these successes, many promising clean<br />

energy solutions are not yet market-ready<br />

and capable of competing with fossilfuel-based<br />

energy. In brief, the pace of<br />

innovation falls significantly short from what<br />

is required, considering the scale of energy<br />

system transformation needed.<br />

Mission Innovation aims to reinvigorate<br />

global efforts in this regard. Launched at<br />

COP21 in Paris in November 2015, it is a<br />

global initiative of 22 countries and the<br />

European Commission (acting on behalf<br />

of its member states). Member countries<br />

collectively account for more than 80 per<br />

cent of the world’s total public financing of<br />

clean energy research and development.<br />

By joining Mission Innovation, member<br />

countries recognise a critical reality:<br />


we need to accelerate the development<br />

of clean energy solutions to match the<br />

urgency of tackling climate change. Quite<br />

simply, for fossil fuels to remain in the<br />

ground, we need to accelerate to the point<br />

where clean energy is cheaper than coal,<br />

gas or oil.<br />

Each Mission Innovation member<br />

determines the means for advancing<br />

the common goals and pursues them<br />

independently. But since the inaugural<br />

ministerial meeting in June 2016 (MI-1),<br />

countries have clearly established dynamic<br />

cooperation in a spirit of joint ambition.<br />

Beyond the quantitative goal to double<br />

clean energy R&I investments, we have<br />

launched a number of initiatives to boost<br />

the impact of these investments. This<br />

includes the setting-up of collaborative<br />

networks and partnerships around clean<br />

energy innovation.<br />

One of the most exciting projects<br />

launched over the last year is the so-called<br />

Innovation Challenges. These are global<br />

calls to action aimed at accelerating<br />

research, development and demonstration<br />

Mission Innovation members share<br />

common goals and seek to double<br />

public clean energy research and<br />

development investment over<br />

five years, to develop and scaleup<br />

breakthrough clean energy<br />

technologies and to achieve substantial<br />

cost reductions in the process.<br />

(RD&D) in technology areas where<br />

Mission Innovation members believe<br />

increased international attention would<br />

make a significant impact in our shared<br />

fight against climate change. The seven<br />

Innovation Challenges are ambitious. They<br />

will stretch the boundaries of clean energy<br />

scientific know-how and include goals<br />

such as creating intelligent electricity grids<br />

and generating storable solar fuel from<br />

sunlight. They cover the entire spectrum<br />

of RD&D, from early stage research needs<br />




Bill Gates of the Breakthrough Energy Coalition and Carlos Moedas,<br />

European Commissioner for Research Science & Innovation<br />

Credit: IISD/Francis Dejon (enb.iisd.org/energy/mi/2016/1jun.html)<br />

assessments to technology demonstration<br />

projects. They aim to encourage increased<br />

engagement from the global research<br />

community and provide opportunities for<br />

new collaborations between participating<br />

countries and investment prospects for the<br />

private sector.<br />

Although much progress has been<br />

made, the global clean energy economy<br />

is still in the early stages of a multibillion<br />

dollar shift. Mission Innovation<br />

and the clean energy transition provide<br />

a compelling opportunity for investors,<br />

as can be seen by initiatives such as Bill<br />

Gates’ Breakthrough Energy Coalition.<br />

We know from past experience (in areas<br />

such as space, technology and medical<br />

research) that public investment in<br />

research leads to creation of businesses<br />

driven by private capital. Through<br />

Mission Innovation, we have political<br />

momentum. With the skills, resources,<br />

experience and vision of leading<br />

investors and industry, together we can<br />

take clean energy innovation from the<br />

laboratory to the market place.<br />

At its second Ministerial meeting<br />

(MI-2) in Beijing in June <strong>2017</strong>, Mission<br />

Innovation joined forces with the World<br />

Economic Forum. This new collaboration<br />

facilitates engagement between Mission<br />

Innovation activities and World Economic<br />

The seven Innovation Challenges<br />

will stretch the boundaries of clean<br />

energy scientific know-how.<br />

Forum members and partners. At the<br />

outset, attention is focused on selected<br />

Innovation Challenges – areas that are<br />

most promising for greater public–private<br />

cooperation to help develop and unleash<br />

new technologies into the market.<br />

The European Commission (EC)<br />

currently chairs the Mission Innovation<br />

Steering Committee, a position it will<br />

hold up to the 3rd Ministerial meeting<br />

(MI-3), which is to be co-hosted by<br />

the EC, Denmark, Finland, Norway and<br />

Sweden in <strong>2018</strong>. Taking place in Malmö<br />

and Copenhagen on 23-24 May, the<br />

meeting aims to build on the political<br />

momentum generated at MI-2 in China.<br />

Private sector engagement in clean<br />

energy innovation will be a key theme<br />

of MI-3. By bringing Ministers from all<br />

Mission Innovation countries to the table<br />

alongside leading clean energy investors<br />

and captains of industry, we will be able<br />

to leverage the high-level political will<br />

and private sector leadership needed to<br />

drive ambitious, real-world clean energy<br />

policies and actions.<br />







Anabel Gonzalez, Senior Director,<br />

Trade and Competitiveness Global<br />

Practice, World Bank Group<br />

The world is undergoing a clean<br />

technology revolution, and small<br />

and medium enterprises (SMEs) in<br />

developing countries will play a crucial<br />

role, transforming technology advances<br />

in climate sectors into commercial<br />

applications for local markets. The<br />

World Bank Group (www.worldbank.<br />

org) and others are supporting SMEs<br />

in this important work with financing,<br />

proper regulatory environments, technical<br />

assistance, and international cooperation.<br />

As climate SMEs scale and deploy new<br />

innovations, developing countries will not<br />

only increase their climate resilience and<br />

economic eff iciency, but also enhance<br />

national competitiveness with job<br />

creation and investment in many of the<br />

most dynamic sectors of the 21st century.<br />

Investment needs in green sectors for<br />

developing countries will be immense,<br />

with huge opportunities for local firms.<br />

The International Finance Corporation,<br />

a member of the World Bank Group, has<br />

estimated that US$23 trillion in climatesmart<br />

investment opportunities exist in<br />

selected emerging markets, and a World<br />

Bank report, Building Competitive Green<br />

Industries, showed that up to 25 per cent<br />

of climate investments in developing<br />

countries are available for local<br />

SMEs. Advances in renewable energy,<br />

efficiency, climate-smart agriculture<br />

and clean water create opportunities<br />

for companies to address development<br />

challenges with cleaner, more climatefriendly<br />

technologies and practices.<br />

Local SMEs play an essential role<br />

in scaling climate innovations for<br />

developing countries, and more needs<br />

to be done to support them. SMEs are<br />

a crucial ingredient for commercial<br />

innovation, but they face barriers in<br />

developing countries that are particularly<br />

acute in climate sectors. For example,<br />

many climate technologies have<br />

Jonathan Coony,<br />

Global Lead, Green Competitiveness,<br />

World Bank Group<br />

Table 1. What makes green sectors different?<br />

Need of last mile delivery<br />

Green enterprises deliver physical<br />

products to market<br />

Capital intensive<br />

Green enterprises have high upfront<br />

capital needs<br />

High dependency on policy support<br />

Green enterprises are highly dependent<br />

on regulatory regimes and the public<br />

sector more generally<br />

Green enterprises take longer to<br />

reach profitability<br />

Green enterprises, on average, have<br />

longer “gestation” periods before they<br />

reach profitability and the steep part of<br />

the enterprise growth curve<br />

Source: Innovations for Scaling Green Sectors report, infoDev, <strong>2017</strong><br />


Credit: Safi Organics<br />


Workers at Safi Organics in Kenya use biochar made from<br />

agricultural waste to make a soil conditioner<br />

capital-intensive hardware that requires<br />

extensive physical testing before launch.<br />

In addition, to account for their positive<br />

externalities, climate technologies can<br />

be heavily dependent on policy support<br />

whose variability can impede steady<br />

company growth. Table 1 summarises<br />

these barriers.<br />

When SMEs do not play an active role<br />

in commercialising new climate-related<br />

products and services for their countries,<br />

successful climate innovation lags. No<br />

one understands local market conditions<br />

better than local companies, and without<br />

the application of this knowledge poor<br />

technology choices will be made and<br />

scaling will be hindered. SMEs are<br />

essential to identify and adapt relevant<br />

technology advances with innovation in<br />

locally relevant business models that put<br />

those advances to use.<br />

Fortunately, a number of models<br />

are emerging to address the barriers<br />

SMEs face, so that local firms grow in<br />

rapidly expanding climate sectors. The<br />

World Bank recently released a report,<br />

Innovations for Scaling Green Sectors,<br />

that analysed the success and failure<br />

of SMEs to scale climate innovations in<br />

developing country markets. It proposed<br />

a framework of how these companies<br />

Local SMEs play an essential<br />

role in scaling climate innovations for<br />

developing countries, and more needs<br />

to be done to support them.<br />

can be supported, as shown in Table 2.<br />

The World Bank Group is putting<br />

these principles into action with its<br />

infoDev <strong>Climate</strong> Technology Program<br />

(CTP), supported by the governments<br />

of the United Kingdom, Denmark, the<br />

Netherlands, Australia and Norway. The<br />

CTP has launched a network of <strong>Climate</strong><br />

Innovation Centers in seven developing<br />

countries that directly support climate<br />

SMEs to commercialise and scale their<br />

innovations. A second generation of<br />

<strong>Climate</strong> Innovation Centers is under<br />

development.<br />

At COP22 in Marrakech, the World Bank<br />

expanded its work in this area with the<br />

launch of the <strong>Climate</strong> Business Innovation<br />

Network (CBIN), in partnership with the<br />

Moroccan government. The CBIN crowds<br />

in a range of local and global stakeholders<br />

from the public and private sector to bring<br />

comprehensive support to the entire<br />

innovation ecosystem for climate sectors<br />

in developing countries, with particular<br />

focus on local SMEs.<br />

Many companies supported by the<br />

CTP are already making a difference in<br />

the climate sectors of their countries. In<br />

Ghana, Gloria Asarea Adu and Marigold<br />

Adu lead Global Bamboo, a company<br />

selling briquettes from bamboo that<br />

preserve forests, reduce emissions and<br />

decrease health risks by reducing smoke.<br />

In Morocco, another CTP-supported<br />

company, eLum, is using innovative<br />

artificial intelligence software to optimise<br />

energy management between solar<br />

panels, battery systems and the grid<br />

to reduce both electricity bills and<br />

emissions. And in Kenya, Safi Organics<br />


Table 2. Opportunities and innovations for scaling green sectors<br />

Opportunity<br />

Business model<br />

innovations<br />

Examples<br />

• Mobile-enabled PAYGO financing mechanism has fostered the development of green subsectors such as<br />

SHS.<br />

• Bundled service combines related product offerings and builds forward and backward integration for<br />

products and services to offer packages of solutions.<br />

• Credit history facilitation for low-income customers through initial sales and monthly payment history<br />

allows customers to upgrade and access credit for other purposes and from other finance providers.<br />


Enabling<br />

technology<br />

platforms<br />

Market creation<br />

and de-risking<br />

mechanisms<br />

Speciality<br />

financing<br />

instruments for<br />

green businesses<br />

Technology and<br />

business model<br />

transfer<br />

Strategic<br />

partnerships<br />

• Technology that allows for rapid credit appraisal of potential low-income consumers is being piloted.<br />

• Technology platforms / MNOs that enable payments and collections (such as Safaricom’s M-PESA for<br />

payments).<br />

• Technology platforms / MNOs that enable payments and collections (such as Safaricom’s M-PESA for<br />

payments).<br />

• Convergence and combination of multiple technology-backed services has enabled an overall drop in<br />

costs such as smart meters, mobile money and low-cost solar for SHS.<br />

• Quality certification programmes that establish quality standards and best practices provide clarity in the<br />

marketplace for consumers and ensure that poor quality products do not spoil the market for green products.<br />

• Trade and industry associations can provide services such as policy development and analysis, training,<br />

codes of practice, industry promotion, networking, conferences and industry updates.<br />

• Development of robust data metrics that allow investors interested in green enterprises to measure the<br />

economic, social, and environmental performance of their investment are important tools to drive sector<br />

development.<br />

• Speciality financing mechanisms that invest in early stage green enterprises such as World Bank<br />

Group’s climate venture facilities (CVFs), growth stage low-cost debt and working capital facilities, and<br />

instruments that provide mitigation of local currency and interest rate risk for green enterprises, can drive<br />

green subsectors.<br />

• Specific efforts to transfer technology or business models from one country to another can potentially<br />

enable scale.<br />

• Matchmaking of foreign businesses or technology with local businesses is being piloted to help<br />

successful green businesses and business models to scale out.<br />

• Choosing the business partner and area of collaboration has enabled many green enterprises to<br />

operationally scale their businesses both in their home countries and expand outside to cover a larger<br />

customer base.<br />

• Partnerships for building customer awareness and for customer financing help green businesses in<br />

market building and reaching potential customers.<br />

Source: Innovations for Scaling Green Sectors report, infoDev, <strong>2017</strong><br />

promotes climate-smart agriculture by<br />

converting agricultural waste into carbonnegative<br />

soil conditioner. The company<br />

founder, Samuel Rigu, has already<br />

expanded production capacity from five<br />

to 25 tons per month and has a vision<br />

for Safi Organics to grow to the point of<br />

reaching 38 million farmers across Africa.<br />

In these and many other cases,<br />

companies are helping their countries<br />

respond to climate challenges with a<br />

pro-growth approach. Without these<br />

SMEs, the new clean technology<br />

advances being seen around the<br />

world would not be adapted to local<br />

circumstances for deployment and<br />

scale-up.<br />

However, more still needs to be done<br />

to build on these successes. We need<br />

to strengthen the crucial link that local<br />

SMEs represent in scaling the innovations<br />

essential for developing countries to<br />

address climate change. The historic shift<br />

to greener and cleaner economies is<br />

proceeding apace at the global level, but<br />

we must ensure that developing countries<br />

take part in this process.<br />

The World Bank Group is eager to<br />

partner with others to expand the work<br />

that makes local SMEs a key player in<br />

this transformation. In doing so, we can<br />

bring the clean technology revolution<br />

to developing countries so they can not<br />

only address climate threats but also<br />

drive growth through job creation and<br />

investment in highly dynamic markets.<br />








Dr Roland Busch, Chief Technology<br />

Officer and Member of the Managing<br />

Board of Siemens AG<br />

Follow me on Twitter @BuschRo<br />

74<br />

On sunny days some residents in<br />

Brooklyn generate more electricity<br />

from the solar panels on their roofs<br />

than they can consume. Fortunately as<br />

members of the Brooklyn Micogrid project,<br />

they can trade this electricity with their<br />

neighbours on a blockchain platform. While<br />

helping to reduce their community’s carbon<br />

emissions, these residents also benefit<br />

through lower energy bills. And with plans<br />

to install battery storage, should a big storm<br />

hit, this Brooklyn community won’t be left<br />

in the dark.<br />

Every time a severe storm strikes,<br />

the issue of climate changes raises its<br />

head. There is a growing acceptance<br />

that the effects of climate change<br />

are happening now and not in some<br />

distant future. This year alone several<br />

extreme weather events have damaged<br />

infrastructure, caused economic losses<br />

and put lives at risk. Business as usual is<br />

no longer an option. Like the residents of<br />

Brooklyn, governments, companies and<br />

communities need to act.<br />

Digitalisation can make the energy<br />

transition happen<br />

If we want to limit global warming to 2°C<br />

as outlined in the Paris Agreement, then<br />

renewable sources will have to play a<br />

bigger role in meeting energy needs. The<br />

progress made is encouraging. Who would<br />

have thought 10 years ago that renewables<br />

would be as competitive as fossil fuels, not<br />

to mention the positive effect on job creation.<br />

Given the scale and their intermittent nature,<br />

digital technologies will be a key enabler to<br />

increasing the share of renewable energy<br />

generation. Innovative technologies are<br />

already available today for grid integration,<br />

stability, demand management and storage.<br />

Governments will need to bring forward<br />

policies for electricity markets and carbon<br />

pricing to foster long-term investment.<br />

Switching to electric power also offers<br />

enormous potential to decarbonise our<br />

economy, from heating for buildings,<br />

to power for industrial processes and<br />

transportation. Public transport in many<br />

cities, such as metros and trams, already<br />

operate as electrified systems. While<br />

road transport is still heavily reliant on<br />

combustion engines, several automotive<br />

companies recently committed to<br />

producing more hybrid and electric<br />

vehicles. Meanwhile Siemens has been<br />

working on an innovative solution to<br />

electrify freight transport, known as<br />

eHighway, with demonstration projects<br />

in Germany, Sweden and California.<br />

Energy efficiency measures, like building

Brooklyn Microgrid participants can sell excess solar power to their neighbours on the TransActive<br />

Grid blockchain platform from LO3 Energy. Siemens provides microgrid control solutions.<br />


Copyright LO3 Energy<br />

automation systems or energy monitoring<br />

are compelling ways to reduce energy<br />

consumption and thereby emissions,<br />

through their cost saving benefits.<br />

Cutting carbon through<br />

connected cities<br />

Responsible for 80 per cent of CO2<br />

emissions, cities have a fundamental role to<br />

play. The first step in tackling emissions is to<br />

have a clear strategy. The City Performance<br />

Tool (CyPT), developed by Siemens,<br />

assesses the impact of technologies in<br />

the building, energy, and transport sectors<br />

on GHG emissions and air pollutants, and<br />

the CAPEX and OPEX required. Many<br />

cities have used the CyPT tool to design<br />

strategies to reduce emissions and found<br />

that investing in green technologies also<br />

creates job opportunities.<br />

Integrating distributed renewable<br />

energy sources, like the Brooklyn<br />

Microgrid, is an effective way to cut<br />

emissions, boost resilience and meet<br />

energy demands. The IEA estimates that<br />

by 2050, rooftop solar panels could supply<br />

almost one third of a city’s energy needs.<br />

Copyright: Siemens Press<br />

In 2015, Siemens pledged to<br />

become the world’s first major carbonneutral<br />

industrial enterprise by 2030.<br />

As previously mentioned, electrified<br />

transport can significantly cut emissions.<br />

But the bigger opportunity comes from<br />

using IoT technologies to integrate sectors.<br />

Connected buildings and electric vehicles<br />

can interact with power grids to consume,<br />

store or supply electricity as required.<br />

Integrated transport systems combined<br />

with innovative mobility services can<br />

encourage uptake of public transport.<br />

Open IoT operating systems, like<br />

MindSphere can help cities to take<br />

advantage of these opportunities by<br />

securely connecting their infrastructure to<br />

the cloud and leverage their data.<br />

Data insights coupled with the ability of<br />

systems to speak to each other can help<br />

The eHighway is an innovative solution<br />

for electrified road freight transport.<br />

cities tackle issues like congestion and<br />

air pollution and to better manage energy,<br />

water and other services in innovative<br />

ways. Singapore, for example will be<br />

piloting MindSphere to become a fully<br />

integrated urban ecosystem.<br />

The business case for climate action<br />

More and more companies are taking<br />

action to green their footprint and enjoying<br />

the benefits, such as lower costs through<br />

energy efficiency measures, as well as new<br />

business opportunities. In 2015, Siemens<br />

pledged to become the world’s first major<br />

carbon-neutral industrial enterprise by 2030.<br />

The business case is clear: out of the €100<br />

million investments in energy-efficiency<br />

technologies, we expect annual savings of at<br />

least €20 million. Our environmental portfolio<br />

helped customers and partners reduce their<br />

CO2 emissions by 521 million metric tons.<br />

That’s around ten times New York’s annual<br />

carbon-dioxide output. And it generated<br />

revenues of €36 billion in 2016.<br />

While governments have an important<br />

role to play by establishing the requisite<br />

frameworks and policies; businesses,<br />

communities and cities cannot afford to<br />

delay action. Our vulnerability to climate<br />

change can carry a very high price tag.<br />

Whereas investing in green technologies<br />

can create jobs, lower costs and improve<br />

quality of life. So what are we waiting for?<br />


© Jean Revillard / Rezo.ch<br />


Existing clean technologies and<br />

processes are profitable and could<br />

divide by two the energy consumption<br />

of the world and therefore the CO 2<br />

emissions.<br />


1000<br />




TO SOLVE<br />


CHANGE<br />

Dr Bertrand Piccard, Psychiatrist and<br />

Explorer, Initiator and Chairman of<br />

the Solar Impulse Foundation<br />

When I was flying with my solar<br />

plane over the Atlantic Ocean,<br />

I remember looking at the sun<br />

that was giving energy to my four electric<br />

motors and their huge propellers. There<br />

was no noise, no pollution, no fuel… and I<br />

could fly for ever. At one moment I thought,<br />

“This is science fiction, I’m in the future.”<br />

And then I realised, “No, it’s completely<br />

wrong, I’m in the present. This is what the<br />

technologies of today already allow me to<br />

do. It’s the rest of the world that is in the<br />

past, with old and ineff icient devices.”<br />

A rough estimation shows that existing<br />

clean technologies and processes could<br />

divide by two the energy consumption<br />

of the world and therefore the CO 2<br />

emissions, if only they were implemented.<br />

Thousands of them are available<br />

everywhere, for everyone to use, but<br />

who knows about them? They are often<br />

hidden in start-ups or research labs. So<br />

few people realise how profitable, for<br />

both the industry and the planet, they<br />

have become! They create jobs, generate<br />

profit and boost economic growth.<br />

I have always said that protection of the<br />

environment would become a reality only<br />

if it requires no financial or behavioural<br />

sacrifices. Who would renounce driving<br />

their car or heating their house because<br />

of sea levels rising in 20 years’ time? The<br />

truth is that today, even if climate change<br />

didn’t exist, building clean and eff icient<br />

infrastructures would make sense. They<br />

represent the greatest industrial market<br />

ever, with the introduction of electric<br />

mobility, fully insulated constructions,<br />

heat pumps and LED lighting, smart grids<br />

and modern industrial processes. And<br />


© Jean Revillard / Rezo.ch<br />


for the protectors of the environment, a<br />

clean growth is certainly better than the<br />

dirty status quo we have today. That’s a<br />

win-win situation.<br />

An encouraging sign of this is the rapid<br />

expansion of the green bond market,<br />

which doubled to almost US$83 billion<br />

after the signature of the 2015 <strong>Climate</strong><br />

Agreement. Investors are beginning<br />

to take into account the threats – slow<br />

growth trap, low interest rates – of being<br />

addicted to fossil fuels. Investing in these<br />

new solutions is the next driver of real<br />

economic development.<br />

But to reach the objectives set in Paris and<br />

keep global warming below the 2 degree<br />

mark, public and private sector investment<br />

in clean energy needs to reach at least US$1<br />

trillion per year by 2030, starting now, as<br />

shown in the New <strong>Climate</strong> Economy 2015<br />

report. Although US$1 trillion per year might<br />

seem a huge amount, we need to consider<br />

this a profitable investment rather than an<br />

expensive cost. So the more we invest, the<br />

more we will earn.<br />

Yet, we keep setting goals and objectives<br />

for 2050, 2040, 2030 at best. I hate this,<br />

because it is too far away – no one feels<br />

accountable or responsible for such a distant<br />

target! Decision-makers need to focus<br />

on solutions and shorter-term achievable<br />

goals as part of their roadmaps for action.<br />

An ambitious legal framework would pull<br />

innovative products to the market instead of<br />

leaving everybody in uncertainty.<br />

78<br />

Last year Solar Impulse completed<br />

the first solar flight around the world,<br />

demonstrating that clean technologies<br />

can make a plane fly perpetually with no<br />

fuel. Today the second part of my vision<br />

has started: selecting 1000 profitable<br />

solutions to protect the environment by<br />

COP24. I will then personally go around<br />

the world again, to deliver those same<br />

solutions to governments, companies<br />

and institutions, and we shall of course<br />

also make them available for everyone to<br />

access and use.<br />

Things have been rapidly falling<br />

into place. Several partners have<br />

extended their support to the Solar<br />

Impulse Foundation (www.solarimpulse.<br />

com) to create the World Alliance for<br />

Efficient Solutions. We have entered into<br />

close collaboration with a number of<br />

international institutions, states as well<br />

as cities over the world. We have already<br />

gathered more than 500 members<br />

bringing solutions that are designed to<br />

be both profitable and environmentally<br />

friendly. In parallel, we are growing a<br />

network of independent experts who will<br />

assess the solutions from a technical and<br />

financial standpoint.<br />

This is my new challenge and I do<br />

need all of you for that: demonstrate that<br />

solutions to solve climate change not only<br />

work, but are profitable and can improve<br />

the quality of life on Earth; that they are<br />

‘logical’ rather than simply ‘eco-logical’.<br />

Together we can make what was<br />

possible in the air, possible on the ground.<br />

We need to start telling ourselves, and our<br />

political leaders, that clean solutions are<br />

profitable, and that change is possible, not<br />

only in 2050, but already today.<br />

© Jean Revillard / Rezo.ch<br />

Join us!<br />

We want to find 1000 profitable<br />

and clean solutions to help<br />

governments, companies<br />

and institutions meet their<br />

environmental targets by adopting<br />

more ambitious policies. If you are<br />

working on innovative solutions,<br />

seeking how to use them in your<br />

daily lives or are keen to invest,<br />

we invite you to take part in our<br />

next big adventure! Visit www.<br />




ENERGY<br />

<strong>Climate</strong> <strong>Action</strong>’s Adam Wentworth spoke with Dr Christoph Frei,<br />

Secretary General of the World Energy Council, on why innovative<br />

policies are key to driving progress.<br />

Is there a model for how national<br />

governments can create the right set<br />

of sustainable energy policies?<br />

There is no doubt that the energy sector<br />

worldwide is undergoing a dramatic<br />

transition in which governments are playing<br />

their part. Many attribute this transition<br />

to the need to prevent, or at least plan for<br />

the potential impact of, climate change<br />

whilst enabling access for billions more<br />

new energy users and this in a context of<br />

dramatic innovation fuelled by electrification<br />

of final demand, decentralisation and<br />

digitalisation. The drive to reduce<br />

greenhouse gas emissions has certainly<br />

been a critical stimulus to the development<br />

of new technologies such as solar and<br />

wind, which are becoming increasingly<br />

competitive with traditional energy systems<br />

based on fossil fuels and nuclear.<br />

Focused, innovative, well-designed<br />

energy policies are the key to tackling<br />

continued uncertainty and dynamic<br />

changes, if the goal of a sustainable<br />

energy future is to be achieved, as<br />

identified in our 2016 World Energy<br />

Council Energy Trilemma report presented<br />

at last year’s Clean Energy Ministerial.<br />

The quest to finance the transition to a<br />

more sustainable energy system remains<br />

an issue that keeps energy leaders and<br />

policymakers busy at work, while there<br />

is a growing acknowledgement that<br />

adaptation to new resilience challenges,<br />

new digital solutions and smart innovation<br />

as well as regional interconnection will<br />

be key parts of the solution. If we are to<br />

The one thing, above everything<br />

else, that is keeping energy leaders<br />

awake at night is the impact of<br />

digitalisation.<br />

successfully meet the Trilemma goals of<br />

security, sustainability and equity, leaders<br />

need to come up with innovative policies<br />

and look beyond the energy sector, which<br />

will require changes to the economy,<br />

to our transportation, manufacturing,<br />

construction and agricultural sectors.<br />

The forecasts for growth in the<br />

renewable energy sector have<br />

confounded many expectations. Do<br />

you think the current high levels of<br />

capacity can continue?<br />

We have seen a dramatic increase of<br />

unconventional resources and no less<br />

dramatic technology improvement in the<br />

renewables space over the past decade,<br />

in particular, driven by wind and solar.<br />

In 2015, the share of renewable energies<br />

in total global power generation was<br />

23 per cent, exactly the same figure as<br />

in 1970. This is going to change within<br />

the next 45 years. In our latest World<br />

Energy Scenarios report, which sets out<br />

three potential pathways for the energy<br />

sector to 2060, we see a strong increase<br />

in the share of renewable energies. The<br />

share being up to two third by 2060 –<br />

depending on the respective scenario.<br />

In other words, most of the new power<br />

generation will be covered by renewables,<br />

with the use of coal as a prime energy<br />

source in decline.<br />

What are the main issues renewable<br />

energy will face once it becomes a<br />

mainstream energy source?<br />

Renewables such as solar, wind and<br />

hydropower now account for about 30 per<br />

cent of the total installed power generating<br />

capacity and 23per cent of total global<br />

electricity production and will continue to<br />

grow. However, more progress is urgently<br />

needed to scale up action on energy<br />

efficiency. Given the intermittency of energy<br />

from renewable sources, we have to rethink<br />

the system from one where supply follows<br />

demand to one where demand follows<br />

supply. This will be enabled by progress<br />

in demand response, sector coupling,<br />

smart grids and ultimately an internet of<br />

things in energy, all different features of<br />


ENERGY<br />

In the past 45 years, the average<br />

rate of decarbonisation has been<br />

around 1 per cent per year. To keep<br />

temperature rises below 2°C, this<br />

needs to be 6 per cent, per year.<br />

the digitalisation in energy. With a less<br />

concentrated, more material intense and<br />

more decentralised nature of the system<br />

issues such as recycling of (scarce)<br />

materials will also become more important.<br />

Are there any sectors in particular<br />

which are facing real challenges in<br />

being able to make the transition to a<br />

low-carbon future?<br />

Transitioning global transport currently<br />

forms one of the hardest obstacles to<br />

overcome in an effort to decarbonise<br />

future energy systems. Take Germany<br />

for example: Between 1990 and 2016,<br />

a reduction in CO 2<br />

emissions of 24 per<br />

cent was achieved, but the transport<br />

sector contributed 0 per cent to this<br />

development. However, according to our<br />

scenarios work, globally, we will see an<br />

increase in the electric vehicle share of<br />

the light-duty vehicle fleet from 2.5 to 2.7<br />

times by 2060. Different scenarios show<br />

oil’s share in transport decreasing from the<br />

92 per cent it is at today to between 78, 67<br />

and 60 per cent.<br />

Advances in second and third<br />

generation biofuels make substantial<br />

headway in all three scenarios, ranging<br />

from 10, 16 and 21 per cent. In addition,<br />

two of our scenarios see rapid penetration<br />

of electric and hybrid plug-in vehicles<br />

globally, which reflects 26 to 32 per cent<br />

of the light-duty vehicle fleet in 2060.<br />

We have recently seen France and the<br />

UK announcing the end of diesel and<br />

gasoline by 2040, the German Parliament<br />

having discussed a similar measure<br />

possibly before that. Most importantly,<br />

China’s Government is considering such<br />

measures and this would be a game<br />

changer for transport if it went ahead. The<br />

world’s largest vehicle market would then<br />

march to a tipping point and pull others<br />

to follow.<br />

80<br />

The World Energy Council has just<br />

finished its World Energy Week and<br />

Executive Assembly. Were there any<br />

clear themes on sustainability which<br />

emerged from the discussions?<br />

Decarbonisation is only part of the transition<br />

story. Electrification of final demand<br />

combined with decentralisation and<br />

digitalisation define an incredible space<br />

of innovation in terms of technology and<br />

business models. Our <strong>2017</strong> World Energy<br />

Trilemma report assesses decentralisation<br />

and its potential impact on backbone<br />

infrastructure and discussions at the World<br />

Energy Week highlighted the related<br />

uncertainties and raise questions about<br />

solidarity, cyber security, and competition<br />

between incumbents and new players.<br />

The research behind our Energy<br />

Trilemma report this year, has attempted<br />

to gauge the potential impact of the<br />

energy transition, and in particular,<br />

decentralisation, on the wide range of<br />

energy systems that exist in different<br />

countries around the world. Renewables<br />

and digital innovation open-up<br />

opportunities for new entrants who can<br />

compete to provide prosumers with an<br />

array of new services, act as aggregators,<br />

deliver new forms of supply and system<br />

support products, and compete with<br />

existing assets.<br />

Implications and opportunities differ<br />

greatly in developed countries with<br />

established transmission infrastructures,<br />

compared with developing and emerging<br />

countries where access to energy is still<br />

a major obstacle to be overcome and<br />

where rural entrepreneurs offer solutions<br />

in a space that previously was simply left<br />

in the dark.<br />

What is the World Energy Council’s<br />

role in promoting responsive and<br />

responsible leadership?<br />

The Council is the largest global network<br />

of energy leaders and practitioners<br />

dedicated to delivering a sustainable<br />

energy system for the greatest benefit of<br />

all. Originally intended as an organisation<br />

to manage a gathering of energy experts,<br />

we have evolved into one of the world’s<br />

most influential energy organisations with<br />

our leadership dialogue focused on the<br />

energy transition.<br />

We continue to deliver on our original<br />

goal by organising the world’s largest allenergy<br />

event, the World Energy Congress.<br />

In addition to global and regional<br />

Energy Leaders Summits and Ministerial<br />

Roundtables as well as national dialogues<br />

aimed at supporting policymakers,<br />

experts and industry leaders as they<br />

seek solutions to shape and successfully<br />

master the transition.<br />

The Council also publishes authoritative<br />

studies – our World Energy Scenarios,<br />

Trilemma, Issues Monitor and innovation<br />

work – to help further the vision of a<br />

sustainable energy future and promote<br />

responsive and responsible leadership.<br />

As the UN-accredited global energy body,<br />

we work with governments, agencies<br />

and companies to help inform policy<br />

development and strategic decisionmaking<br />

and planning.<br />

Are there any new technologies<br />

or innovations in energy which<br />

are exciting you, or could be<br />

transformative in the future?<br />

If the Grand Transition is driven by<br />

a combination of factors including<br />

decarbonisation, electrification of final<br />

demand, decentralisation, digitalisation and<br />

resilience to new physical risks such as<br />

extreme weather, cyber or the energy water<br />

food nexus, a number of specific innovation<br />

areas capture particular attention.<br />

The one thing above everything else<br />

that is keeping energy leaders awake at<br />

night is the impact of digitalisation on<br />

the future of the energy system. New<br />

business models and digitalisation will<br />

define momentum on a path of innovation<br />

which will change the way we produce<br />

and use energy in industrialised and<br />

developing worlds; and how the resulting<br />

transformation will drive new realities and<br />

priorities in global energy governance.<br />

We see a world where big data,<br />

machine learning, and artificial

Dr Christoph Frei, Secretary General<br />

of the World Energy Council<br />

ENERGY<br />


ENERGY<br />

intelligence enable automated system<br />

analytics and instant demand response<br />

is very different from the analogue<br />

world where many leaders started<br />

their careers. Predictive maintenance<br />

and supply chain management can<br />

dramatically decrease outage times<br />

and offers entirely new opportunities<br />

in traffic and congestion management.<br />

We also see a world in which the<br />

internet of things and blockchains<br />

will enable direct and low-cost<br />

transactions between parties and<br />

between appliances is fast approaching,<br />

with at its core precisely recorded<br />

transactions in unfalsifiable ledgers<br />

that also open new possibilities for<br />

supply chain tracing and product<br />

labelling by fabrication origin, materials<br />

used or emissions caused. Blockchain<br />

is an issue that is currently on the<br />

top of Energy Leaders’ list of critical<br />

uncertainties.<br />

Other areas of critical interest are<br />

storage and e-mobility as these have great<br />

potential to accelerate decarbonisation<br />

82<br />

in transport, or new platform business<br />

models as these have the potential to<br />

leverage existing assets in new utilisation<br />

areas – think of fridges or electric boilers<br />

combined with electric storage services.<br />

Last but not least, mobile banking<br />

supported by cloud technology is already<br />

today enabling micro-leasing schemes for<br />

rural households in the developing world<br />

and revolutionising opportunities also in<br />

the energy access space.<br />

These new technologies and business<br />

models will not only change the way<br />

we operate the energy system but will<br />

revolutionise the potential for a sharing<br />

and leasing economy in energy.<br />

Do you have any aspirations for what<br />

COP23 can, or should, achieve?<br />

Do you have a key message to<br />

attendees?<br />

The UN <strong>Climate</strong> Change Conference<br />

(COP23 Fiji) in Bonn comes at a time<br />

when it is no longer sufficient to maintain<br />

the momentum. In the past 45 years,<br />

the average rate of decarbonisation has<br />

been around 1 per cent per year. To keep<br />

temperature rises below 2°C, this needs<br />

to be 6 per cent, per year. This requires<br />

a revolution, not an evolution. Another<br />

way of trying to put a value on the rate<br />

of decarbonisation is to look at fossil<br />

reserves. We currently have an equivalent<br />

of 2,800 Gt CO 2<br />

in proven reserves of<br />

coal, oil and gas, but to not exceed the<br />

2°C target, we could only emit 1,000 Gt of<br />

CO 2<br />

. Behind these figures hides potential<br />

for geopolitical tension, which has to<br />

be overcome. The Paris Agreement got<br />

us one third of the way to meeting the<br />

temperature change target and we see<br />

many countries introducing concrete steps<br />

post-Paris.<br />

We now need to take the next leap<br />

in closing the ambition gap, delivering<br />

on implementation and accelerating<br />

on innovation. The world is now on<br />

a trajectory where only a climate of<br />

innovation will allow us to navigate the<br />

way to a truly sustainable energy future<br />

for the greatest benefit of all.

Let’s create a world<br />

that runs entirely on<br />

green energy.<br />

A decade ago, as DONG Energy, we started transforming<br />

from a black to a green energy company. Today, as Ørsted,<br />

we have become a global leader in offshore wind. In <strong>2017</strong>,<br />

we succeeded in driving the cost of offshore wind below<br />

that of new coal and gas power. By 2023 we will no longer<br />

use coal and have reduced our CO 2 emissions by 96%<br />

compared to 2006.

ENERGY<br />



INTO OUR<br />

ENERGY<br />


Credit: Renewables <strong>2017</strong> Global Status Report, Paris, REN21 Secretariat<br />

Wind Power Works, Rio do fogo,<br />

Rio Grande do Norte, Brazil<br />


Christine Lins,<br />

Executive Secretary of REN21<br />

When REN21 was founded in 2004,<br />

the future of renewable energy<br />

looked very diff erent from what<br />

is possible today. No one imagined back<br />

then that nearly 60 per cent of newly added<br />

power capacity would be renewablesbased<br />

– but that is what we see today. No<br />

one imagined that tens of millions of homes<br />

and businesses would add solar PV to<br />

their rooftops so rapidly. No one imagined<br />

that China would go from being a minor<br />

player to a global leader in less than ten<br />

years. No one imagined that emerging<br />

economies and developing countries would<br />

attract nearly 50 per cent of global annual<br />

renewable energy investment, totalling<br />

US$250 billion by the end of 2016.<br />

Today, we can categorically state that<br />

the worldwide diff usion and uptake of<br />

renewable energies has outstripped all our<br />

expectations. The expansion of renewable<br />

energy technologies has been driven<br />

by a changing global policy landscape<br />

that has drawn investments and created<br />

attractive markets. In turn, economies of<br />

scale and technology advances have led<br />

to decreasing costs and fuelled sustained<br />

growth in the sector.<br />

A handful of countries have led the way,<br />

developing innovative policies that have<br />

driven much of the change witnessed over<br />

the past decade. The challenge now is<br />

how to integrate high shares of renewables<br />

into the energy system. Today, the<br />

‘Energiewende’ model – the transition to a<br />

sustainable economy based on renewable<br />

energy and energy eff iciency – is inspiring<br />

many countries around the globe.<br />

While power systems have always<br />

had to accommodate variability in both<br />

supply and demand, the growing adoption<br />

of variable renewable energy (VRE) is<br />

changing how power systems are planned,<br />

designed and operated. The variability<br />

of output from solar and wind power<br />

requires more flexibility from the rest of<br />

the power system, including generating<br />

resources, distribution networks and even<br />

electricity consumers. The myth that fossil<br />

and nuclear power are indispensable to<br />

provide ‘baseload’ electricity supply when<br />

the sun is not shining or the wind is not<br />

blowing has been shown to be false.<br />

In areas where demand is growing<br />

(notably in developing economies), there is<br />

an opportunity for new and less-established<br />

power systems to grow in concert with<br />

higher shares of renewable generation,<br />

as more flexible systems are developed.<br />

85<br />


ENERGY<br />

Credit: ABENGOA<br />

A solar parabolic trough plant<br />

in Solana ,Arizona, USA.<br />

It is already possible to avoid lock-in of<br />

traditional baseload generation by using VRE<br />

to provide low-cost, clean energy access<br />

and while avoiding costly investments in<br />

traditional, and less flexible, generation and<br />

grid infrastructure. And this is good news for<br />

the climate as renewable resources have low<br />

greenhouse gas emissions.<br />

Discussion about 100 per cent<br />

renewable energy is also gaining<br />

prominence. It is further fuelled by the<br />

growing evidence that renewable energy<br />

when paired with energy efficiency is in<br />

many cases the most cost effective option<br />

today. In order to reach 100 per cent<br />

renewable energy a systems approach<br />

to energy – where the generation and<br />

use of renewable energy is looked at<br />

from a cross-cutting perspective – needs<br />

to be adopted. This includes looking<br />

at supporting infrastructure such as<br />

transmission and distribution networks,<br />

balancing supply and demand measures,<br />

energy efficiency measures and sector<br />

coupling, as well as a wide range of<br />

enabling technologies. The inclusion<br />

of social participation, in the form of<br />

universal energy access, socio-economic<br />

co-benefits and the empowerment of<br />

marginalised social groups and local<br />

communities is also part of the approach.<br />

Renewable energy coupled with<br />

innovative approaches present myriad<br />

benefits that set them apart from their<br />

86<br />

traditional counterparts. They draw<br />

on local resources, can be installed<br />

quickly in centralised or decentralised<br />

configurations and, unlike traditional<br />

systems, are not hampered by a lack of<br />

existing infrastructure. They do not emit<br />

greenhouse gases or other pollutants<br />

during generation and generally require<br />

little water to operate. Due to their<br />

decentralised nature, they can also<br />

improve system security in the face of<br />

extreme events due to climate change. In<br />

the power sector VRE is now the lowestcost<br />

source of newly constructed power<br />

generation available in many parts of the<br />

The growing<br />

adoption of<br />

variable renewable<br />

energy (VRE) is<br />

changing how<br />

power systems are<br />

planned, designed<br />

and operated.<br />

world, thanks to rapidly declining capital<br />

costs and zero fuel costs.<br />

REN21’s latest Renewables Global<br />

Futures Report documents an<br />

overwhelming consensus that renewable<br />

power will dominate in the future. The<br />

key lesson for integrating large shares<br />

of variable renewable generation is to<br />

ensure maximum flexibility in the power<br />

system. A shift away from the traditional<br />

‘baseload thinking’ in power system<br />

planning and operations will facilitate<br />

optimal integration of growing shares of<br />

VRE while providing on-demand, reliable<br />

and affordable electricity.<br />

There is broad consensus among the<br />

world’s leaders that we need to work<br />

together to mitigate climate change.<br />

Increasingly countries are on a pathway<br />

to decarbonise their energy sectors, and<br />

more and more corporations are joining<br />

them in this endeavour by subscribing<br />

to ambitious renewable energy targets.<br />

As VRE resources and other enabling<br />

technologies – including storage, demand<br />

response and efficiency improvements<br />

– continue to achieve more favourable<br />

cost and performance characteristics, the<br />

incentive to deploy them will continue to<br />

increase. The resulting changes will move<br />

both new and existing power systems<br />

further towards a model of flexible, clean,<br />

renewable generation. This is good news<br />

for our climate.

*<br />

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To learn more go to: Eaton.com/whatmatters<br />

We make what matters work.

ENERGY<br />

AFRICA’S<br />


ENERGY:<br />



The geographical spread of renewable energy<br />

resources in Africa gives each region a comparative<br />

advantage that can be used for its benefit... However,<br />

despite the enormous potential, many of these resources are<br />

not fully developed.<br />


Dr Amani Abou-Zeid, Commissioner<br />

for Infrastructure and Energy at the<br />

African Union Commission (AUC)<br />

Africa has vast renewable energy<br />

resources including hydro, solar,<br />

wind, geothermal and biomass,<br />

spread throughout the continent.<br />

Hydropower worth about 12 per cent of<br />

the world’s technically feasible potential<br />

is found in Africa, and could generate<br />

over 1,800TWh/yr of electricity. Though<br />

available in most parts of the continent,<br />

huge hydropower resources are located<br />

in central, eastern and southern regions of<br />

Africa. The continent’s largest hydropower<br />

site with a capacity of well over 30,000<br />

MW, the Grand Inga project, one of the<br />

African Union’s flagship projects, is found<br />

in the Democratic Republic of Congo.<br />

Geothermal energy is predominantly<br />

found in the east African region, and its<br />

potential is estimated at over 15,000 MW.<br />

Solar and wind energy resources are<br />

found throughout the continent; however,<br />

the Sahara desert and other arid areas<br />

off er excellent locations for diff erent<br />

types of solar energy development. A<br />

huge variety of biomass resources are<br />

distributed in all regions, with the reserves<br />

of woody biomass alone estimated at over<br />

70 billion tonnes.<br />

The geographical spread of renewable<br />

energy resources in Africa gives each<br />

region a comparative advantage that<br />

can be used for its benefit, as well as<br />

promoting synergy with the rest of the<br />

continent, providing reliable least-cost<br />

energy. However, despite the enormous<br />

potential, many of these resources are<br />

not fully developed. According to the<br />

International Renewable Energy Agency<br />

(IRENA), Africa’s installed capacity from<br />

renewable energy in 2016 was 38.3GW,<br />

which was about 2 per cent of the global<br />

renewable energy installed capacity of<br />

2,008GW. The African Union Commission<br />

(AUC), working closely with regional<br />

economic communities, member states<br />

and development partners, has designed<br />

programmes aimed at promoting the rapid<br />

development of African renewable energy.<br />

This requires the participation of public<br />

sector, private sector and civil society,<br />

including community-based initiatives<br />

and small and medium-sized enterprises<br />

(SMEs). One of the critical areas to<br />

address to pave the way for diff erent<br />

actors is the energy market structure.<br />

The AUC, in cooperation with regional<br />

economic communities, power pools,<br />

specialised pan-African organisations and<br />

member states, is working to develop a<br />

continental energy market that enhances<br />

eff iciency and competitiveness; and support<br />

private sector participation to complement<br />

public sector resources. A Strategy and<br />

<strong>Action</strong> Plan for the harmonisation of policy<br />

and regulatory frameworks have been<br />

developed and adopted by the specialised<br />

ENERGY<br />

The Olkaria II Geothermal<br />

Power Station in Kenya<br />


ENERGY<br />

Technical Committee of Ministers<br />

responsible for the sector.<br />

The <strong>Action</strong> Plan is structured into<br />

three terms: short (3-5 years: <strong>2017</strong>-2021),<br />

medium (6-8 years: 2022-2024) and<br />

long (9-14 years: 2025-2030). To ensure<br />

the development of regional electricity<br />

markets in Africa, the Plan supports<br />

policy and legislative instruments, as<br />

well as other measures to be taken at<br />

the national, regional and continental<br />

levels. A continental electricity market will<br />

create opportunities where each region,<br />

through its power pool, can place its most<br />

competitive energy into the market. It<br />

will also enhance the reliability of supply,<br />

as well as enabling interdependence<br />

of different regions for reserve margins<br />

and peak support, by making use of<br />

such elements as different time zones,<br />

differences in peak time, hydrological<br />

seasonality, and intermittency of resources<br />

such as wind and solar.<br />

To develop the renewable energy<br />

resource on the continent, the AUC is also<br />

focusing on the infrastructure development<br />

that will enable the interconnection of all<br />

regions through high voltage transmission<br />

lines. Key transmission corridors linking<br />

regions and connecting generation<br />

resources to demand centres have been<br />

identified under the Programme for<br />

Infrastructure Development for Africa<br />

(PIDA). These transmission corridors are<br />

at various stages of implementation under<br />

the coordination of the AUC and NEPAD<br />

Planning and Coordination Agency (NPCA).<br />

One of the challenges facing the<br />

African continent is low access to modern<br />

energy services, with more than 600<br />

million people lacking connections to<br />

90<br />

The Grand Inga project in the Democratic Republic of Congo is Africa’s largest<br />

hydropower site with a capacity of well over 30,000 MW<br />

electricity. To address this challenge<br />

through renewable energy resources, AUC<br />

is also developing specific interventions<br />

for specific types of renewables. The<br />

Commission’s small hydropower,<br />

bioenergy and solar energy programmes<br />

aim at benefiting local communities for<br />

domestic as well as productive uses.<br />

These programmes are the focus of<br />

Renewables planning<br />

To take full advantage of the<br />

opportunities that renewable<br />

energy resources in Africa present,<br />

it is necessary to ensure that:<br />

• The harmonisation of the<br />

regulatory frameworks is<br />

implemented, and member<br />

states and power pools that<br />

require support are assisted.<br />

• Missing links in the<br />

interconnection of electricity<br />

networks across the continent<br />

are fast-tracked to completion.<br />

• Innovation is embraced, both<br />

in technology and business<br />

models, in order to accelerate<br />

the rate of energy access using<br />

renewable energy resources.<br />

• Development of decentralised<br />

systems is encouraged, along<br />

with the introduction of business<br />

models that embrace different<br />

players in the energy market –<br />

including SMEs and non-state<br />

actors.<br />

policy guidelines, building capacity<br />

and designing appropriate frameworks<br />

for adoption by member states. The<br />

AUC is currently developing technical<br />

and commercial regulatory models<br />

for micro and mini grids that member<br />

states can adapt to suit their specific<br />

requirements. The Commission is also<br />

building a collaboration network with the<br />

Regional Centres for Renewable Energy<br />

and Energy Efficiency to strengthen the<br />

flow of information and dissemination<br />

of continental programmes to the areas<br />

where they are most needed. This network<br />

will also encourage peer learning among<br />

the centres.<br />

In addressing policy and strategy<br />

concerns affecting renewable energy in<br />

Africa, it is important to address specific<br />

challenges that are unique to various types<br />

of renewables. In the case of geothermal,<br />

the risks are present in the upstream<br />

stage development during surface studies,<br />

exploration drilling and appraisal drilling.<br />

These make it difficult for member states<br />

to attract private investment in the sector;<br />

and the few investors that undertake this<br />

mark up their prices significantly. The<br />

AUC, together with development partners<br />

including the DFID, kfW, New Zealand,<br />

Power Africa and Germany, have designed<br />

the Geothermal Risk Mitigation Facility<br />

(GRMF) to support private and public<br />

developers during the upstream phase.<br />

The GRMF provides grants for feasibility<br />

studies, exploration drilling and appraisal<br />

drilling. In addition GRMF supports capacity<br />

development for developers through<br />

technical training. Since its establishment<br />

in 2012, GRMF has supported 27<br />

developers, both private and public, over<br />

four application rounds and has awarded<br />

grants worth US$97 million. Building on<br />

this experience, the AUC has developed<br />

Africa Geothermal Drilling Code, adapted<br />

from New Zealand, and has set up a<br />

Regional Geothermal Centre of Excellence<br />

based in Kenya, which is a leading light in<br />

geothermal development in Africa.<br />

In the case of small hydropower<br />

development, the starting point is<br />

mapping of the resource to establish<br />

the actual potential and identify sites to<br />

which developers can be directed. Further,<br />

capacity development for technicians to<br />

carry out operation and maintenance of<br />

the plants is crucial. The AUC is designing<br />

a programme to address these issues,<br />

starting in <strong>2018</strong>.

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ENERGY<br />



ENERGY<br />


OVER<br />



Leena Srivastava,<br />

Vice Chancellor of TERI University<br />

India ratified the Paris Agreement just<br />

over a year ago. A cornerstone of<br />

India’s commitment towards climate<br />

action is its acknowledged ambitious<br />

target on renewable energy. Starting with<br />

a relatively modest target of 20GW of<br />

renewable energy by 2022 (announced in<br />

2008), India rapidly scaled up this ambition<br />

to 175GW (in January 2015)! Undoubtedly,<br />

the rapid progress on renewable energy<br />

technologies and the trend of rapidly<br />

declining international prices, combined<br />

with the growing demand for, as well<br />

as shortages of, energy gave India the<br />

confidence that this would be a win-win<br />

commitment for the country.<br />

As part of its pledges under the Paris<br />

Agreement, India has said that it will<br />

produce 40 per cent of its energy through<br />

non-fossil sources by 2030 – placing the<br />

renewable energy target in that year in the<br />

vicinity of an estimated 300GW.<br />

So, how is India faring in meeting<br />

its ambitions? On the positive side, the<br />

continuing ambitious pronouncements<br />

of the government are keeping the<br />

industry excited. The lowest solar power<br />

bid that the country saw in May <strong>2017</strong> was<br />

Rs2.44/unit – significantly lower than<br />

coal thermal prices of around Rs3.20<br />

per unit and a solar power bid of Rs2.97<br />

in February of the same year. Earlier<br />

in October <strong>2017</strong>, the bid price for wind<br />

power projects in the country saw tariffs<br />

fall to Rs2.64 per unit. No surprise then<br />

that there seems to be a rethink on coal<br />

power generation in the country.<br />

On the negative side, however, the<br />

initial euphoria on the renewable energy<br />

sector in the country is being tempered,<br />

if not already leading to anguish. There<br />

are several reasons for this. First, the<br />

extremely low discovery prices for solar<br />

and wind power in certain places are,<br />

in turn, leading to extremely aggressive<br />

ENERGY<br />

The extremely low discovery<br />

prices for solar and wind power in<br />

certain places are leading to extremely<br />

aggressive negotiation by procurers in<br />

other locales.<br />


ENERGY<br />

100<br />

80<br />

Figure 1: India’s 2022 renewable energy target<br />

20 GW<br />

Utility scale<br />

solar projects<br />

Capacity (InGW)<br />

60<br />

40<br />

20<br />

0<br />

5 GW<br />

10 GW<br />

60 GW<br />

40 GW<br />

40 GW<br />

Rooftop<br />

solar projects<br />

Ultra mega park<br />

solar projects<br />

Source: ET Energyworld<br />

Small Hydel Projects Biomass Wind Solar<br />

Source of renewable energy<br />

Driven from the highest level of<br />

government, all actors sought to align<br />

themselves quickly to the needs of the<br />

sector.<br />

negotiation by procurers in other locales<br />

as well, pushing developers to lower<br />

prices, even below their winning bids!<br />

In some instances, existing contracts<br />

have been reopened for re-negotiation.<br />

As a result of such factors, financial<br />

institutions have become wary of<br />

renewable energy projects and are not<br />

enthusiastic about lending support to<br />

them. The market is thus beginning<br />

to see a number of winning bidders<br />

seeking to sell their projects even before<br />

starting work on them.<br />

The poor state of the centralised<br />

grid infrastructure as well as the poor<br />

financial health of the renewable energy<br />

procurement entities (the distribution<br />

companies) has further eroded the<br />

confidence of financial institutions on the<br />

risks, and the financial viability, of such<br />

projects. Unfortunately, the government’s<br />

attempts to address these bottlenecks<br />

seem to be too little and too late for some<br />

of these projects.<br />

The solar rooftops programme in the<br />

country is not taking off at the desired<br />

speed, for many reasons ranging from<br />

practical problems on the ground from<br />

taxation structures, to multiple uses of<br />

roof space, a weak confidence in systems<br />

and performance as well as a reluctance<br />

on the part of distribution utilities to<br />

support this scheme.<br />

Preparation on the supporting<br />

environment is often inadequate to allow a<br />

timely delivery of desired outcomes – be it<br />

related to buy-in from state governments,<br />

land acquisition, strength and modernity of<br />

the grid infrastructure, presence of market<br />

actors along the value chain or indeed<br />

the capacities that exist within policy and<br />

regulatory bodies to quickly and effectively<br />

deal with emerging challenges.<br />

And finally, the ability may be lacking<br />

to cope with the rapidly evolving<br />

technological solution space and the<br />

capability to be able to look at integrated<br />

systemic solutions.<br />

Despite the daunting difficulties, it is<br />

also a fact that India will still have a much<br />

larger renewable energy capacity in<br />

place by 2022 than it would have without<br />

such ambitious goals. It has proved to<br />

the world that when political ambition<br />

exists then outcomes will follow willy-nilly.<br />

The pressure to deliver on the ambition<br />

combined with the need to keep tariffs low,<br />

in a price sensitive economy like India’s,<br />

has forced it to adapt global innovations<br />

as well as to innovate itself on things such<br />

as the reverse bidding process for price<br />

discovery. Driven from the highest level<br />

of government, all actors sought to align<br />

themselves quickly to the needs of the<br />

sector and challenges are being addressed<br />

as they emerge.<br />

Could India have done things differently?<br />

Yes, it could have ensured a more systemic<br />

planning and roll-out of activities; it could<br />

have built capacities in the policy and<br />

regulatory bodies, institutions and other<br />

stakeholders first; it could have examined<br />

and refined the various laws that would<br />

have enabled a smooth implementation of<br />

rooftop solar systems; and it could have<br />

sought to strengthen and modernise its<br />

grid infrastructure, among other measures.<br />

But a sequential approach of this kind<br />

would not have guaranteed a problem-free<br />

transformation of the economy towards<br />

greater renewables, nor would it convey the<br />

sense of urgency with respect to climate<br />

action that India is succeeding in doing –<br />

for its own populations and the world.<br />







THE U.S.<br />

ENERGY<br />

As an international leader in energy<br />

technology, development and<br />

delivery, the U.S. is not just making<br />

promises about clean energy and energy<br />

efficiency, we are acting on them - and<br />

our actions are proving that you can drive<br />

economic growth while also upholding<br />

environmental stewardship.<br />

Energy productivity is an important<br />

driver of economic prosperity in America.<br />

Since 1970, the size of the U.S. economy<br />

has tripled and energy productivity has<br />

more than doubled. That means for every<br />

kilowatt hour and gallon of gasoline<br />

we consume we are getting twice as<br />

much economic output. Consumers are<br />

also dedicating a smaller percentage of<br />

household spending to energy than at any<br />

other time on record. This has occurred<br />

through decades of scientific innovation<br />

and entrepreneurship. The Department of<br />

Energy’s (DOE’s) 17 National Laboratories<br />

have played an important role in this<br />

scientific innovation, helping to improve<br />

the efficiency of many products and saving<br />

money for their users.<br />

One such example is refrigerators.<br />

Today, refrigerators use about a quarter<br />

Daniel Simmons, Acting Assistant<br />

Secretary, Office of Energy Efficiency<br />

and Renewable Energy (EERE), U.S.<br />

Department of Energy<br />

The energy America is producing<br />

today is not only more efficient, but<br />

also more affordable and cleaner than<br />

ever before.<br />


ENERGY<br />

of the energy they used in 1980, while<br />

being bigger, having more features, yet<br />

costing half of the price. Another example<br />

is lighting. Between 2008 and 2015, DOE’s<br />

early-stage research on LED lighting<br />

helped contribute to costs dropping<br />

nearly 90 per cent. This rise in efficiency<br />

has led to a massive increase in market<br />

adoption of these lights, going from under<br />

100,000 bulbs to more than 200 million<br />

A-type bulbs in the country. Over 270<br />

patents have resulted from DOE research<br />

and development and have contributed<br />

to more than $2.8 billion in U.S. energy<br />

savings to date. We want positive changes<br />

in energy efficiency like these to continue.<br />

The energy America is producing<br />

today is not only more efficient, but<br />

also more affordable and cleaner than<br />

ever before, whether that be energy<br />

from coal, oil, natural gas, nuclear, or<br />

renewables. For example, the hydraulic<br />

fracturing revolution has cut oil prices<br />

in half and made natural gas three times<br />

less expensive than it was a decade<br />

ago. Levelised costs for wind and<br />

The DOE is eager to continue<br />

work with our international partners<br />

on policies that will expand access<br />

to affordable, reliable, and efficient<br />

energy to promote economic growth<br />

and energy security.<br />

solar technologies have also declined<br />

substantially in recent years, leading to<br />

increased renewable penetration in many<br />

parts of the country.<br />

Meanwhile, air quality is improving<br />

dramatically. According to the<br />

Environmental Protection Agency (EPA),<br />

from 1970 to 2016, U.S. GDP grew by<br />

253 per cent; vehicle miles traveled<br />

increased by 190 per cent; overall energy<br />

consumption increased by 44 per cent; yet<br />

total air pollution (or criteria pollutants) fell<br />

by 73 per cent.<br />

With the modern technology we have<br />

access to today, our country, and the<br />

world, have an immense amount of clean<br />

energy resources to choose from. Over<br />

the past three decades, the U.S. coal fleet<br />

alone has dramatically reduced emissions<br />

of air pollutants: Since 1970, Nitrogen<br />

Oxides (NOX), Sulfur Dioxide (SO2), and<br />

airborne particulates (PM) emissions<br />

(per kWh of electricity generated) have<br />

decreased by 85 to 93 per cent.<br />

The Department’s Clean Coal<br />

Technology program laid the foundation<br />

for many commercially successful coal<br />

Comparison of Growth Areas and Emissions, 1980-2016<br />


ENERGY<br />

Between 2008 and 2015, DOE’s<br />

early-stage research on LED lighting<br />

helped contribute to costs dropping<br />

nearly 90 per cent.<br />

technologies that have significantly<br />

reduced air pollution and improved the<br />

environment—making today’s stateof-the-art,<br />

coal-fired power plants<br />

have a much smaller environmental<br />

footprint. For a new pulverised coal<br />

power plant, the implemented pollution<br />

controls reduce NOX by 85 per cent,<br />

SO2 emissions by 98 per cent, and PM<br />

by 99.9 per cent, when compared to<br />

an older plant that does not have these<br />

pollution controls.<br />

We also recognise the vital role<br />

of nuclear as a carbon dioxide-free<br />

technology. DOE is a world leader in<br />

advanced nuclear energy technologies<br />

research. This fall, the International<br />

Atomic Energy Agency designated two<br />

of our national labs, Oak Ridge National<br />

Lab and Idaho National Lab, as an<br />

International Centre based on Research<br />

Reactors. This designation makes the<br />

U.S. one of only four countries identified<br />

for unique capabilities and excellence in<br />

nuclear energy research. Nuclear energy<br />

is one of the most affordable, reliable, and<br />

clean energy sources on Earth, so it’s<br />

important that we utilise this resource to<br />

its fullest capability.<br />

Clean coal and nuclear are just<br />

two sources to our country’s diverse<br />

energy mix. DOE remains committed<br />

to a comprehensive energy strategy<br />

to ensure we are utilising all of our<br />

abundant, American energy resources,<br />

including coal, nuclear, natural gas,<br />

oil, and renewables. We hope our<br />

international partners will also undertake<br />

this same strategy to ensure energy<br />

affordability, security, and reliability<br />

throughout the world.<br />

International cooperation is critical<br />

to achieving our goals. Last month, I<br />

participated in the U.S.-China Energy<br />

Efficiency Forum in Denver, Colorado,<br />

where more than 150 U.S. and Chinese<br />

leaders and experts exchanged<br />

information on energy efficiency<br />

technologies, policies, and programmes.<br />

I discussed the Administration’s<br />

commitment to international leadership<br />

on energy issues.<br />

U.S. Secretary of Energy Rick Perry<br />

has made it a point that the U.S. wants to<br />

strengthen our international partnerships.<br />

At the Clean Energy Ministerial in Beijing,<br />

Africa Oil Week in South Africa, and<br />

other trips abroad, Secretary Perry has<br />

emphasised that he continues to believe<br />

we have extraordinary opportunities to<br />

be partners on the climate and clean<br />

energy issues. He has also authorised<br />

crude oil and LNG exports to several of<br />

our international partners, increasing jobs,<br />

economic stability, and national security<br />

across the globe.<br />

The DOE is eager to continue work with<br />

our international partners on policies that<br />

will expand access to affordable, reliable,<br />

and efficient energy to promote economic<br />

growth and energy security. I am confident<br />

that the U.S. will continue to serve as<br />

an example to the rest of the world on<br />

how to achieve economic, energy and<br />

environmental goals simultaneously,<br />

and I look forward to being a part of this<br />

ongoing effort.<br />




SHIPPING -<br />


FOR ALL<br />


Kitack Lim, Secretary General of<br />

the International Maritime<br />

Organization (IMO)<br />

Addressing the complexities of the<br />

climate change challenge requires<br />

a comprehensive and collaborative<br />

approach. No stakeholder can work on<br />

this alone. The global community has<br />

recognised this in the Paris Agreement<br />

and in the United Nations Sustainable<br />

Development Goal (SDG) 13. These<br />

bring nations into a common cause to<br />

undertake ambitious efforts to combat<br />

climate change and adapt to and mitigate<br />

its effects, with enhanced support to assist<br />

developing countries to do so.<br />

As part of the United Nations system,<br />

the International Maritime Organization<br />

(IMO) is fully committed to limiting and<br />

reducing greenhouse gas emissions<br />

from shipping. The approach taken by<br />

the IMO’s membership and its other<br />

stakeholders is based on building<br />

consensus and collaboration. These have<br />

been key to driving change at IMO.<br />

It is not possible to work towards<br />

decarbonising the maritime sector by<br />

working in silos. Shipping and the maritime<br />

sector are an essential component of world<br />

economic growth, with an impact across<br />

many stakeholders. Billions of people rely<br />

on shipping as the most cost effective and<br />

fuel efficient way to transport the essential<br />

raw materials, commodities and consumer<br />

goods that industries and communities<br />

need and want.<br />

So when we consider IMO’s responsibility<br />

to make sure that shipping has a minimal<br />

negative impact on the ocean and<br />

atmospheric environment, it is clear that<br />

we need to work closely with government,<br />

business, city ports, local authorities, other<br />

agencies, civil society groups and the<br />

communities that shipping serves.<br />

At a global level, IMO’s decision making<br />

process is characterised by pragmatic,<br />

realistic, workable, cost effective and well<br />

balanced decisions, in the formulation of<br />

which the views of all nations are taken<br />

duly into account. IMO has already adopted<br />

mandatory energy efficiency measures to<br />

reduce greenhouse gas emissions from<br />

ships, applicable to more than 96 per cent<br />

of the world’s merchant fleet by tonnage.<br />

The mandatory Energy Efficiency Design<br />

Index requires new ships to be built to<br />

be more energy efficient. And older ships<br />

must undergo a process to produce a Ship<br />

Energy Efficiency Management Plan.<br />

To support the implementation of these<br />

measures, at regional and national level,<br />

IMO promotes collaboration through<br />

its Integrated Technical Cooperation<br />

Programme (ITCP), which serves to assist<br />

governments that lack the technical<br />

knowledge and resources needed to operate<br />

a shipping industry successfully. The ITCP<br />

includes innovative major programmes<br />

specifically related to energy efficiency.<br />

The Global Maritime Energy Efficiency<br />

Partnerships Project (GloMEEP) was<br />

launched in 2015 in collaboration with the<br />

Global Environment Facility and the United<br />

Nations Development Programme. Under<br />

GloMEEP, 10 developing countries have<br />

committed to taking a lead role in creating<br />

the national policies, strategies and the<br />

legal framework to effectively implement<br />


Consensus and collaboration have<br />

been key to driving change at IMO.<br />



IMO member states have pledged<br />

to produce a comprehensive strategy<br />

for reducing greenhouse gas emissions<br />

from ships.<br />

IMO’s energy efficiency regulations. So<br />

far more than 400 people have been<br />

trained in national, regional and global<br />

workshops, and information tools and<br />

training packages have been developed to<br />

further support developing countries in the<br />

implementation of IMO’s energy efficiency<br />

provisions.<br />

A second global project, funded by<br />

the European Union, has established<br />

a network of five Maritime Technology<br />

Cooperation Centres (MTCCs) in Africa,<br />

Asia, the Caribbean, Latin America and<br />

the Pacific. Through collaboration and<br />

outreach activities at regional level,<br />

the MTCCs will help countries develop<br />

national maritime energy efficiency<br />

policies and measures, promote the<br />

uptake of low carbon technologies and<br />

operations in maritime transport and<br />

establish voluntary pilot data collection<br />

and reporting systems.<br />

IMO is also promoting collaboration<br />

with the private sector. The Global Industry<br />

Alliance to Support Low Carbon Shipping,<br />

known as the GIA, has been launched in<br />

<strong>2017</strong> under the auspices of the GloMEEP<br />

project to bring like minded private<br />

sector players together with a common<br />

objective of making the shipping industry<br />

greener. So far, 16 maritime private<br />

industry champions (including shipowners<br />

and operators, classification societies,<br />

engine and technology manufacturers<br />

and suppliers, big data providers, oil<br />

companies and ports) have signed up. The<br />

GIA will collectively identify and develop<br />

solutions that can support overcoming<br />

barriers to the uptake of energy efficiency<br />

technologies and operational measures in<br />

the shipping sector.<br />

These barriers have been identified<br />

as technical, financial, institutional and<br />

human element related. Overcoming<br />

them requires novel approaches, blue sky<br />

thinking, and working together through a<br />

collaborative and common approach. All of<br />

this collaboration, from capacity building<br />

to research projects to innovation, will<br />

support IMO’s regulatory work to reduce<br />

shipping’s negative impact on the ocean<br />

and the atmospheric environment.<br />

Steps are already being taken towards<br />

considering further measures to address<br />

greenhouse gas emissions from ships. The<br />

mandatory collection and reporting of fuel<br />

oil consumption data for ships of 5,000<br />

gross tonnage and above will begin from<br />

2019. This will provide a firm statistical basis<br />

for an objective, transparent and inclusive<br />

policy debate in IMO’s Marine Environment<br />

Protection Committee (MEPC), the forum<br />

where all environmental matters relating to<br />

shipping are discussed.<br />

IMO member states have pledged to<br />

produce a comprehensive strategy for<br />

reducing greenhouse gas emissions<br />

from ships. An initial strategy is set to be<br />

adopted in <strong>2018</strong>, to be revised by 2023,<br />

benefiting from statistical information from<br />

mandatory reporting. Collaboration and<br />

consensus will push forward this initial<br />

greenhouse gas strategy.<br />

The momentum driving this process is<br />

evidenced by the extensive participation<br />

and commitment shown in the meetings<br />

of the Intersessional Working Group on<br />

Reduction of GHG Emissions from Ships.<br />

The first meeting in June reported to the<br />

MEPC 71 session in July <strong>2017</strong>; the second<br />

in October worked to develop the initial<br />

strategy; and the third meeting in spring<br />

<strong>2018</strong> is expected to come up with the draft<br />

initial strategy, for adoption by the MEPC<br />

72 meeting in April.<br />

I am confident that IMO Member States<br />

will deliver on this. And I believe that by<br />

continuing to promote collaboration at all<br />

levels we can be positive about not just<br />

agreeing a strategy, but acting on it too.<br />







Credit: Bloomberg<br />

Global passenger electric<br />

vehicle sales will hit about<br />

1 million in <strong>2017</strong>.<br />



Colin McKerracher, Head of<br />

Advanced Transport at Bloomberg<br />

New Energy Finance<br />

The global automotive industry<br />

is entering a period of profound<br />

transformation. The combination<br />

of supportive policy and improvements<br />

in lithium-ion battery technology have<br />

enabled electric vehicles to gain a toehold<br />

in a market that has been dominated by<br />

the internal combustion engine for over a<br />

hundred years. Meanwhile, tightening fuel<br />

eff iciency regulations and urban air quality<br />

concerns are putting increased pressure on<br />

automakers to improve the rest of their fleet.<br />

Global passenger electric vehicle sales<br />

will hit about 1 million in <strong>2017</strong>, up from one<br />

hundred thousand just a few years earlier.<br />

There are now almost three million electric<br />

vehicles on the world’s roads. But before<br />

we get too excited about this progress, it is<br />

worth bearing in mind that the global fleet<br />

of all cars is around 1 billion. Reductions<br />

in emissions from road transport will be<br />

a key part of meeting climate targets, but<br />

an average vehicle is on the road for 12-15<br />

years, creating significant lock-in to our<br />

current transport system. So, just how far<br />

can EV adoption go and what would this<br />

mean for energy and automotive markets?<br />

Lithium-ion battery prices per kilowatthour<br />

dropped 74 per cent between 2010<br />

and 2016 and their energy density is<br />

improving by around 5 per cent per year.<br />

This puts electric vehicles on a path<br />

towards being fully cost-competitive with<br />

their internal combustion counterparts,<br />

a point that will be reached in diff erent<br />

countries from 2025 onwards. In response,<br />

automakers around the world are ramping<br />

up the number of electric models they<br />

off er – there are 150 diff erent plug-in<br />

hybrids and pure electrics available today,<br />

and this is set to rise to over 240 by 2021.<br />

Groups like VW, Daimler, Volvo and Nissan<br />

have made aggressive plans to electrify<br />

their vehicles over the next 10 years.<br />

China is pushing the hardest here.<br />

China’s 2025 auto plan calls for internal<br />

combustion sales to flatline and EVs to<br />

make up all vehicle sales growth over the<br />

next seven years. Its recently introduced<br />

‘new energy vehicle’ quota requires<br />

automakers to sell a set percentage of<br />

electric or fuel cell vehicles, which it will<br />

ratchet up over time. China is doing this<br />

not just to reduce oil imports and improve<br />

urban air quality, but also for industrial<br />

policy reasons. As the vehicle mix shifts,<br />

China wants to position its domestic<br />

automakers to leapfrog established<br />

international brands. A thriving, globally<br />

competitive auto sector is a major source<br />

of employment, investment and innovation.<br />

Nobody wants to see their national<br />

champions left behind.<br />

A view to 2040<br />

Each year at Bloomberg New Energy<br />

Finance, we publish a comprehensive<br />

global Electric Vehicle Outlook, in which<br />

we look at all the technology, policy and<br />

economics factors that could influence<br />

EV adoption over the next two decades.<br />

In this year’s report, we concluded that 54<br />

per cent of the world’s vehicle sales would<br />

be electric by 2040, with Europe, China<br />

and the U.S. the largest EV markets. Some<br />

countries will get there much sooner. In<br />

Norway – the leader on EV adoption –<br />

sales are already above 40 per cent and<br />

the government is aiming fully to phase<br />

out traditional vehicle sales by 2025.<br />

Our forecast would mean 530 million<br />

electric vehicles on the road in 2040, or<br />

around a third of the total fleet. This is a<br />

dramatic change from today and would<br />

require significant scale-up in the battery<br />

manufacturing supply chain, in materials,<br />

and in charging infrastructure. This many<br />

EVs would displace around eight million<br />

barrels per day of oil demand, and would<br />

increase global electricity demand by<br />

around 5 per cent. The power system can<br />

Credit: Bloomberg<br />

accommodate the additional demand, but<br />

smart-charging systems will be needed<br />

to ensure vehicles are not contributing to<br />

demand during peak periods. CO 2<br />

emissions<br />

would also fall. Even with power generation<br />

emissions in diff erent countries factored<br />

in, EVs still have a lower CO 2<br />

footprint per<br />

kilometre driven and this gap is set to widen<br />

further over time as the amount of renewable<br />

power generation grows.<br />

So what holds back further adoption?<br />

Charging infrastructure is still a major<br />

barrier, particularly in urban areas with<br />

limited off -street parking. Low average<br />

vehicle purchase prices and power grid<br />

issues in emerging economies also play a<br />

role. Supply constraints for key materials<br />

like cobalt, lithium and graphite could still<br />

slow down the declines in battery cost<br />

seen in recent years. Governments will<br />

need to recoup some of the lost revenues<br />



from fuel taxes levied on gasoline and<br />

diesel, while consumers will need to adjust<br />

how they refuel their vehicles.<br />

Accelerating the transition<br />

Of course, there are several factors that<br />

could cause things to move much faster.<br />

Our analysis is based mostly on economics<br />

and current technology trajectories, but<br />

a step-change in battery density or an<br />

improvement in charging technology<br />

options would hasten the transition.<br />

National governments in the U.K., France,<br />

the Netherlands, Norway and even India<br />

have indicated that they want to phase<br />

out internal combustion engine sales<br />

altogether. While these targets typically<br />

lack specific measures, they show just how<br />

quickly the landscape is changing. In the<br />

world’s largest cities, urban dwellers are<br />

becoming increasingly concerned with<br />

poor air quality and could force municipal<br />

governments to move even faster than their<br />

national counterparts. Policy has a big role<br />

to play here.<br />

On top of all this, new mobility business<br />

models such as ride hailing and car<br />

sharing are gaining traction around the<br />

world. Some customers are opting to<br />

buy kilometres of mobility rather than a<br />

vehicle of their own. Autonomous vehicles<br />

are set to debut in the 2020s and would<br />

accelerate this trend. At high utilisation<br />

rates, electric vehicles have much lower<br />

costs per kilometre and could be ideal for<br />

these types of applications.<br />

The automotive sector will change more<br />

in the next 10 years than it has in the last<br />

50. We are heading towards a cleaner<br />

transport system, with benefits for the<br />

environment and for consumers around<br />

the world – but much work remains to be<br />

done.<br />

New mobility business models<br />

such as ride hailing and car sharing are<br />

gaining traction around the world.<br />





TO GREEN<br />


The automobile industry has a<br />

storied tradition of adapting to<br />

an evolving market and new<br />

consumer tastes. Today, changes in<br />

the global environment are causing a<br />

transformation in the way we think about<br />

cars and individual mobility. The BMW<br />

Group has long been an industry leader in<br />

implementing green technologies, and is<br />

continuing to move the industry towards a<br />

greener future. <strong>Climate</strong> change and global<br />

warming require immediate action by the<br />

private sector to decarbonise and electrify<br />

production. The BMW Group already offers<br />

a wide variety of future mobility concepts<br />

and has a diverse selection of electrified<br />

vehicles in its product portfolio, such as<br />

the BMW i and iPerformance series.<br />

But the BMW Group’s climate strategy<br />

goes beyond just finished cars. Its vision<br />

for the future of individual mobility is<br />

spearheaded by an ambitious concept<br />

called ACES – Autonomous, Connected,<br />

Electrified, and Shared. This concept is<br />

already being implemented in the entire<br />

life cycle of BMW vehicles – from design<br />

104<br />

to production to ownership to recycling.<br />

Rather than just creating a sustainable<br />

end product, the BMW Group strives to<br />

be responsible at each and every step.<br />

Most importantly, the BMW Group is living<br />

proof that responsibility does not have<br />

to negatively impact profitability. On the<br />

contrary, the BMW Group has discovered<br />

the potential to reduce energy costs while<br />

increasing production and boosting profits.<br />

One important element of BMW’s<br />

corporate strategy has always been<br />

to manage its energy consumption to<br />

promote sustainability, while at the same<br />

time enhancing profitability. Now, BMW<br />

Energy Services, established in 2015 has<br />

stepped up to become a game changer<br />

in the energy business with its innovative<br />

energy solutions and new digital business<br />

models. For example, through the joint<br />

venture Digital Energy Solutions that was<br />

founded in 2015 together with Viessmann,<br />

BMW Energy Services has established<br />

service offers that are based on BMW<br />

Group competencies and technologies in<br />

the area of e-mobility, connected charging<br />

infrastructure, battery storage systems and<br />

energy management.<br />

A further example for energy<br />

management innovations that comprises<br />

energy and mobility is the BMW<br />

Speicherfarm Leipzig, a large scale battery<br />

storage farm built on the premises of the<br />

BMW Group plant in Leipzig. The first of its<br />

kind, it consists of up to 700 BMW i3 2nd<br />

life and new batteries that are intelligently<br />

warehoused as spare parts with a total<br />

power equaling 100,000 km in electric<br />

range. This battery storage farm will<br />

help to optimise the plant’s local energy

consumption regarding CO2 and cost but<br />

will also offer flexibility to the electric grid<br />

via demand side management from <strong>2018</strong><br />

onwards.<br />

For over 100 years now, the BMW Group<br />

has learned to lead by example. BMW<br />

tops the industry when it comes to green<br />

technology and CO2 emissions reduction.<br />

The Dow Jones Sustainability Index once<br />

again featured the BMW Group at the top<br />

of its rankings and as the best automaker<br />

of 2016. BMW plans on continuing its<br />

dedication to clean production and<br />

cleaner vehicles.<br />

One of BMW’s long term visions is to<br />

increase the share of alternative energy<br />

used in production to 100 per cent in the<br />

coming years. Currently, about 51 per cent<br />

of energy needs are through renewable<br />

energy, with power coming from sources<br />

like a biogas plant in Rosslyn, South Africa,<br />

and a brand new photovoltaic facility at<br />

our plant in Shenyang, China.<br />

To date, the BMW Group has already<br />

sold more than 100,000 electric vehicles<br />

and plug-in hybrids and now aims to<br />

achieve this same figure in <strong>2017</strong> alone.<br />

In this way, the BMW Group is helping<br />

to reduce greenhouse-gas emissions<br />

and improve air quality. The BMW Group<br />

reduced CO2 emissions of its newly<br />

sold vehicles in Europe by around 41<br />

per cent between 1995 and 2016. Our<br />

European vehicle fleet (EU-28) had an<br />

average fuel consumption of 4.6 l of<br />

diesel /100 km or 5.6 l of petrol per 100<br />

km and average CO2 emissions of 124 g<br />

/km (internal calculation). Our goal is to<br />

reduce CO2 emissions by at least 50 per<br />

cent between 1995 and 2020. Catering to<br />

our new urban lifestyles is another key<br />

to transforming the future. DriveNow and<br />

ReachNow, car-sharing services owned<br />

by the BMW Group, offer per-minute car<br />

rental in cities.<br />

The BMW Group is helping foster an<br />

important shift in individual mobility –<br />

away from private ownership of vehicles<br />

with combustion engines toward shared,<br />

electric, and digitalised solutions. As the<br />

climate changes, so does our industry.<br />

At the BMW Group, we proudly take<br />

on the challenge of innovating in a<br />

sustainable way. As we decarbonise<br />

the private sector and transform our<br />

economy for the future, the BMW Group<br />

will continue to excel at delivering quality<br />

automobiles and the sheer driving<br />

pleasure it has built its reputation on.<br />

The BMW Speicherfarm Leipzig is a large scale battery storage farm built on<br />

the premises of the BMW Group plant in Leipzig, Germany.<br />

Based on our own BMW Energy<br />

Cloud, we provide holistic energy<br />

solutions to our customers that<br />

encompass mobility and energy.<br />

BMW Energy Services thereby acts<br />

as an enabler of the BMW Group’s<br />

electrification strategy.<br />

Dr Joachim Kolling, Head of BMW Energy Services<br />



CITIES<br />

The Capibaribe Park project, in Recife, Brazil, will connect over 94,000 sq<br />

metres of green space, walkways and bike paths along the Capibaribe River.<br />




GOOD FOR<br />



Investing in<br />

sustainable, resilient<br />

communities pays off,<br />

but unilateral action<br />

is not enough. We<br />

need to build bridges<br />

between the public<br />

and private sectors<br />

to design, fund, and<br />

implement resilient<br />

city solutions.<br />

One of the key messages<br />

from business and local<br />

government leaders speaking<br />

at the Resilient Cities <strong>2017</strong><br />

congress in Bonn.<br />

Gino Van Begin, Secretary General<br />

of ICLEI – Local Governments for<br />

Sustainability<br />

At the Resilient Cities <strong>2017</strong> congress in<br />

Bonn earlier this year, the discussions<br />

focused on how to turn local climate<br />

adaptation and resilience plans into reality<br />

– a reflection of the current state of play in<br />

the field. Over the past 10 years, ICLEI (www.<br />

iclei.org) has seen a steady increase in the<br />

number of local governments assessing their<br />

climate risks, developing local strategies, and<br />

more recently, seeking to implement their<br />

plans through integrated sustainable and<br />

resilient actions.<br />

Take Recife, Brazil, which has developed<br />

the ‘Recife 500 Years, the City we Want’<br />

master plan for comprehensive sustainable<br />

urban development. The plan includes<br />

the Capibaribe Park project, which is also<br />

part of the ICLEI Transformative <strong>Action</strong>s<br />

Program. The park will connect over 94,000<br />

sq metres of green space, walkways and<br />

bike paths along the Capibaribe River,<br />

providing recreational and commercial<br />

benefits. By reducing motorised transport<br />

and restoring ecosystems, the project will<br />

decrease urban emissions by an estimated<br />

8,000 tons of CO 2<br />

per year while mitigating<br />

the impact of climate hazards including<br />

heat waves and flooding.<br />

Recife is not alone. Over 1,510 adaptation<br />

actions by cities, towns, and regions have<br />

been reported to the carbonn® <strong>Climate</strong><br />

Registry (cCR), a global reporting platform<br />

with over 1,000 registered entities. In<br />

a subsample of 267 actions reported<br />

by 132 subnational governments in 35<br />

countries, at least 77 per cent were aligned<br />

with national-level goals and the Paris<br />

Agreement, and over half addressed both<br />

mitigation and adaptation.<br />

When implementing these actions,<br />

however, local governments often face<br />

institutional barriers from financial and<br />

governance systems whose regulations<br />

and cultures are themselves not adapted<br />

to enable resilient urban development. The<br />

Capibaribe Park project budget is US$94<br />

million, part of the US$620 million needed<br />

for the Recife 500 Years master plan.<br />

Municipal funding is not enough. Urgent<br />

support is needed from public and private<br />

partners to help subnational governments<br />

finance and implement integrated climate<br />

action in innovative ways.<br />

What does this look like? One aspect<br />

is reforming the global financial sector<br />

and reducing the perception that local<br />

adaptation investments are high risk and<br />

low reward. In 2014, a mere 7 per cent of<br />

global climate finance went towards climate<br />

adaptation, and most was inaccessible to<br />

subnational governments. More favourable<br />

legislative and regulatory conditions are<br />

needed along with appropriate financial<br />

intermediaries at the subnational level.<br />

Guidance is also needed for project<br />

preparation and governance. ICLEI and<br />

other members of the Cities <strong>Climate</strong><br />

Finance Leadership Alliance are building<br />

capacity in these areas to help local<br />

governments develop bankable projects<br />

and bolster public and investor confidence.<br />

Another aspect is cultivating<br />

relationships with private sector partners<br />

built on mutual interest and trust.<br />

Copenhagen, Denmark and Oslo, Norway<br />

are illustrative cases. Both cities are<br />

working with insurers to pool resources<br />

and expertise – such as in risk modelling<br />

and asset pricing – in order to reduce the<br />

risk from extreme weather and maintain<br />

affordable insurance rates. Speaking<br />

at the first-ever Insuring Resilient and<br />

Sustainable Cities Summit at Resilient<br />

Cities <strong>2017</strong>, Oslo noted that after a period<br />

of trust building, the municipality and<br />

CITIES<br />


CITIES<br />

insurance partners found a way to share<br />

information for their mutual benefit. When<br />

local officials are better informed of their<br />

risk, they can take preventative measures<br />

that reduce damage and the need for<br />

insurance payouts.<br />

As risk managers, risk carriers<br />

and major institutional investors, the<br />

insurance sector is a natural partner to<br />

help cities assess and avoid risks, and<br />

invest in resilient infrastructure. Yet, as the<br />

previous example shows, even here work<br />

is needed to build effective public-private<br />

partnerships. ICLEI has teamed up with<br />

UNEP Principles of Sustainable Insurance<br />

initiative (UNEP PSI) in the largest<br />

collaboration between the insurance<br />

industry and cities to drive a long-term<br />

global action agenda. Our goals for <strong>2018</strong>,<br />

captured in the ‘Bonn Ambition’, are to<br />

create ‘insurance development goals<br />

for cities’, develop city-level sustainable<br />

insurance roadmaps, and organise<br />

dialogues between insurance industry<br />

CEOs and mayors, including at the <strong>2018</strong><br />

ICLEI World Congress. Early endorsers of<br />

the Bonn Ambition include Munich Re,<br />

the G7 <strong>Climate</strong> Risk Insurance Initiative<br />

(InsuResilience), Patricia Espinosa<br />

(UNFCCC) and the Mayors of Bonn,<br />

Germany; Iloilo City, Philippines; and<br />

Honiara City, Solomon Islands.<br />

Defining the real costs and long-term<br />

benefits of climate resilience is important<br />

to foster public-private partnerships.<br />

According to Swiss Re, global economic<br />

Mayors meet to discuss the local implementation of the Paris Agreement and 2030<br />

Sustainable Development Agenda during Resilient Cities <strong>2017</strong> in Bonn, Germany<br />

losses from disasters in 2016 totalled<br />

US$175 billion. Cities with resilient urban<br />

infrastructure systems and services<br />

suffer less damage and fewer interrupted<br />

business days from natural disasters.<br />

Low carbon and resilient solutions like<br />

green buildings deliver efficiency gains<br />

while contributing to long-term adaptive<br />

capacity. This may be why Puerto Rico<br />

is interested to ‘build back better’ after<br />

Hurricane Maria with renewable energy<br />

that reduces vulnerability to power outages.<br />

Considering that 60 per cent of urban areas<br />

in 2030 have yet to be built, there is a huge<br />

opportunity for all cities to choose similar<br />

resilient development pathways.<br />

Resilience gains are not all about<br />

avoided costs. Adaptation projects also<br />

generate direct and indirect revenue.<br />

Copyright: ICLEI <strong>2017</strong><br />

From the sample of adaptation actions<br />

mentioned previously, the number<br />

one co-benefit was ‘improved urban<br />

livelihoods’. Fifth was job and business<br />

creation, followed by energy security<br />

and supporting a green urban economy.<br />

Increased property values and supply<br />

chain security were also reported.<br />

The UNFCCC COP23 under the Fiji<br />

Presidency, hosted in Bonn’s Rheinaue<br />

park – a beautiful example of ecosystembased<br />

adaptation with far-reaching socioeconomic<br />

benefits – is the perfect venue<br />

to discuss resilient, low carbon solutions.<br />

ICLEI is engaged in a full programme<br />

showcasing climate action by cities, regions<br />

and small island states that contribute to<br />

nationally determined contributions and the<br />

global ambitions of the Paris Agreement.<br />

ICLEI AT COP 23<br />

Summit | Dialogues | Pavilion<br />

ICLEI is organising the <strong>Climate</strong><br />

Summit of Local and Regional<br />

Leaders. The City of Bonn and<br />

the State of North Rhine-<br />

Westphalia are co-hosts.<br />

We invite you to join us at the<br />

Cities & Regions Pavilion and<br />

look forward to partnering with<br />

leaders from all sectors toward<br />

the realisation of a low carbon,<br />

climate resilient urban future.<br />

Follow the action at<br />

citiesandregions.org<br />



CITIES<br />




CITIES<br />

Bosco Verticale in the Porta Nuova district of Milan, Italy<br />


CITIES<br />

Mark Watts,<br />

Executive Director of C40 Cities<br />

Shanghai skyline<br />

The shift towards a zero carbon<br />

economy is now irreversible and<br />

the lives of all the people on our<br />

wonderful planet are going to be improved<br />

as a result. That’s not to take progress for<br />

granted – we are very definitely at the<br />

mission-critical stage of needing to ramp<br />

up action to prevent run-away climate<br />

change. Global emissions really do need<br />

to peak by 2020, and we are nowhere near<br />

on track right now. The fact that the federal<br />

government in the United States is not<br />

going to be with us for the next three years<br />

is undoubtedly a huge setback. But I am<br />

confident we are going to get there, not least<br />

because non-state actors have stepped<br />

up to take leadership, and in particular the<br />

mayors of the big cities that C40 represents.<br />

At the C40 Mayors Summit in Mexico City<br />

in December 2016 we launched Deadline<br />

2020, the first significant route map for<br />

achieving the Paris Agreement, outlining<br />

the pace, scale and prioritisation of action<br />

needed by C40 member cities over the<br />

We need to ‘bend the curve’ of<br />

the emissions graph so that instead of<br />

an anticipated 35 per cent increase,<br />

emissions peak in 2020 and then start<br />

to fall sharply.<br />

next five years and beyond. A key finding<br />

of the report is that while achieving the<br />

ambition of the Paris Agreement to limit<br />

global temperature rise to below 1.5˚C will be<br />

incredibly tough, it is still technically possible.<br />

But by the end of 2020 each of the 91 cities in<br />

the C40 network will have in place a climate<br />

action plan that is consistent with limiting<br />

the global temperature rise to stay below the<br />

1.5˚C threshold. If all cities globally followed<br />

this example, then they could deliver 40 per<br />

cent of the emissions savings needed to<br />

achieve the Paris Agreement goals.<br />

Importantly, Deadline 2020 shows that the<br />

remaining global carbon budget – the total<br />

amount of emissions humans can risk putting<br />

in the atmosphere and still keep global<br />

temperature rise below 1.5˚C – is about 400<br />

gigatonnes for the rest of the 21st century. Of<br />

this, C40 cities are allocated 22 gigatonnes.<br />

At present, C40 cities emit 2.4 gigatonnes<br />

per year, so if they carried on at that rate the<br />

whole budget will be used up in less than<br />

a decade and by 2060, C40’s 91 cities alone<br />

will have used up the entire world’s carbon<br />

budget for the rest of this century.<br />


Mayors are currently<br />

much better placed to<br />

deliver collective global<br />

climate action than any<br />

other set of political leaders.<br />

CITIES<br />

If C40 cities are really to lead on delivering<br />

the Paris Agreement then we need to see a<br />

surge in climate action in the next few years.<br />

We need to ‘bend the curve’ of the emissions<br />

graph so that instead of an anticipated 35<br />

per cent increase, emissions peak in 2020<br />

and then start to fall sharply.<br />

Every single city needs to take radical<br />

action to move to a new low-carbon<br />

development path, with wealthier cities<br />

taking 70 per cent of actions between now<br />

and 2020; and lower income cities rapidly<br />

shifting to a low carbon development<br />

model so standards of living increase while<br />

emissions go down. There is no time to<br />

waste; indeed, in our model, 90 per cent of<br />

all the action C40 cities need to take to put<br />

the world on a climate-safe path needs to<br />

have happened by 2030.<br />

Deadline 2020 outlines what will need to<br />

have happened in cities in order to achieve<br />

these ambitious emissions reductions:<br />

• By 2020, nearly all C40 cities will have<br />

started building smart grids and energy<br />

storage, drastically reducing energy<br />

wastage.<br />

• By 2025, 75 per cent of buses in C40<br />

cities will be electric or other zero<br />

carbon, and every part of the city will be<br />

supported by mass transit, so we shall all<br />

be breathing cleaner air, enjoying quieter<br />

roads, and finding it easier to get around.<br />

• All new development will be transitoriented<br />

by 2030 and no mayor will be<br />

giving planning permission for new,<br />

sprawling suburbs that can only be<br />

accessed by car.<br />

• At the same time, waste pricing<br />

mechanisms will discourage the throwaway<br />

society.<br />

This sounds like a huge transformation<br />

– and it is. But delivering on the Paris<br />

Agreement is in every city’s self-interest.<br />

We already know from the work of the<br />

New <strong>Climate</strong> Economy that getting onto<br />

a low carbon development pathway will<br />

improve living standards faster and embed<br />

stronger and more sustained economic<br />

growth than the high carbon alternative.<br />

City leadership on climate change is<br />

essential, not least because the pledges<br />

made by presidents and prime ministers<br />

thus far would put the world on a<br />

path to between 2.5 and 3 degrees of<br />

warming, even without President Trump<br />

reneging on the US’s commitments.<br />

That figure is well within the zone that<br />

would spell disaster for large parts<br />

of the world and many of the world’s<br />

largest cities.<br />

Even as mayors, governors and<br />

business leaders are prepared to forge<br />

ahead, national commitments need to<br />

become more ambitious: if all are united<br />

on this issue we can make change that will<br />

resonate for generations.<br />

The leadership of cities and mayors is<br />

critical and it’s the mayors in office right<br />

now who hold in their hands the power to<br />

put the world on a low carbon path. Mayors<br />

are currently much better placed to deliver<br />

collective global climate action than any<br />

other set of political leaders. They are already<br />

convinced that we will build a much better<br />

world if we can constrain global temperature<br />

rise to below 1.5˚C – and they are acting<br />

upon it.<br />



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