Climate Action 2017-2018

COP23 | Bonn, Germany, 6-17 November 2017 

2017-2018 

In partnership with 

Published for 

E N D O 

R 

S 

E 

D 

E V E N T 

Frank Bainimarama 

on Fiji’s ambitions 

for the COP23 

Presidency 

Patricia Espinosa 

on sharpening 

climate action at 

COP23 

PLUS 

Exclusive interview 

with the World 

Energy Council & 

The 15 Climate 

Champions of 2017

WELCOME 

ISBN 

978-0-9928020-9-7 

Published 

November 2017 

Founder & CEO 

Nick Henry 

Commissioning Editor 

Jane Nethersole 

Editor 

Adam Wentworth 

Subeditor 

John Saunders 

Design 

Daniel Brown 

Printer 

Buxton Press 

The Publishers wish to thank all the 

individuals and organisations who have 

contributed to the book. In particular 

we acknowledge the following people 

from UN Environment for their help and 

advice in producing Climate Action: 

Erik Solheim, Naysan Sahba, Catherine 

Beltrandi, Sam Barratt and Samantha Le- 

Royal. UN Environment do not endorse 

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Climate Action has a well-established reputation for providing 

detailed insight from the world’s leading sustainability 

thinkers and policymakers. 

This 11th edition is no diff erent in off ering readers the latest ideas 

and developments in clean technology, environmental protection, 

climate finance and innovation that are vital to making the transition to 

a low-carbon economy. 

Two years ago, 196 member states signed the Paris Agreement, 

marking an historic success towards combatting climate change. The accord provides a 

major opportunity for countries to develop low-carbon strategies that will build truly modern 

and sustainable economies. The landmark deal, along with the newly agreed Sustainable 

Development Goals out to 2030, can provide the necessary push for countries to protect the 

environment and improve people’s lives. 

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

on the strength and cooperation which made the Paris Agreement such a success. The role 

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

a two degree scenario. Climate Action is particularly excited to be continuing our partnership 

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

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

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

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

bodies including Fiji, the African Union, France, UK, Denmark, Norway, Canada, and the 

European Commission. 

We hope you find the latest edition of Climate Action informative and engaging. 

Nick Henry, 

Founder & Chief Executive Off icer, Climate Action 

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1

CONTENTS 

WELCOME 

4 Erik Solheim, Executive 

Director, UN Environment 

8 Frank Bainimarama, 

Prime Minister of Fiji and 

President of COP23 

10 Barbara Hendricks, 

Minister for the Environment, 

Germany 

14 Climate Action’s 15 Climate 

Champions of 2017 

10 

32 High ambitions for France’s 

climate transition 

Nicolas Hulot, Minister for 

Ecological and Solidary Transition, 

France 

34 Electrifying Norway 

Vidar Helgesen, Minister of Climate 

and Environment, Norway 

36 The Danish way to green 

growth 

Lars Christian Lilleholt, Minister 

of Energy, Utilities and Climate, 

Denmark 

COP23 & BEYOND 

18 Sharpening climate action 

at COP23 

Patricia Espinosa, UNFCCC 

20 COP23: bringing 

Paris to life 

Nazhat Shameem Khan, 

Chief Negotiator for the COP23 

Presidency, Fiji 

23 Looking forward 

to COP24 

Jan Szyszko, Minister for the 

Environment, Poland 

POLICY 

26 Impact of U.S. withdrawal on 

the Paris Agreement 

Sue Biniaz, UN Foundation 

28 America pledges to fight 

climate change, with or 

without Washington 

Michael Bloomberg, UN Special 

Envoy for Cities and Climate 

Change 

20 

30 

40 Finland leads the transition 

towards a circular bio-economy 

Kimmo Tiilikainen, Minister of the 

Environment, Energy and Housing, 

Finland 

42 A low carbon future 

for the UK 

Claire Perry, Minister for Climate 

Change and Industry, UK 

44 Clean growth and climate 

action in Canada 

Catherine McKenna, 

Minister of Environment and 

Climate Change, Canada 

46 Women must be at the heart 

of climate action 

Isabella Lövin, Minister for 

International Development 

Cooperation and Climate, Sweden 

48 Disaster risk reduction and 

climate change 

Robert Glasser, UN Special 

Representative for Disaster Risk 

Reduction 

FINANCE 

30 Europe leads by example on 

climate action 

Jos Delbeke, Directorate- 

General for Climate Action, 

European Commission 

32 

52 Climate Action’s Sustainable 

Investment Forum 

54 Financing climate impacts in 

small island states 

Thoriq Ibrahim, Minister of 

Environment and Energy, Maldives 

2

56 $70 trillion global investment 

pool goes greener 

Andrew Steer, World Resources 

Institute 

58 Sustainable finance: the great 

acceleration 

Nick Robins, UN Environment 

Inquiry 

60 The importance of climaterelated 

financial disclosures 

Graeme Pitkethly, Task Force 

on Climate-related Financial 

Disclosures 

56 

ENERGY 

79 Decarbonising the energy 

sector 

Interview with Christoph Frei, 

World Energy Council 

84 Integrating renewables into 

our energy systems 

Christine Lins, REN21 

88 Africa’s renewable energy: 

challenges and opportunities 

Amani Abou-Zeid, African Union 

Commission 

CONTENTS 

62 Climate transparency in 

financial markets 

Remco Fischer, UNEP FI 

92 Are India’s renewable energy 

targets over ambitious? 

Leena Srivastava, TERI University 

64 Carbon pricing in the Paris 

Agreement era 

Richard Zechter, World Bank Group 

INNOVATION 

66 Climate Action’s Sustainable 

Innovation Forum 

68 Mission Innovation: 

accelerating the transition to 

a clean energy economy 

Patrick Child, European 

Commission 

71 Catalysing climate innovation 

in developing countries 

Anabel Gonzalez & Jonathan 

Coony, World Bank Group 

74 Innovative technologies 

provide the answer to climate 

change 

Roland Busch, Siemens AG 

76 1000 profitable solutions to 

solve climate change 

Bertrand Piccard, Solar Impulse 

Foundation 

79 

84 

109 

95 Catalysing affordable, reliable 

and efficient energy in the U.S. 

Daniel Simmons, U.S. Department 

of Energy 

TRANSPORT 

98 Decarbonising shipping – 

a challenge for all 

Kitack Lim, International Maritime 

Organization 

101 Accelerating the transition to 

electric vehicles 

Colin McKerracher, Bloomberg 

New Energy Finance 

104 A continued commitment to 

green innovation 

BMW Group 

CITIES 

106 Resilient cities: good for the 

climate and good for business 

Gino Van Begin, ICLEI – Local 

Governments for Sustainability 

109 Delivering concrete climate 

action in cities 

Mark Watts, C40 Cities 

3

WELCOME 

WELCOME 

Erik Solheim 

UN Environment Executive Director 

and Under-Secretary-General of the 

United Nations 

The Paris Agreement on Climate 

Change is a clear sign that nations 

can put their differences to one side 

and work together for the future benefit 

of people and planet. However, it is clear 

we need to do more and we need to do it 

faster; much faster. This edition of Climate 

Action shares thoughts from governments, 

businesses and academics on policies that 

can help make that happen, notably through 

the transition to a global green economy. 

Around the world, the media is full of 

headlines and dramatic images of extreme 

weather events, which are becoming 

more frequent and more serious. It’s 

a reminder that climate change is not 

something that will happen in the future; it 

is happening now. The human, economic 

and environmental cost is mounting fast. 

But another, closely connected tragedy 

is very quietly and steadily unfolding in 

the background, costing millions of lives 

and trillions of dollars. The same dirty 

transport, energy, refrigeration and waste 

that are pumping out greenhouse gas 

emissions around the planet, are pumping 

out pollution around its people. 

Take air pollution, which kills up to 

seven million people a year. In India, it 

is causing a significant rise in strokes, 

with women who breathe smoke from 

household cooking facing a 40 per cent 

higher risk. And, while strokes used to 

be considered a disease for the elderly, 

doctors like Praveen Gupta have seen 

the number of young stroke patients 

4

The world is responding in a 

myriad of ways that offer real hope 

and tangible solutions. 

WELCOME 

almost double in recent years. In fact, 

many stroke patients are only in their 

thirties and forties. 

In the face of such a challenge it is easy 

to be fatalistic, but the world is responding 

in a myriad of ways that offer real hope 

and tangible solutions. Countries, cities 

and citizens are taking action to support 

UN Environment’s BreatheLife, CleanSeas 

and BeatPollution campaigns. Government 

policies and the private sector are driving 

down the price of green technology like 

renewable energy, which now attracts 

investments of $300 billion a year and 

employs over 8 million people. The 

diversity of the solutions on offer is evident 

in the range of articles in this edition of 

Climate Action. From climate lawyer Sue 

Biniaz at the UN Foundation to Michael 

Bloomberg, the authors reflect the many 

voices rallying to mobilise green capital 

and prevent runaway climate change. 

Whether it’s the dramatic face of 

disaster that we see in the headlines or the 

very human face of suffering that Doctor 

Gupta sees every day in the hospital, there 

is no doubt that this must change. If the 

UN Climate Change conference in Bonn 

provides the perfect platform to agree the 

priorities for action, then the articles in 

Climate Action provide a timely reminder 

that we can and will deliver. I hope, that for 

public and private sector decision makers 

alike, it will provide new inspiration and 

build an even better future for this planet 

and its people. 

5

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WELCOME 

BULA VINAKA 

AND WELCOME 

TO BONN AND 

TO COP23 

Frank Bainimarama, Prime Minister 

of Fiji and President of COP23 

Fiji is proud to preside over COP23 

and, particularly, to count the 

Federal Republic of Germany, the 

State of North Rhine-Westphalia and 

the City of Bonn as our partners. When 

several friendly nations suggested at 

COP22 in Morocco that Fiji take on the 

Presidency of COP23, we found the idea 

both daunting and enticing. Daunting 

because it is a huge undertaking for a 

small country, and enticing because it 

gives us a chance to carry forward the 

perspective of all climate-vulnerable 

countries. 

Fiji is not a newcomer to the world 

stage. We may seem like a small, isolated 

country in the middle of the Pacific 

Ocean, nearly 5,000 kilometres from 

the nearest continent, but we are an 

outward-looking nation and have long 

had an internationalist perspective. 

Trade is important to us, our Pacific 

neighbourhood is important to us, and 

we welcome thousands of visitors to our 

shores each year. We also take seriously 

our role as a responsible member of the 

world community, and so we are among 

the world’s foremost contributors to 

United Nations peacekeeping operations. 

Now we have the chance - with the 

rest of the world - to rescue ourselves 

from the folly we have lived since the 

dawn of the industrial era. We can take 

concerted action to reduce greenhouse 

gases and limit global temperature rise 

to 1.5°C above pre-industrial levels. For 

8

WELCOME 

Now we have the chance - with the 

rest of the world - to rescue ourselves 

from the folly we have lived since the 

dawn of the industrial era. 

Fiji and other vulnerable and developing 

states, this is not just an ambitious 

goal. It is an imperative and a minimum 

achievement. Of course, it is no less 

important to developed countries and 

countries with large land areas, so 

we are pleased to see that virtually all 

nations are trying to put aside narrow 

interests to achieve a common good. We 

are engaged together in a noble effort, 

which will require constant effort and 

recommitment. We must succeed. 

9

WELCOME 

COP23 IN BONN: 

TOGETHER 

FOR CLIMATE 

SOLUTIONS 

Copyright-Hinweis: BMUB/Susie Knoll Farbraum 

Dr Barbara Hendricks, Federal 

Minister for the Environment, Nature 

Conservation, Building and Nuclear 

Safety, Germany 

The recent months have dramatically 

shown that the impacts of climate 

change can no longer be ignored. 

As the world warms up, tropical cyclones, 

for example, including the devastating 

Atlantic hurricanes we have witnessed this 

year, will probably get more intense and 

more common in coming decades. Here 

in Germany, too, the number of extreme 

weather events has more than tripled since 

the 1970s. 

Against this background, I am very 

glad that with Fiji, for the first time a Small 

Island Developing State has taken on the 

important role of the COP presidency. 

As a country particularly aff ected by the 

impacts of climate change, important 

topics such as adaptation to the impacts 

of climate change and resilience against 

climate change will be given a prominent 

role this year in Bonn. 

It is clear that we have to act now and 

rapidly to achieve the temperature goals 

set out in the Paris Agreement – to keep 

global warming to well below 2˚C, and 

to strive for 1.5˚C. 

Important steps on the road to this 

goal will be negotiated in Bonn. We will 

need to work on further elaborating the 

details regarding the implementation 

of the Paris Agreement, which will 

allow for the implementation guidelines 

to be adopted at COP24 next year in 

Poland, and to lay the groundwork for 

more ambitious climate action in the 

Facilitative Dialogue. 

While we negotiate these important 

aspects in Bonn, the transformation 

to a greenhouse-neutral and climate 

resilient world is well under way. These 

irreversible developments will be 

reflected in the COP’s new concept of 

10

WELCOME 

As technical 

host we are 

delighted to 

support the Fiji 

presidency and 

the UN Climate 

Change Secretariat 

in the planning and 

organisation of this 

conference. 

‘one conference – two zones’. One zone 

– the ‘BULA’ zone – will be dedicated to 

the negotiations, whereas the other – the 

BONN zone – will focus on action and 

implementation. The approach focuses 

on a close integration of the zones. We 

want to make sure that showcasing 

decisive climate action and concrete 

solutions for implementing the Paris 

Agreement will push the negotiations 

forward. 

Germany will also do its part: As 

technical host we are delighted to 

support the Fiji presidency and the 

UN Climate Change Secretariat in 

the planning and organisation of 

this conference. We will also present 

our national climate efforts: firstly, 

on how we implement the Climate 

Action Plan 2050 the German cabinet 

adopted in November 2016. The goal 

of this long-term strategy is largely to 

achieve greenhouse gas neutrality in 

Germany by 2050. It contains climate 

targets for individual sectors, providing 

guidance for strategic decisions in the 

years ahead. Secondly, the German 

government has also launched 

further initiatives at international 

level to encourage the reduction of 

CO 2 

emissions and adaptation to the 

impacts of climate change. Germany’s 

contribution has significantly increased 

and its commitments have grown more 

than fivefold since 2005. 

Our goal is to make the most of the 

momentum of the Paris Agreement in 

cooperation with our partners from all 

over the world. We know that we will 

only succeed by working together for 

solutions. I am therefore looking forward 

to welcoming all of you in Bonn. 

11

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FOR ZERO 

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Official partner of

CLIMATE CHAMPIONS 

CLIMATE 

ACTION’S 

15 CLIMATE 

CHAMPIONS 

OF 2017 

Climate Action has 

selected 15 Climate 

Champions that are leading 

the way towards innovative 

and scalable solutions to 

climate change. In this new 

feature, we are delighted to 

shine a spotlight on these 

governments, individuals, 

organisations, companies 

and cities - and hope 

that their dedication and 

passion for climate action 

will inspire others to follow. 

14

Frank Bainimarama 

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

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

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

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

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

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


Cape Town 

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

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

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

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

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

industries and initiatives. 

Jerry Brown 

The American politician and current Governor of California was designated the Special Envoy for States 

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

supported regional action, including co-leading the response to the US withdrawal by co-creating 

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

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

been a tireless and active voice for sustainability, recently announcing that California would host a 

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

with President Xi an agreement to work together to reduce carbon emissions. 

Pacific Islands 

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

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

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

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

of speeches from island leaders urging the international community to act quickly. Seven national 

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

and collective action”. 

France 

The election of Emmanuel Macron as President of France has helped reinvigorate French 

commitments to climate change. In response to the US withdrawal from the Paris Agreement, 

President Macron launched an initiative offering American scientists the opportunity to apply for 

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

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

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

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

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

15


Sweden 

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

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

will be offset by planting trees or sustainable investments abroad. Environment Minister and Deputy 

Prime Minister Isabella Lövin, who writes on gender in this edition of Climate Action, signed the law in 

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

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

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

António Guterres 

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

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

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

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

clear in connecting the recent number of catastrophic hurricanes to global warming, telling the UN 

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

events more severe and frequent”. 

ICLEI 

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

economies, areas and infrastructure. It has been instrumental in bringing together the Compact 

of Mayors to provide tangible commitments from cities to accelerate climate action and reduce 

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

Local and Regionally Determined Contributions in meeting the goals of the Paris Agreement. Gino 

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

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

ready to send that signal”. 

Bloomberg Philanthropies 

Michael Bloomberg’s charitable foundation had an active year supporting action against climate 

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

Breakthrough Energy Ventures is dedicated to investing in affordable and reliable zero-carbon 

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

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

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

against climate change. 

Angela Merkel 

Angela Merkel reaffirmed her credentials as the ‘Climate Chancellor’ this year by ensuring the lowcarbon 

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

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

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

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

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

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

Germany would reach its ambitious 2020 climate targets. 

16

London 

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

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

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

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

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

want to make London one of the greenest cities in the world”. 


Barcelona 

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

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

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

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

this number to encourage biodiversity, temper the microclimate and reduce the impacts from local 

flooding. 

Hakima El Haite 

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

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

Level Champion for Climate Action. At COP22, she helped launch the Marrakech Partnership for 

Global Climate Action, which is designed to accelerate the goals of the Paris Agreement. She has 

played an instrumental role over the past year in bringing together different parties to advance 

action on climate change. 

Mark Carney 

The Governor of the Bank of England has been central in promoting the role of finance in responding 

to the impacts of climate change. He was instrumental in the creation of the Task Force on Climaterelated 

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

by climate change on financial assets. This means that market participants and policymakers can 

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

solutions to climate change and sought to raise the profile, and viability, of green finance. 

The BMW Group 

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

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

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

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

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

scheme where older cars can be upgraded for a low-emissions vehicle. 

17


SHARPENING 

CLIMATE ACTION 

AT COP23 

Patricia Espinosa, Executive 

Secretary, UN Framework Convention 

on Climate Change (UNFCCC) 

The Paris vision demands 

that we rethink together the 

way we produce, use and 

consume energy, how we 

manufacture and build, how 

we manage our land and 

ecosystems. 

18

Hurricanes Harvey, Irma and Maria 

were just the latest stark warning 

that the world must cut out the 

greenhouse gas emissions that increase 

extreme weather, and build societies that 

can resist or recover quickly from the 

climate change that is already upon us. 

These three hurricanes in the Caribbean– 

US region have caused misery and hit 

the livelihoods of hundreds of thousands, 

while causing losses estimated upwards of 

US$350 billion – equal to the annual gross 

domestic product of a country like Egypt, 

Norway or Thailand. 

In South Asia alone, flooding this year 

has so far killed over 1,200 people, and 

triggered economic losses to countries 

and communities. That is why COP23 

will take the next essential steps to 

ensure that the Paris Climate Change 

Agreement meets its central goal: to 

prevent global temperatures rising beyond 

the point where human civilisation will 

be unable to cope with the impacts. The 

Agreement seeks to keep the average 

global temperature rise since the late 19th 

century well below 2˚C and as close to 

1.5˚C as possible. We have seen around 

one degree Celsius of this rise already, 

underlining the imperative to deliver 

results right now. 

Emissions need to peak fast and be 

dramatically cut thereafter until, as soon 

after 2050 as possible, they are so low 

they can be safely absorbed by natural 

systems like forests and soils or removed 

by available technology. 

The Agreement, coupled with the global 

Sustainable Development Goals under the 

UN, is a new, optimistic vision of the future 

where stable, secure livelihoods remain 

possible. The Paris vision demands that 

we rethink together the way we produce, 

use and consume energy, how we 

manufacture and build, how we manage 

our land and ecosystems. 

COP23, in Bonn, Germany, therefore 

has three main objectives. It will show 

how rising numbers of governments, 

cities, states, businesses, civil society 

and multilateral organisations are taking 

ambitious climate action and how new 

actors are continually coming on board. 

It must move further and faster now 

on how all these actors cooperate and 

coordinate together to make a much 

bigger united impact; especially in 

financing action. COP23 must make 

progress so that in 2018 governments 

complete the full set of operational ways 

and means under the Paris Agreement to 

help government and non-government 

actors alike meet the agreed goals to the 

best of their ability. 

Great advances continue to be made, 

showing the Paris Agreement is not a 

chain, broken by any weak political or 

economic link, but an ever deepening and 

widening web of influence and agreement. 

These are only a few of many, many 

examples: 

• China announces five pilot zones 

for ‘green finance’, where financial 

institutions will provide incentives to 

fast track green industries and new 

financing methods. 

• Several countries, including France 

and the U.K., announce dates when 

fossil fuel cars will be gone, replaced by 

electric vehicles. 

• Over 100 multinational companies 

pledge to source 100 per cent 

renewable energy for their operations 

under an initiative called RE100 by The 

Climate Group. 

• Over 250 US mayors commit to procure 

100 per cent renewable energy for their 

cities by 2035. 

• Moody’s reports green bond issuance 

worldwide could cross US$200 billion in 

2017, doubling the 2016 record. 

Sectors previously seen as latecomers 

to climate action are also moving. For 

example: 

• In cement (around 5-6 per cent of 

global emissions), HeidelbergCement in 

Germany and India’s Dalmia Cement are 

committed to reducing their greenhouse 

gas emissions. 

• In iron and steel (around 4 per cent), 

Sweden’s Vattenfall aims to use 

hydrogen instead of coal to become the 

first manufacturer of steel with almost 

no carbon dioxide. 

Meanwhile, much better coordination 

of climate action is now required among 

governments, cities, states, business 

and multilateral development banks and 

institutions. A country, company or citizen 

needs the most relevant, simple and timely 

channels to seize the major opportunities 

available in cutting emissions and 

protecting themselves against climate 

impacts and to access easily the 

technology and finance to do it. 

Insurance off ers a good example where 

uncoordinated action will never work 

because total risk must be dispersed 

among all. The poorest with no insurance 

suff er the worst. At COP23, we look 

forward to seeing how even greater 

coordination between governments and 

the insurance industry can increase the 

impact of the G7 InsuResilience plan to 

extend insurance to an additional 400 

million poor people worldwide. 

The third COP23 key objective is for 

governments to advance work on the full 

operating system of the Paris Agreement so 

that it is completed at COP24, in 2018. The 

need for such a system reflects the uniquely 

practical nature of the Paris Agreement – 

the only multilateral agreement backed with 

a set of concrete national plans to reduce 

emissions and build properly sustainable 

societies and economies. 

If that is all there was – a set of diverse 

promises to act on climate change – it 

would be impossible to assess whether 

the world was on track to meet the 

Agreement’s goals. The objective, 

therefore, is to deliver a comprehensive 

operating system to encourage, guide 

and report national and international 

climate action – to act further, faster, 

together – and to make a regular reality 

check in the coming decades on whether 

we are on track. 

This year’s COP23 is itself a welcome 

mirror of cooperation and coordination. 

The conference is organised by Bonnbased 

UN Climate Change, is presided 

over by the small, developing Pacific 

island state of Fiji as President, and is 

organisationally and logistically supported 

by G7 member Germany, with further 

support from the German state of North- 

Rhine-Westphalia and the City of Bonn. 

A central goal for the Fijian Presidency 

of COP23 is to forge this essential ‘Grand 

Coalition’ to accelerate climate action 

before 2020 and beyond. 

Further, faster, together in Bonn. 


19


COP23: 

BRINGING 

PARIS TO LIFE 

We bring an urgency 

to the process based on our 

experience and perspective 

as a small island country. 

Tropical cyclone Winston leaves a trail of destruction in Fiji last year 

20

H E Nazhat Shameem Khan, 

Chief Negotiator for the COP23 

Presidency, Fiji 

We meet at COP23 in Bonn with 

the global community at a 

crossroads in our collective 

response to climate change. The choices 

we make now will decide the fate of our 

planet and have a huge impact on the lives 

of all 7.5 billion people on earth. So it is vital 

that every global citizen is aware of what is 

at stake and what needs to be done. 

Fiji has assumed the role of the COP23 

presidency as the first Pacific Small Island 

Developing State to be given charge of 

the ongoing UN climate negotiations. I 

am often asked if this means COP23 will 

be a Pacific COP. My answer is this: while 

Fiji will preside over the negotiations on 

behalf of all countries, from all corners of 

globe, there is absolutely no doubt that we 

bring an urgency to the process based on 

our experience and perspective as a small 

island country. In doing so, we will give 

voice to the concerns and aspirations of 

one of the most climate vulnerable regions 

on earth. 

For us, the urgency is clear. In Fiji’s case, 

a tropical cyclone last year killed 44 of our 

loved ones, left many thousands of our 

people homeless and destroyed one-third 

of our GDP. Our neighbours in Vanuatu 

suff ered a similar disaster in 2015. And 

those of us living in vulnerable nations 

know the worst is yet to come. Indeed, 

three of our neighbours – Kiribati, Tuvalu 

and the Marshall Islands – face being 

submerged by the rising seas altogether. 

The stakes could not be higher. 

The Paris Agreement commits us to 

keeping the average global temperature 

well below two degrees over the industrial 

age and pursue eff orts to limit it to 1.5°C. 


21


Our game plan is 

this: To keep the global 

climate negotiations on 

track. To get everyone to 

fully implement the Paris 

Agreement and limit the 

global temperature to 1.5°C 

above that of the industrial 

age. And to get there, we 

will be reminding everyone 

of a very simple fact. We 

will only get there with 

teamwork. Every nation 

committing itself to climate 

action in the way that Fiji 

has. The citizens of the 

world coming together as 

one world – Team World – 

and doing what we must do 

to save our precious planet 

from the ravages of climate 

change. 

Frank Bainimarama, Prime Minister 

of Fiji and President of COP23 

The diplomacy and dialogue that led to 

this Agreement was one of the great feats 

of our age. But now it’s time to accelerate 

the pace and raise the ambition, because 

the evidence shows that we have no time 

to waste. Now it’s time for the hard work 

– to put words into action to bring Paris 

to life; otherwise the Agreement is just a 

piece of paper. 

It is no mystery that there have 

been significant shifts in the political 

environment since Fiji first assumed the 

role of the incoming Presidency last year. 

While we were of course disappointed by 

the decision of the Trump Administration, 

it is clear that the overall global desire to 

keep up the momentum and move forward 

with even greater ambition is unshakeable. 

In fact, we have been extremely 

encouraged by our consultations over the 

course of the year –with both parties and 

non-state actors – and have received very 

clear feedback on their desire for COP23 

to be a visionary COP. By this I mean 

a COP where outcomes are measured 

against their capacity to achieve the 

vision of the Paris Agreement: the vision 

of limiting global warming to 1.5°C, 

which is now the target for the world. 

Fiji is committed to this goal and we are 

determined to make progress at COP23 

that is balanced and shows a resolve 

Now it’s time to accelerate the 

pace and raise the ambition, because 

the evidence shows that we have no 

time to waste. 

that next year the negotiations are going 

to result in a set of guidelines that make 

Paris operational. 

To achieve this, we will rely on the Fijian 

concept of talanoa. This is a process of 

inclusive, participatory and transparent 

dialogue that builds empathy and leads 

to decision-making for the collective 

good. This concept is about listening to 

each other, learning from each other, and 

sharing stories, skills and experiences. We 

hope that by focusing on the benefits of 

action, we will be able to move the global 

climate agenda forward. 

As a symbol of our Presidency, we will 

be placing a Fijian ocean-going canoe 

– a drua – in the main foyer in Bonn. It 

is a reminder to the entire world that we 

are all in the same canoe when it comes 

to climate change. No-one is immune 

to its impact. And in the forthcoming 

negotiations, we must fill the sail of that 

canoe with a collective determination to 

move the climate action agenda forward. 

I appeal to every global citizen to join me 

on this journey for the sake of all humanity 

now and the generations to come. 

22

LOOKING 


FORWARD 

TO COP24 

Jan Szyszko, 

Minister for the 

Environment, 

Poland 

Planet Earth is the only home 

for human beings and we have 

to preserve it so that future 

generations can live here. In striving to 

achieve this, the Paris Agreement is one 

of the most important treaties of our time. 

Its core objectives and values – collective 

responsibility, sovereign contributions 

based on national circumstances, 

cooperation between all stakeholders – 

will lead us to the climate-neutral future 

we promised in Paris to current and future 

generations. With the necessary support for 

developing countries, strong cooperation, 

and an integrated and synergistic approach 

to other environmental conventions, this 

goal is within our reach. 

The recent tragic extreme weather 

events and the newest scientific reports 

prove the relevance of Paris Agreement 

goals, including the adaptation goal, and 

the urgency of action to achieve them. 

As nowadays no nation is fully immune 

to climate change impacts, it is in the 

interest of all, every community, 

to hold the increase of 

temperature to well below 

2°C compared with preindustrial 

levels, and to 

adapt our behaviour so 

that both human lives 

23


Credit: UMK/ A. Wiśniewski 

The venue for COP24 in Katowice, Poland 

24

In Katowice the treaty 

must become a living framework 

delivering its goals. 

and economies can be best protected 

against these impacts. We must cherish 

biodiversity, water and soil resources, which 

will continue to provide healthy food, natural 

resources and energy for all in the years to 

come. A clean and productive environment 

is a universal cornerstone of sustainable 

development and poverty eradication. 

The main and most pressing task ahead 

of all parties is the completion of the Paris 

Agreement Work Programme not later 

than COP24 in Katowice in December 

2018. It will require significant efforts 

of negotiators, supported by non-state 

actors, as well as strong political signals 

from the highest level. In Paris we adopted 

the treaty; a vast majority of countries – 

195 parties – have already signed it and 

ratified or significantly advanced domestic 

processes to do so. In Katowice the 

treaty must become a living framework 

delivering its goals. 

COP23, presided over by Fiji, will be an 

essential step towards successfully arriving 

at our final destination in Katowice for 

COP24. We need the firm leadership of the 

Fijian presidency, and good results from 

negotiations in all convention bodies. COP23 

in Bonn must be a success. This is a precondition 

of the success in 2018. Both Poland 

and I personally, as the future President of 

COP24, offer our Fijian friends and partners 

both political and expert support during the 

November conference in Bonn. 

2018 Facilitative Dialogue is another 

important event during COP24. The 

parties to the Agreement will for the 

first time have an opportunity to have 

a conversation about their Nationally 

Determined Contributions. They will gain 

better understanding of the objectives of 

other countries as well as understanding 

how cooperation may help to achieve 

their sovereign goals faster and better. 

Universal participation in the dialogue, 

and the engagement of countries in 

collaborative work, will strengthen a 

momentum for future global climate 

action, for building both institutional 

and human capacity in developing 

countries, mobilising climate finance 

as well as development and transfer of 

technologies. We truly believe that thanks 

to the consultations the Presidency of 

COP23 has been having in the course of 

2017, the design of the dialogue will best 

reflect the diverse views and expectations 

of the parties. 

The national sustainable development 

policy of Poland aims at balancing social, 

environmental and economic aspects, 

and includes efforts in many industrial 

sectors, including power as well as forestry, 

agriculture and municipalities. It is our 

primary political goal to ensure energy 

security and security of supply, and to avoid 

energy poverty. Poland is taking action to 

deploy clean coal technologies, to improve 

energy efficiency and reduce energy 

consumption without impeding the quality of 

life. We strive to increase emission removals 

by forest ecosystems and soils to help regain 

biodiversity and enhance ecosystem services 

to the society. District heating systems and 

promotion of climate neutral geothermal and 

biomass energy, improved insulation of public 

and private buildings or better resource 

management leading to implementation of 

circular economy underpin our continuous 

climate oriented endeavours. Our emissions 

have already peaked, almost 30 years ago, 

and since then continue to fall while the 

economy keeps growing. We are ready to 

share our experience with all parties now. We 

will be doing it during the Polish Presidency 

of COP24. 

COP23 in Bonn and COP24 in Katowice 

will be instrumental to maintaining and 

reinvigorating the 2015 political momentum. 

For this to happen, we need everybody 

on board – those who are already Parties 

to the Agreement, as well as other Parties 

to UNFCCC. Personally, I am convinced 

that climate action is an opportunity for 

every nation and the entire world for 

peaceful, sustainable development and 

improving the life standards of all people. 

Therefore, the adoption of Paris Agreement 

implementation package will mark the 

beginning of the better future for our only 

home – the Earth. 

The Former Secretary-General of the 

United Nations, Ban Ki-moon, said: “There 

is no plan B, as we do not have planet 

B.” I fully subscribe to this statement and 

encourage everybody to do even more, 

to make COP23 and COP24 the most 

successful COPs for all. 

25 

COP23 & BEYOND

POLICY 

IMPACT OF U.S. 

ON THE PARIS 

Sue Biniaz, Senior Fellow at the UN 

Foundation, and former Deputy Legal 

Adviser and lead climate lawyer at 

the U.S. State Department. 

26 

The Paris Agreement is noteworthy 

not only for addressing resilience 

but for being designed to be resilient 

itself. For environmental, economic and 

political reasons, the Agreement needed 

to attract broad participation, as well as 

maintain it over the long term. It includes 

many relevant features that may help 

insulate it from U.S. withdrawal. 

• Most significantly, the Agreement allows 

parties to design their own Nationally 

Determined Contributions (NDCs) based 

on their respective circumstances. 

Contributions are not negotiated with 

other countries or derived from a topdown 

directive. This approach invited 

wide participation at the outset and, in all 

likelihood, will help to maintain it. 

• Unlike the Kyoto Protocol, which required 

further negotiations and ratifications with 

respect to subsequent emissions targets, 

Paris is self-sustaining. Parties regularly 

update their contributions, without the need 

for negotiations or ratification processes 

that can be cumbersome and cause delays. 

• The Agreement will be successful only 

if, in the aggregate, ambition marches 

onward and upward. Otherwise, its global 

temperature goal cannot be realised. 

However, it recognises that, along the way, 

individual parties may face diff iculties, 

whether substantive or political. It therefore 

carefully combines provisions of a legally 

binding and a hortatory nature, and a Party 

need not exit the Agreement if it needs 

to change its contribution or if it cannot 

increase ambition in its next one. 

• While sub-national governments and 

other non-State actors cannot formally join 

the Agreement, the Paris outcome includes 

multiple ways in which they can take on 

commitments and otherwise participate in 

international climate action. 

It is unfortunate that the United States 

has expressed its intent to withdraw, despite 

the fact that the Agreement accommodated 

U.S. concerns, including with the Kyoto 

model. The Administration might have 

remained in the Agreement and stuck to 

the existing U.S. emissions target, even if it 

considered that it was unlikely to achieve 

it. Alternatively, it might have remained in 

the Agreement and adjusted the U.S. target, 

in a ‘nationally determined’ manner, to 

better reflect the Administration’s climate 

and energy policies. While many would 

probably have criticised such a move, it 

may also have been viewed as the less bad 

of two regrettable options. 

In any event, the question now is how 

resilient the Agreement will be, assuming 

U.S. withdrawal in 2020. 

• One issue is whether other countries 

will withdraw or be deterred from pursuing 

their existing NDCs as a result of the U.S. 

intent to withdraw. At least so far, this does 

not appear to be the case. The nationally 

determined nature of contributions may 

be one reason why countries continue to 

be committed to them – i.e. they designed 

their own NDCs irrespective of what 

other countries were committing to do. 

In addition, to the extent other countries 

are taking into account U.S. climate action 

in deciding on their own action, they are 

likely to look at the explosion in activity and 

commitments on the part of U.S. states, 

cities, businesses, and other non-federal 

actors. The Paris outcome, through various 

portals, platforms, and opportunities, has 

facilitated the ability of such actors to reflect 

the high level of domestic U.S. support for 

the Paris Agreement, and climate action 

more generally. Such support allows 

other countries to judge U.S. ambition in 

a manner that goes beyond the policies 

solely of the U.S. federal government. 

• A second issue is the extent to which 

U.S. withdrawal may aff ect other countries’ 

future action, including their NDCs. Here,

WITHDRAWAL 

AGREEMENT 

POLICY 

it is less clear what the impact of U.S. 

withdrawal will be, particularly if the 

absence from Paris is prolonged. As noted, 

the Agreement’s nationally determined 

approach provides parties with flexibility. 

Perhaps, again, irrespective of U.S. 

withdrawal, countries will focus on robust 

U.S. non-State action or determine, on other 

grounds, that it is in their interest to remain 

in the Agreement and continue taking 

ambitious climate action. 

• A third issue is what impact U.S. 

withdrawal may have on the various 

guidelines that the Agreement asks the 

CMA to adopt. Here, in the absence 

of strong U.S. engagement, special 

attention will need to be paid by others 

to maintaining the Paris Agreement’s 

essential balances regarding, for example, 

diff erentiation and bottom-up/top-down 

approaches. This will be important not only 

for preserving the Agreement’s integrity 

but, more specifically, in order to leave open 

the option for a future U.S. Administration to 

rejoin the Agreement. 

• Finally, it goes without saying that 

the leadership of the United States, 

along with that of many other players, 

was essential to securing the Paris 

Agreement and wide participation in it. 

A pro-Paris U.S. Administration would 

probably have devoted substantial 

diplomatic energy, as well as resources, 

to promoting climate-friendly policies 

around the world, including in 

developing countries. It is perhaps in 

this realm, without such leadership, that 

the resilience of the Paris Agreement will 

be most severely tested. 

In the absence of strong U.S. 

engagement, special attention 

will need to be paid by others to 

maintaining the Paris Agreement’s 

essential balances. 

27

POLICY 

AMERICA PLEDGES 

TO FIGHT CLIMATE 

CHANGE, WITH 

OR WITHOUT 

WASHINGTON 

Michael Bloomberg, UN Special 

Envoy for Cities and Climate Change 

and Co-Chair of America’s Pledge 

The United States has recently faced 

some of the most devastating 

hurricanes in our history, as well 

as one of the worst wildfire seasons in 

decades. Yet these are far from isolated 

incidents. Record floods recently killed 

more than a thousand people in India, 

Nepal, and Bangladesh. Hundreds were 

killed after torrential rains triggered a 

mudslide in Sierra Leone. While it is 

impossible to attribute any particular 

weather event to climate change, the 

science is clear: warming air and oceans 

are supercharging weather events around 

the globe. 

The Paris Climate Agreement was 

a breakthrough in global relations, 

and while President Trump has since 

announced that the US will pull out of the 

agreement in November 2020, the truth 

of the matter is that, when it comes to 

climate action in America, Washington 

will not have the last word. In fact, I am 

confident that the US will meet its Paris 

commitment – even without leadership 

from Congress or the President. 

There is good reason to be optimistic 

that we will: over the past decade, 

the US has led the world in reducing 

greenhouse gas emissions – and 

Washington had almost nothing 

to do with it. Congress passed no 

law to reduce emissions, and even 

before President Trump was elected, 

federal courts had placed on hold 

President Obama’s effort to place 

stricter emission controls on the 

power industry. America’s progress 

has been driven almost entirely by 

mayors and governors, who adopted 

All around the world, cities, regions, 

businesses, and citizens are taking a 

leading role in fighting climate change. 

28

Credit: Flickr 

POLICY 

Mike Bloomberg visits Brussels to meet 

with the Global Covenant of Mayors 

ambitious green agendas; business and 

technology leaders, who drove down the 

cost of alternative energy (both natural 

gas and renewables), invested in energy 

efficiency, and committed themselves to 

clean energy targets; and consumers, 

who led the way in shutting down nearly 

half of the US coal-fired power plants. 

In the wake of the President’s 

announcement last June, each of these 

groups came forward to re-affirm its 

support for the Paris agreement. Each 

recognises that it is in its own best interest 

to act, and the President’s decision has 

had the event of galvanising each to do 

more. To build on that momentum, and 

to show the world that Americans are 

determined to continue leading on climate 

change, California Governor Jerry Brown 

and I created America’s Pledge – an 

initiative to compile, quantify and track 

America’s efforts to dramatically reduce 

the nation’s carbon footprint. 

With this data, we will create a 

comprehensive report that can be 

compared to the Nationally Determined 

Contributions that every other nation 

submitted as part of the Paris Agreement. 

These reports will be made available to 

the UN and all the parties to the Paris 

Agreement – so that the world can still 

hold America accountable for meeting 

our targets. 

But America’s Pledge will do more 

than report on our progress. It will also 

empower climate leaders to be even 

more ambitious, by offering guidance that 

can help cities and companies finance 

green infrastructure while creating new 

jobs. It will also provide ideas on ways 

mayors and business leaders can make 

their cities more resilient to the climate 

impacts we know are coming. And it will 

help local officials develop policies that 

encourage investment in clean energy. 

When it 

comes to climate 

action in America, 

Washington will 

not have the last 

word. 

All around the world, cities, regions, 

businesses, and citizens are taking a 

leading role in fighting climate change 

– and that is as it should be. Cities are 

responsible for about 70 per cent of all 

greenhouse gas emissions. One of the 

best ways that national governments can 

fight climate change is to empower cities 

with greater authority over their buildings, 

energy sources and transport networks – 

and to help them access capital that can 

be used to finance investments in greener 

and cleaner infrastructure. 

Local leaders are acting because 

reducing emissions is not only good 

for the climate; it is also good for our 

health. When local governments clean 

their air, and when they invest in mass 

transit and parks, they make themselves 

more attractive places to live. And where 

people want to live, businesses want to 

invest. The future belongs to cities that 

embrace that idea. 

Ultimately, winning the war on climate 

change requires leadership from all 

nations, but it is important to remember 

that leadership is not confined to national 

capitals. In many countries, including 

the US, success will be driven from the 

ground up. 

29

POLICY 

EUROPE LEADS 

BY EXAMPLE ON 


Jos Delbeke, Director General, 

European Commission Directorate- 

General for Climate Action 

The European Union (EU) has long 

demonstrated global leadership 

on climate change, one of the 

greatest challenges of our time. In 

2016, together with countries round the 

world, we ratified the Paris Agreement, 

allowing its early entry into force. And 

yet the road to achieving our common 

goals may not always be smooth. Along 

with so many of our climate partners 

worldwide – nations, regional and local 

decision-makers, businesses, civil society 

groups and citizens – the EU did not 

hide its deep regret at the US President’s 

announcement this year to withdraw the 

US from the Paris Agreement. However, 

the international community has shown 

unity and resolve to follow through on 

the Paris objectives. The EU has made it 

very clear that the world can continue to 

count on our leadership and support. We 

are stepping up our partnerships around 

the world, to help build strong, sustainable 

economies and societies that are resilient 

to the impacts of climate change. 

What is now clear is that the EU is 

anything but alone – the global lowcarbon 

transition train has already left 

the station. Over 85 per cent of the 

Paris signatories have now ratified the 

The EU did not hide its deep regret 

at the US President’s announcement 

this year to withdraw the US from the 

Paris Agreement. 

Agreement and are getting on with 

implementation. Like us, they see Paris 

not only as a path for preserving the 

environment, but also the essential 

growth engine for our economies. The 

facts keep speaking for themselves: in 

2016, investment in renewables capacity 

outstripped investment in fossil fuel 

generation for the fifth year in a row; 

in each of the past three years, global 

economic growth was not accompanied 

by a rise in greenhouse gas emissions. 

This year’s UN climate conference 

(COP23) in Bonn, Germany, will be 

guided by the presidency of Fiji, the 

first small island state to have this role. 

We have important progress to make in 

Bonn. COP23 and the months that follow 

will be crucial for ensuring successful 

implementation of the Paris Agreement. 

By the end of 2018, when countries will 

gather for COP24 in Katowice, Poland, 

parties should adopt a work programme 

for Paris and take stock of our collective 

contributions to the Agreement, through 

the facilitative dialogue. 

The EU has arrived at COP23 with an 

important message to stakeholders across 

Europe and our global partners: we are 

getting on with the job at home. To ensure 

the EU meets its Paris pledge to reduce 

greenhouse gas emissions by at least 40 

per cent by 2030 compared with 1990, the 

European Commission has put forward a 

range of legislative proposals in the past 

couple of years, notably to make the EU 

emissions trading system (EU ETS) fit for 

2030, set member states 2030 emissions 

targets for non-ETS sectors and integrate 

greenhouse gas emissions and removals 

from land use and forestry into the EU’s 

30

climate and energy policy framework. 

These files are now being negotiated by the 

European Parliament and Council and we 

look forward to final agreements, so we can 

get legislation in place and therefore lay the 

foundations for reaching our 2030 goals. 

In Europe, we have a wide range of 

policies to drive and enable the shift 

towards a low-carbon economy. As part 

of our integrated Energy Union, we came 

forward late in 2016 with the Clean Energy 

for All Europeans package, which will 

give a strong push to the clean energy 

transition and create jobs and growth. 

It will adapt our regulatory framework 

to put energy efficiency first and foster 

the development of renewable energy. 

We have also put forward a proposal on 

governance, under which member states 

will have to prepare integrated climate and 

energy plans, to provide a clear picture 

of where we need to go, give investors 

certainty and help identify investments 

needed for the clean energy transition. 

We are also working to transform 

mobility in Europe and put the EU transport 

sector firmly on a path to sustainability. 

Following an ambitious set of proposals in 

May – the ‘Europe on the Move’ package – 

we have just this month put forward new 

CO 2 

emissions standards for cars and vans 

for 2021 onwards, to stimulate uptake of low 

and zero-emission vehicles. 

The EU’s experience of implementing 

ambitious climate and energy policies in 

the past two decades shows that such 

action pays off, economically as well 

as environmentally. It creates more and 

better jobs as well as bringing innovative 

technologies and more sustainable 

The Clean Energy for All 

Europeans package will give a strong 

push to the clean energy transition and 

create jobs and growth. 

products to the market. Today, the EU is the 

world’s most CO 2 

-efficient large economy, 

according to the European Environment 

Agency’s emission database (EDGAR). 

The strong engagement of businesses, 

civil society and cities and regions 

continues to be a cornerstone of European 

success in driving forward responses to 

climate change. And so is the committed 

support of our citizens, with a survey 

earlier this year showing that three 

quarters of Europeans see climate change 

as a very serious problem and eight in ten 

agree that fighting climate change and 

using energy more efficiently can boost 

the economy and create jobs. 

The extreme temperatures across Europe 

in summer 2017 were a stark reminder 

that we must also address the impacts 

of climate change. We are making good 

progress in implementing the EU Strategy 

on Adaptation to Climate Change and we 

continue to support non-state actors in as 

many ways as possible. Our partnerships 

already include countless businesses, cities, 

local authorities and communities that are 

committed to taking concrete action. 

The Covenant of Mayors for Climate and 

Energy, an alliance of local and regional 

authorities voluntarily committed to taking 

climate action and sharing experiences, 

has exceeded all expectations. Last year 

it went global, joining forces with the 

Compact of Mayors to create the Global 

Covenant of Mayors for Climate and 

Energy, and now counts over 7,600 cities. 

Now more than ever, the world is 

looking to Europe for climate leadership. 

So our task is to keep delivering and 

driving the low-carbon transition forward – 

leading by example. 

31 

POLICY

POLICY 

HIGH AMBITIONS 

FOR FRANCE’S 

CLIMATE 

TRANSITION 

Nicolas Hulot, 

Minister for Ecological 

and Solidary Transition, 

France 

Credit: A. Bouissou, French Ministry for Ecological and Solidary Transition 

All over our planet, climate 

disruption is throwing lives into 

disarray – particularly among the 

poorest and most vulnerable communities. 

The frequency with which extreme climate 

events are occurring has provided a 

startling glimpse of what could become 

the norm in the 21st century. 

Although the situation is extremely 

worrying, it is by no means irredeemable; 

in fact, all the tools we need to reverse this 

trend are already at our disposal. While 

humanity has spent decades living within 

a system that threatens our survival as a 

species, we are also capable of building a 

society that is more moderate and more 

sustainable, founded on the principles of 

solidarity – inclusive cooperation. COP21 

showed that it is possible to achieve what 

many believed to be unattainable: bringing 

world leaders together to build the first 

global climate agreement, and setting 

objectives that will bind us together over 

the coming decades. 

Today, the challenge we face is greater 

than ever. As political leaders, we are the 

guardians of the Paris Agreement. It is our 

responsibility to do all that is within our 

power to uphold our commitments, by 

coordinating the many stakeholders who 

have already been mobilised to combat 

climate change. This is the purpose of 

the Climate Plan, unveiled by the French 

government in July 2017. It aims to move 

32

faster and take our eff orts further with 

regard to climate change. The planned 

goal of reducing our country’s greenhouse 

gas emissions by 25 per cent was not 

suff iciently ambitious to meet the objectives 

set in December 2015. We are now aiming 

to achieve carbon neutrality by 2050. 

In order to do so, we must first move 

away from all activities with the potential 

to contribute to increased greenhouse 

gas emissions. With that in mind, the 

French Parliament is currently debating a 

bill that will bring an end to prospecting 

and extraction of both traditional and 

unconventional hydrocarbons. France 

has become the first country in the world 

to put forward a text that will initiate a 

progressive and irreversible end to oil and 

gas production within its borders by 2040. 

This ambition is just as evident in our aim 

to end the sale of petrol and diesel cars 

by 2040. The same is true for electricity 

production, for which we will cease using 

coal power plants by 2022. 

The transformations under way also 

represent a wealth of opportunity for 

companies active in the green economy. 

Conditions have never been so favourable: 

the renewable energy sector is progressing 

at an unprecedented rate, technological 

advances are allowing us to build homes 

that consume little to no energy, and more 

and more people are choosing to use clean 

methods of transport. Our citizens are 

aware of the threat that faces them, and are 

refusing to accept consumption methods 

that endanger their environment, their 

health and their future. 

We are determined to support all those 

who are working to stimulate innovation 

and advance our scientific understanding. 

To encourage climate research, the French 

president has already launched a platform 

– entitled ‘Make our planet great again’ – 

for the most promising projects. Because 

our future solutions are inherently linked to 

scientific advances, France will be hosting 

the 47th plenary session of the IPCC in the 

spring of 2018. 

We will also be working to promote 

the concept of green financing. Our 

ambition is to put France at the centre of 

a movement to improve the way in which 

climate risks are taken into consideration 

in financial regulations. With its law on 

Energy Transition for Green Growth, 

France has become the first country in 

the world to require investors to publish 

information on how their investment 

policies take into account environmental 

criteria, social factors and quality of 

governance. We will also encourage our 

European and international partners to 

adopt the same approach. 

Finally, we wish to support all business 

sectors that will drive the evolution of 

France 

has become the 

first country in 

the world to put 

forward a text 

that will initiate a 

progressive and 

irreversible end 

to oil and gas 

production within 

its borders by 

2040. 

Credit: A. Bouissou, Terra, MTES 

our economy. I refer in particular to the 

circular economy, which accounts for 

over 800,000 jobs in France. Economic 

prospects are highly encouraging: 

recycling a tonne of waste generates 

30 times more jobs than sending it to 

landfill. We are currently working on a 

roadmap for the circular economy, which 

will be published in 2018 and will give real 

momentum to the pursuit of sustainable 

production and consumption. 

This is France’s vision for solidarity and 

ecological transition. This transition is 

for everyone, and will require everyone’s 

involvement. Companies and investors, 

as drivers of innovation, also have a role 

to play in this approach. Our objective is 

three-fold: to bring an end to excessive 

depletion of our natural resources, to 

direct capital towards economic activities 

that are compatible with our climate 

commitments, and to propose adaptive 

solutions that will protect our communities 

from climate-related disasters. 

We expressed this vision at the 

recent UN General Assembly with the 

presentation of the proposed Global Pact 

for the Environment, which will serve as a 

basis for environmental rights throughout 

the international community. Over the 

course of COP23, the upcoming Climate 

Summit in December 2017, and beyond, 

we will continue to place solidarity firmly 

at the centre of our ambitions for our 

society. 

POLICY 

33

POLICY 

ELECTRIFYING 

NORWAY 

Vidar Helgesen, Minister of Climate 

and Environment, Norway 

What strikes foreigners on 

the streets of Oslo is the 

large number of Teslas and 

other electric vehicles. Norway sells 

the highest proportion of electric cars 

in the world relative to the number of 

inhabitants. Recently we celebrated 

100,000 electric cars on Norwegian 

roads, and if one looks at the most 

popular models in the first half of 2017, 

one has to look to the 10th spot to find a 

conventional fossil-fuelled car. 

In June 2017, the share of electric in new 

car sales was 27.7 per cent. For the first 

time, more electric and hybrid cars were 

sold than diesel and gasoline cars. Our 

electric cars policy attracts interest from 

international media as well as politicians. 

It might seem a paradox that Norway, 

as a large oil and gas exporter, does 

its best to reduce the use of fossil fuels 

in transportation. Norway is, however, 

blessed with both renewable and fossil 

resources. While we export most of the 

oil and gas, domestic power generation is 

based on renewable energy sources. This 

is, indeed, a unique situation, which we 

will build upon in our policy to create a 

low emission society. 

During the last hundred years, 

hydropower has paved the way for the 

Norwegian economic and industrial 

development. Small local rivers 

brought power to small enterprises 

and households. In addition, we have 

developed large hydropower projects 

that have made energy-intensive industry 

in Norway a success. The renewable 

share of the power generation mix 

is 98 per cent, where 96.5 per cent 

comes from hydropower. In Norway, 

we have large hydropower reservoirs 

and interconnectors to Sweden and the 

Continent, allowing us to offer the Nordic 

and European power markets backup 

capacity when needed. The hydropower 

system works very well together with 

variable renewable energy sources like 

wind power and solar PV. 

Heating and transport still depend 

on fossil fuels, and the total renewable 

energy share in Norway is 69 per cent, 

calculated in accordance with the EU 

Renewable Directive. We will continue 

our efforts to increase the use of 

renewables in heating and transport. Use 

of oil for heating will be phased out. We 

have started electrifying Norway with 

renewable energy sources. 

The transport sector is key in reducing 

greenhouse gases and increased energy 

efficiency. Our technology shift to electric 

cars is being achieved by offering 

generous incentives. The problem right 

All around the world, cities, 

regions, businesses, and citizens 

are taking a leading role in fighting 

climate change. 

Hydropower is the dominant source of 

power generation in Norway 

34

POLICY 

Norway sells the highest proportion of electric cars in 

the world relative to the number of inhabitants. 

now is to build charging stations fast 

enough to keep pace with the sale of 

electric cars. We have also supported 

electric driven ferries. Today, more than 

50 battery electric or hybrid electric car 

ferries are either in the planning process 

or in construction in Norway. Electric 

ferries will become a normal sight in the 

coming years. The technology shift goes 

very fast. We are already seeing plans 

for electric driven trucks, ships and even 

short-distance aeroplanes. 

Reduced costs of renewable energy, 

in particular solar PV and wind power, 

and reduced battery costs, are spurring 

a very fast deployment of renewable 

energy. Norway has installed rooftop 

solar PV to charge the electric trucks. 

We shall certainly see more examples 

as soon as business actors realise 

opportunities. 

According to the IEA/IRENA report 

Perspectives for the Energy Transition, 

launched in March 2017, energy efficiency 

will be the most important energy 

measure to achieve the long-term 

temperature goal of the Paris Agreement. 

Norway is one of the front runners 

when it comes to building codes. The 

government has supported large energy 

efficiency projects in energy intensive 

industries. Digitalisation and energy 

saving technologies, such as LEDs, 

With almost 100 per cent 

renewable power generation and our 

policy on energy efficiency, heating 

and transport, it should be possible 

to achieve a close to 100 per cent 

renewable share in the energy mix. 

offer numerous opportunities to reduce 

energy consumption and greenhouse 

gas emissions. Taking advantage of 

digitalisation opportunities and disruptive 

technologies will be part of green 

transformation in Norway. 

Exploration of oil and gas in Norway 

will not last for ever. Other sectors and 

business opportunities must replace 

the oil and gas sector when it comes 

to value creation and employment. The 

government has published a strategy 

on green competiveness, and we 

will follow up the roadmaps for a low 

emission future from as many as 15 

different sectors. It is encouraging to 

see the enthusiasm driving this vision of 

business opportunities combined with 

low emissions. 

With almost 100 per cent renewable 

power generation and our policy on 

energy efficiency, heating and transport, 

it should be possible to achieve a close 

to 100 per cent renewable share in the 

energy mix. Moreover, our export of 

renewable energy can contribute to an 

increased share of renewable energy in 

the power generation in other countries. 

Our policy to incentivise use of electric 

cars has already encouraged car 

manufactures to develop electric cars and 

launch new models in Norway. Teslas and 

other electric cars will be a more common 

sight in cities worldwide in the future. 

35

POLICY 

THE DANISH 

WAY TO 

GREEN 

GROWTH 

36

Lars Christian Lilleholt, Minister of 

Energy, Utilities and Climate, Denmark 

Since 1990 Denmark has cut 

its greenhouse gas emissions 

by 27 per cent, kept its energy 

consumption constant and still managed 

to increase its GDP significantly. Last year 

alone, the World Energy Council, the World 

Bank and the Cleantech Group published 

reports ranking Denmark as one of the 

world’s top performers when it comes 

to framework conditions for renewable 

energy investments and the ability to 

develop new clean-tech companies. 

Of course, these top results have not 

appeared out of nothing. Instead, they 

have been fostered through decades of 

hard work finding cost-eff ective solutions 

to limit the risks of global climate change 

and to seize the opportunities that follow 

the green transition. 

There are six main reasons for 

Denmark’s success. First, the overarching 

and long-term policy decisions for Danish 

energy have been characterised by broad 

political agreement between most parties 

in Parliament since the 1970s. This creates 

political stability, which is essential to 

investors who think for the long term. 

The current Danish government has set 

ambitious long-term goals, thus continuing 

this tradition. It is the government’s goal 

to cover at least half of Denmark’s total 

energy needs with renewable energy in 

2030 and to make Denmark independent 

of fossil fuels by 2050. 

Second, via a market-based approach 

to financial incentives, Denmark has 

advanced development in clean energy 

technology development, improved 

Credit: State of Green POLICY 

37

POLICY 

It is a key aim to work for a 

European electricity market which 

is integrated, market-based, and 

incentivises flexibility both on the 

supply and demand side. 

competition within the clean energy sector 

and lowered the costs of energy. Right 

now, wind power accounts for more than 

40 per cent of the Danish final electricity 

consumption, expected to rise to about 50 

per cent by 2020, owing to the significant 

onshore and offshore developments since 

2012. In the future, however, we must 

continue to develop a regulatory setup 

that can ensure a market-based path to 

further clean energy development. 

Denmark has a wealth of experience 

with very effective tendering procedures. 

At the end of 2016, Denmark held a tender 

for the new 600MW offshore wind farm 

Kriegers Flak. The tender was won by a 

bid of only five euro cents per kWh, a new 

world record at the time. In September 

2017 the government went further along 

the path to market-based solutions for 

renewable energy sources, reaching an 

agreement on partially technology-neutral 

tenders with wind and solar PV for 2018 

Credit: State of Green 

38 

and 2019 for a combined DKr1 billion. 

Third, good conditions for research 

demonstration and development have 

been vital for the continued development 

of clean and more effective technologies. 

For example, at the Danish national test 

centres for wind turbines in Østerild 

and Høvsøre, which the government 

recently agreed to expand, we are 

fostering close cooperation between 

Danish universities and the wind power 

industry. The test centres encourage the 

increased development and production 

of wind power technology in Denmark, 

which is consistent with the government’s 

ambition of maintaining and nursing the 

best possible framework conditions for the 

renewable energy industry. In this way, we 

can fulfil our ambition of covering at least 

50 per cent of our energy needs in 2030 

from renewable energy. 

Furthermore, Denmark is part of Mission 

Innovation (MI) and we are committed 

Credit: State of Green 

to doubling public investments in clean 

energy research development over a 

five-year period, and to opening up the 

Danish Programme of Development and 

Demonstration of Energy Technology 

to foreign investors. This is good news 

for Denmark and the global climate, but 

equally good news for other MI members 

who can profit from cooperation and 

investment opportunities. 

Fourth, Denmark benefits from 

being part of a well-functioning and 

liberalised electricity market which is 

highly integrated with our neighbouring 

countries. Consequently, the wholesale 

price of electricity in Denmark is the 

same as in at least one neighbour 

country 90 per cent of the time. When 

the wind blows in Denmark, Danish 

electricity is sold to Norway, Sweden 

and Germany and, conversely, when the 

wind is not blowing, Norway can export 

electricity back to Denmark. This ensures 

security of supply, supports a high level

POLICY 

The export of energy technology 

makes up around 11 per cent of 

Denmark’s total exports of goods, one 

of the highest shares in Europe. 

of integration of renewable energy into 

the electricity market, and provides low 

prices for the consumers. 

Our cooperation with our neighbouring 

countries underlines the fact that national 

energy frameworks cannot stand alone. 

Large-scale penetration of renewable 

energy is most effectively happening by 

maximising the geographical area for 

balancing across borders, so weatherdependent 

production patterns can 

complement each other. To that end, it is a 

key aim to work for a European electricity 

market which is integrated, market-based, 

and incentivises flexibility both on the 

supply and demand side. 

Fifth, Denmark is actively committed 

to sharing experience with the rest of the 

world. As a consequence, Denmark has 

government-to-government cooperation 

with 12 countries across the globe with a 

focus on wind power production, energy 

efficiency, district heating and intelligent 

energy planning. The same is true for our 

work in multilateral organisations where 

Denmark actively seeks to exchange best 

practice on these topics where the country 

has valuable experience to share. 

Sixth, these effects have helped 

develop a highly competitive energy 

technology sector in Demark. As a result, 

the clean energy transition has gone 

hand in hand with strong exports and 

economic growth. The export of energy 

technology makes up around 11 per cent 

of Denmark’s total exports of goods, one 

of the highest shares in Europe. 

It is, however, too soon to fully enjoy the 

fruits of our labour. The Paris Agreement 

sets the direction for a green transition 

and sends a strong signal to both civil 

society and the private sector that the 

world is moving in a green direction. To 

achieve the goals of the Paris Agreement, 

investments in the green transition 

are imperative. We should use this as 

an opportunity to share our valuable 

experiences and competences. 

39

POLICY 

FINLAND LEADS 

THE TRANSITION 

TOWARDS A 

CIRCULAR 

BIO-ECONOMY 

Kimmo Tiilikainen, Minister of the 

Environment, Energy and Housing, 

Finland 

40 

Teemu Kuusimurto / Environmental Administration 

We live in an era where the linear 

economic model has come to 

its end, and the world has to 

move towards a revolutionary circular 

economy where the value of materials 

and products is maximised and kept in 

use for as long as possible. In Finland 

we aim to lead this progress by example 

and to create solutions to the global 

sustainability crisis. 

In the coming decades we will need 

more of everything based on natural 

resources globally: food, feed, water, 

energy, materials and space. At the same 

time the global capacities to produce 

these resources sustainably are severely 

exceeded. In this situation, the basic 

principles of the circular economy 

– reuse, recycle, remanufacture and 

repair – provide the key for a sustainable 

future. We need a paradigm change to an 

economy where waste is regarded as a 

valuable resource and production takes 

giant leaps towards more eff icient use of 

resources; to an economy where people 

circulate and share materials, services, 

technologies, solutions and ideas. 

We need a transition from a pipeline 

economy to a circular economy. 

Until recently, the role of renewable 

resources has been hidden behind the 

main façade of circular economy. This is 

particularly noticeable in Finland, where 

we have significant forest resources, 

and eff ective tools and the requisite 

knowledge for managing and using 

them sustainably. In many countries and 

even continents bio-resources are not 

similarly in focus, despite substantial 

capacities for sustainable bio-production.

We are testing new 

solutions, particularly for 

sustainable food systems, 

timber construction, 

recycling of municipal 

waste and rehabilitation of 

contaminated land. 

The reason for this can be an abundance 

of non-renewable resources as well as 

technological solutions and economic 

structures, which are not fit for sustainable 

use of renewables. 

However, a transition from a fossil 

economy to a bio-based economy is also 

essential for a sustainable future. We need 

to combine the sustainable use of biobased 

renewable resources and ‘carbon 

cycles’ with a circular economy. And this 

brings us to a circular bio-economy. 

‘Bio-economy’ refers to an economy 

that relies on renewable natural resources 

to produce food, energy, products and 

services. A bio-economy strives to 

reduce our dependency on fossil and 

non-renewable natural resources. In 

transitioning towards bio-economy 

we must respect the limits of natural 

capacities and work along the principles 

of a circular economy. A sustainable 

bio-economy also has respect for 

biodiversity and the recreational values 

that our planet and nature off er us. It 

aims to increase our understanding 

of how dependent we are on nature, 

natural resources and their sustainable 

management. 

In climate policy, Finland is strongly 

committed to the Paris Climate 

Agreement. We are determined to build 

a carbon neutral Finland by 2045 and 

to do our share in balancing global 

emissions and carbon sinks in the 

second half of the century. The circular 

bio-economy plays an important role in 

this work. 

Finland’s aim is to lead the transition 

towards a circular bio-economy by 

example and concrete measures. We 

are testing new solutions, particularly 

for sustainable food systems, timber 

construction, recycling of municipal 

waste and rehabilitation of contaminated 

land. In addition, the circular economy 

roadmap for Finland, developed by 

the Finnish Innovation Fund Sitra in 

co-operation with key ministries and 

stakeholders, includes more than 60 

concrete projects and administrative 

measures that support the concept of 

circular economy. 

In our national Sustainable Urban 

Development programme we are focusing 

in particular on low carbon, resourceeff 

icient and smart services as well as 

promoting equality and social cohesion. 

The programme also aims to enhance 

environmentally and socially sustainable 

solutions and strengthen business based 

on them. In addition, the government 

supports urban circular economy and 

cleantech initiatives and pioneering 

networks, such as the Smart and Clean 

Foundation in the Helsinki Metropolitan 

Area, the wide networks of Finnish 

Sustainable Communities (FISU) and 

Carbon Neutral communities (HINKU). 

We manage our forests, waters and 

other natural resources wisely and 

sustainably. After all, nature and forests 

are our national treasures – and close 

to the hearts of Finns. Despite rising 

investments in the forest industry and 

increasing use of wood, the growth of 

forests in Finland exceeds the amount 

harvested. With sustainable forest 

management that promotes forest 

growth and respects biodiversity, our 

carbon sinks remain significant and we 

are able to benefit from renewable raw 

materials and energy for developing a 

circular bio-economy. This also supports 

the active role of forests in combating 

climate change, as envisaged in the Paris 

Agreement. 

We must all be a part of the change. We 

need to make more sustainable choices as 

consumers – for example at the grocery 

store – and make the most of shared 

ownership and low-carbon living. But 

most importantly, we need a revolution 

in the way we think about the economy. 

This change in our mindset, together 

with bold policy measures and innovative 

businesses, will foster the paradigm 

change from fossil, pipeline economy to a 

circular bio-economy. 

41 

POLICY

POLICY 

A LOW 

CARBON 

FUTURE FOR 

THE UK 

Claire Perry, Minister for Climate 

Change and Industry, UK 

The UK is unequivocally committed 

to a low carbon future. We were, 

after all, the first country in the 

world to introduce a statutory Climate 

Change Act which binds us to five-year 

carbon budgets and holds us to cutting 

our harmful greenhouse gas emissions by 

at least 80 per cent by 2050. 

Since 1990, our economy has grown 

by 67 per cent and, at the same time, we 

have managed to reduce emissions by 42 

per cent – the best performance of any G7 

country. The latest research shows that the 

UK was the fastest of any country in the 

G20 to decarbonise last year. 

Our low carbon economy is growing 

rapidly and something we are determined 

to build on and take advantage of as part 

of the UK’s industrial strategy. Analysis 

produced for the Committee on Climate 

Change estimated that the low carbon 

economy could grow 11 per cent a year 

from now until 2030. In just 13 years, we 

could see up to two million more UK jobs 

in this sector. Because of the excellent 

progress we are making I believe the 

UK can lead the world in creating clean 

technology jobs and businesses. 

In October 2017, the UK government 

published the Clean Growth Strategy. This 

blueprint for a low carbon future will sit 

at the heart of our industrial strategy. It 

aims to help British businesses increase 

their energy productivity by at least 20 

per cent by 2030. It will ensure large 

companies cut their bills, through an 

industrial energy efficiency scheme, and 

provide international leadership in carbon 

We must ensure that British 

businesses, innovators and 

entrepreneurs also take full advantage 

of the huge, global economic 

opportunities this future brings. 

42

POLICY 

capture, usage and storage. We know this 

technology holds promise and that the 

costs need to come down – we intend to 

lead that challenge. 

Our Clean Growth Strategy will also 

make our homes warmer and cheaper to 

run with about £3.6 billion (US$4.75 billion) 

to upgrade around one million homes 

through the Energy Company Obligation. 

On our roads, our strategy will help reduce 

air pollution by increasing the number 

of electric vehicles and creating the best 

charging infrastructure in Europe. On top 

of this, we will end the sale of new petrol 

and diesel cars in our country by 2040. 

Across the piece, we are spending 

£2.5 billion (US$3.3 billion) in innovation 

to support the transition to a low carbon 

economy – a strong symbol of our 

commitment to a low carbon future in 

the UK. 

From our point of view in government, 

this is a win-win: we continue to cut 

emissions and in doing so also cut 

consumer bills, drive economic growth, 

create high-value jobs and improve 

our quality of life. But just having the 

On our roads, our strategy will 

help reduce air pollution by increasing 

the number of electric vehicles 

and creating the best charging 

infrastructure in Europe. 

government commit to a low carbon future 

for the UK is not enough. We must ensure 

that British businesses, innovators and 

entrepreneurs also take full advantage of 

the huge, global economic opportunities 

this future brings. That is why we have 

committed to the largest increase in 

public spending for investment in science, 

research and innovation in almost 40 years. 

With the signing of the Paris climate 

agreement – in which UK leadership 

played a pivotal role – there is an 

unstoppable global shift towards clean 

technologies, infrastructure, industry and 

jobs. It is critical that the international 

community is fully behind this shift. We 

need to make sure all countries maintain 

their progress towards meeting the longterm 

goals in the Paris agreement. 

As the UK Prime Minister, Theresa May, 

said in the Clean Growth Strategy: “Clean 

growth is not an option, but a duty we owe 

to the next generation.” There is a long way 

to go, but I am confident that we are on 

the right path and that the UK can help 

lead the world down it. 

43

POLICY 

The Arctic is heating up 

twice as fast as the rest of the 

planet, with perilous impacts. 

CLEAN 

GROWTH 

AND CLIMATE 

ACTION IN 

CANADA 

44

Catherine McKenna, 

Minister of Environment and 

Climate Change, Canada 

Canada’s Arctic is a place of 

stunning beauty. It is found within 

an expanse of sprawling tundra, 

blue oceans, and biodiversity that includes 

beluga and bowhead whales and polar 

bears. It is also an area under severe threat 

from the ravages of climate change. Today 

the Arctic is heating up twice as fast as the 

rest of the planet, with perilous impacts. 

During an expedition I took north 

this summer I heard from a young Inuit 

teenager. He told me of the problems 

facing his community: melting permafrost, 

thinning polar bears and disappearing 

caribou. Other Inuit described hunters 

falling through melting sea ice – events 

that are altering the way they have hunted 

since time immemorial. 

It is because of these impacts – and the 

eff ects of climate change we see globally – 

that the world is taking action. 

In 2015, Canada and close to 200 other 

countries signed on to the Paris Agreement; 

and in doing so, committed to prevent 

global average temperatures from rising 

above 2°C, while striving to keep it below 

1.5°C. But to accomplish this, to ensure a 

better world for future generations, we must 

ratchet up our ambition. 

In Canada, we are working hard to do 

our part. In 2016, together with provincial, 

territorial and indigenous leaders, I 

announced our made-in-Canada climate 

plan – a plan to reduce our carbon 

emissions, spark innovation and create well- 

paying jobs. This is a plan that will ensure a 

healthy environment and a strong economy. 

In the 21st century, it is no longer 

acceptable to pollute for free and send 

the tab to the next generation. In Canada 

we will soon be pricing carbon emissions 

across our entire country. We are putting 

a price on what we don’t want – pollution 

– and investing the revenue in things we 

do want, such as clean energy, public 

transport, and more good jobs. Already 80 

per cent of Canadians live in a province 

that prices carbon emissions. 

Of course, pricing pollution is just one 

action needed to address climate change. 

To further reduce our emissions and 

foster clean growth, we are improving our 

public transport, constructing buildings 

that waste less energy, and supporting 

businesses to develop clean technologies. 

In fact, Canada is quickly becoming a 

major competitor in the renewable-energy 

and cleantech industries. Earlier this year, 

11 of Canada’s cleantech companies were 

ranked within the top 100 in the world. 

Companies like Carbon Cure are taking 

emissions from factories and injecting 

them into cement, making it stronger 

and cheaper. And companies like Ballard 

Power are creating fuel cells used in zero 

emission vehicles around the world. 

Canadians understand that transitioning 

to clean growth is good for the environment 

and the economy; that hundreds of billions 

During a kayak trip to Nunavut, Catherine McKenna announced 

the expansion of Canada’s largest national marine conservation 

area (NMCA) in Lancaster Sound (Tallurutiup Imanga). She is 

pictured with Moosa Akavak, an Inuit leader from Nunavut. 

of dollars are already being invested 

globally – to spark new technologies and 

drive new possibilities; and that innovators, 

engineers and entrepreneurs are catalysing 

the market of tomorrow. 

We also know that clean solutions 

support healthier communities. That 

is why we are phasing out coal-fired 

electricity by 2030. We know that 

clearing smog from our skies will 

prevent cases of asthma, reduce hospital 

bills and emergency room visits, and 

save lives. It will also reduce greenhouse 

gas emissions by 5 million tonnes a year, 

the equivalent of taking 1.3 million cars 

off the road. 

When I think of the urgent need to 

tackle climate change, I keep coming 

back to my visit to Canada’s Arctic. Young 

Inuit described to me their love for the 

land and sea: the majestic ice flows, 

roaming caribou, and teeming fish found 

throughout. And they told me of the 

urgency to protect their home from the 

threats of climate change. 

So as we gather in Bonn this year, the 

task is clear: we must raise our ambition, 

work harder, and take concrete steps to 

meet our emissions targets. This is the 

right thing to do for our environment. The 

economic opportunities are enormous. 

And it will ensure a cleaner, healthier, and 

more prosperous planet for our children 

and grandchildren. 

45 

POLICY

POLICY 

WOMEN MUST 

BE AT THE 

HEART OF 


Isabella Lövin, Deputy Prime Minister 

and Minister for International 

Development Cooperation and 

Climate, Sweden 

While women are more 

vulnerable to the effects of 

climate change, they also 

have fewer opportunities to 

make decisions on how to 

deal with it. 

Gender often remains the untold 

story behind climate change. 

While climate change is a global 

phenomenon, its impact is not spread 

across a level playing field. Its eff ects are 

felt locally, and poor people suff er the most. 

Among the world’s 1.3 billion poor people, 

the majority are women. 

During the past few decades, 

considerable achievements have been 

made in narrowing the gender gap in 

many countries. Nevertheless, across 

Credit: Kristian Pohl/Regeringskansliet 

46

the global spectrum, women tend to be 

marginalised from economic and political 

power, and have limited access to financial 

and material resources. This increases 

their vulnerability to climate change and 

limits their potential to adapt. Women 

are also often less represented in the 

corridors of power; have fewer legal rights, 

including access to land; and occupy 

fewer leadership roles in the workplace. 

This means that while women are more 

vulnerable to the eff ects of climate change, 

they also have fewer opportunities to 

make decisions on how to deal with it. We 

must change this. Women have the right, 

and need, to be at the forefront of eff orts to 

deal with both climate adaptation and the 

transition to a zero carbon economy. 

I am proud to represent the first 

explicitly feminist government in the world, 

one that also has the goal of making 

Sweden the world’s first fossil-free welfare 

nation. I strongly believe that the major 

political and environmental challenges 

of today, like climate change, can and 

must be turned into opportunities for 

cooperation and confidence-building that 

can help advance gender equality, prevent 

conflicts and deliver positive outcomes for 

all communities across borders. 

There are numerous examples of 

renewable energy investments that also 

contribute to increased employment 

opportunities for women that foster 

female entrepreneurship. One example 

that illustrates this is the KawiSafi 

project, an investment fund that invests 

in clean energy companies in Rwanda 

and Kenya. The KawiSafi project has 

dedicated funds to train women to 

become solar technicians, while also 

supporting women-led micro-finance 

groups to generate demand for solar 

energy. The majority of the populations 

in Rwanda and Kenya are not connected 

to main power grids. Subsequently, many 

use oil or kerosene for domestic power 

generation. These fossil fuels are often 

expensive as they are imported, while 

noxious fumes pose a serious health 

risk – especially to women and girls, who 

Ghana Bamboo Bikes is a socio-ecological green initiative run by a group of 

enterprising women and young people in Ghana. 

Credit: Jbdodane/Flickr 

generally spend more time performing 

household work. The move to solar 

energy can thus reduce emissions and 

domestic budgets, while also improving 

women’s and girls’ health. This is a clear 

gender co-benefit of climate action. 

Another example of how women can 

play a major role as business leaders and 

help drive the transition toward sustainable 

economic growth and development is 

Ghana Bamboo Bikes. Ghana Bamboo 

Bikes is a socio-ecological green initiative 

run by a group of enterprising women and 

young people who build bicycles out of 

an unlikely material: bamboo. Ten farmers 

grow the bamboo, and 25 builders craft 

it into environmentally friendly bikes that 

can be used on Ghana’s bumpy roads or 

exported overseas. Bernice Dapaah, the 

founder and CEO of Ghana Bamboo Bikes, 

plans to build two new factories soon, 

adding 50 more workers in communities 

with high unemployment. 

A feminist approach to climate action 

is not only an issue of rights, it is also 

smart policy for employment opportunities 

and sustainable economic growth. 

Devising ways to consider gender in 

climate action will not always be easy 

or obvious. Societies are made up of 

complex relationships, sometimes based 

on diff ering structures of kin, power and 

financial resources. But continuing eff orts 

to place gender consideration at the 

centre of climate finance are necessary. 

The world clearly needs more women 

climate leaders, whether around the 

tables where policy is made, or at the 

helm of businesses, steering them toward 

sustainability. 

47 

POLICY

POLICY 

DISASTER RISK 

REDUCTION 

AND CLIMATE 

CHANGE 

Scene from Les Cayes, Haiti, in the aftermath of Hurricane Matthew, 

the category 4 storm which made landfall in the country on 4 October 2016 

48

POLICY 

Robert Glasser, UN Secretary- 

General’s Special Representative for 

Disaster Risk Reduction and Head 

of the UN Office for Disaster Risk 

Reduction (UNISDR) 

This year there has been 

an accumulation of evidence to 

support the claim that 90 per cent 

of disasters now are weather and 

climate related. 

Credit: Logan Abassi, UN Photo/Flickr 

Anyone who followed the recent 

visit of the UN Secretary-General, 

António Guterres, to the Caribbean 

islands of Barbuda and Dominica can 

have no doubts about the existential threat 

that extreme weather events pose for 

small islands battling the eff ects of climate 

change. Mr Guterres is much travelled 

and has seen many disasters, but he 

commented that he had never seen such 

‘a high level of devastation’ as the one that 

he witnessed in Barbuda after the passage 

of Hurricane Irma, which rendered the 

island uninhabitable. Days later, Hurricane 

Maria ripped off roofs and stripped the 

leaves from the trees in Dominica’s rain 

forest which is central to the island’s 

tourism industry and status as a UNESCO 

World Heritage site. 

Following those visits, the Secretary- 

General made a stark pronouncement: 

“The link between climate change and 

the devastation we are witnessing is clear, 

and there is a collective responsibility of 

the international community to stop this 

suicidal development.” This year there 

has been an accumulation of evidence 

to support the claim that 90 per cent of 

disasters now are weather and climate 

related. 

Over the last 18 months, 20 countries 

have declared drought emergencies, 

notably across the Horn of Africa where 

hunger is forcing people off the land in 

49

POLICY 

large numbers. In South Asia, monsoon 

rains and floods have made life miserable 

for 40 million people in Bangladesh, 

India and Nepal. The United States has 

suffered several major calamities this year 

including hurricanes, floods, drought and 

wildfires. The total cost of these events 

has yet to be estimated, but 2017 could 

well be the most expensive year on record 

in terms of economic losses caused by 

weather and climate extremes. 

Global warming is implicated in many 

of these events, triggering variability 

of weather and climate, resulting in 

unprecedented changes in rainfall 

patterns, extreme heatwaves, more 

destructive hurricanes and more powerful 

storm surges associated with rising and 

warming seas. 

As nations meet at the Climate Change 

Conference in Bonn, COP23, it is clear 

that the level of ambition in reducing 

greenhouse gases needs to be raised 

if we are to succeed in keeping the 

global temperature rise well below 2˚C, 

or the more desirable target of 1.5˚C as 

outlined in the Paris Agreement. At the 

same time, we have to recognise that we 

will continue to live with the abnormal 

and often unforeseen consequences of 

existing levels of greenhouse gases in the 

atmosphere for a long time to come. 

This is why it is critically important that 

we invest seriously in measures to help 

us to reduce disaster mortality, reduce the 

Building a retaining wall in 

Afghanistan to limit flooding 

Children take part in a mangrove 

restoration project in Camotes Islands, 

Philippines 

numbers of people losing their homes and 

jobs in disasters, reduce overall economic 

losses, and reduce damage to critical 

infrastructure on the scale we have seen, 

for example, in Puerto Rico following 

hurricane Maria. 

These are key goals among the seven 

targets laid out in the Sendai Framework 

for Disaster Risk Reduction that was 

adopted two years ago by UN member 

states. In 2018 we are poised to launch 

the Sendai Monitor, which will aid 

governments to measure their losses 

and improve their understanding of their 

exposure to disaster risk and therefore 

Credit: UNOPS/Flickr 

Credit: Plan International/Flickr 

where they need to concentrate their 

investments to avoid unnecessary losses. 

The UN Office for Disaster Risk 

Reduction (www.unisdr.org) identifies 

the key drivers of disaster risk as 

poverty, unplanned urbanisation, the 

loss of protective eco-systems and 

weak governance. Climate change and 

population expansion into hazard-prone 

areas all ratchet up a country’s risk 

exposure and vulnerability to disaster 

losses. 

Plans to reduce disaster risk need to 

include measures that reduce climate 

risk. A multi-hazard approach to disaster 

risk management requires integration of 

disaster risk reduction and climate change 

adaptation, thus avoiding duplication of 

effort, maximising scarce resources and 

making life easier for countries reporting 

on progress in achieving the Sustainable 

Development Goals, the aims of the Paris 

Agreement on Climate Change, and the 

Sendai Framework. 

The Sendai Framework has set 

a deadline of 2020 “to substantially 

increase the number of countries with 

national and local disaster risk reduction 

strategies”. Between the launch of the 

Sendai Monitor next year and the drafting 

of these strategies, there is a window of 

opportunity to strengthen risk governance 

and ensure that we are equipped and 

prepared for the century ahead that will 

see global population rise along with 

exposure to extreme weather events. 

The worst disasters that could happen 

have not happened yet and we need to be 

resilient and prepared. 

50

FUELLING GLOBAL 

CROSS-SECTOR COLLABORATION 

The Aid & International Development Forum (AIDF) strives to be a catalyst of cross-sector collaboration and innovation in 

humanitarian and development sectors by bringing together governments, UN agencies, intergovernmental agencies, 

national and international NGOs, development banks, investors and the private sector. 

AID & DEVELOPMENT AFRICA SUMMIT 

February 2018 | Kenya 

africa.aidforum.org 

CLIMATE SMART AGRICULTURE CONGRESS 

March 2018 | Kenya 

csa-africa.aidforum.org 

AID & DEVELOPMENT ASIA SUMMIT 

June 2018 | Thailand 

asia.aidforum.org 

GLOBAL DISASTER RELIEF & DEVELOPMENT SUMMIT 

September 2018 | USA 

disaster-relief.aidforum.org 

If you have a compelling story or research that will inspire and inform other humanitarian and development leaders, 

please email info@aidforum.org or call +44 (0)20 7871 0188. 

@FollowAIDF 

www.aidforum.org

Brought to you by: 

FINANCE 

Official Event Partner 

Financing Innovation for a Low Carbon Future 

On 19th September 2017, Climate Action held the second Sustainable Investment 

Forum in New York. 

The event, in partnership with UNEP Finance Initiative, brought together 300 

attendees from over 30 countries to discuss how to finance a low-carbon future. 

The audience at the Crowne Plaza Times Square heard from over 40 major 

speakers on topics ranging from green bonds, building clean energy markets, and 

the value of sustainable assets. 

High-level participants from leading organisations, including Goldman Sachs, 

Green Climate Fund, the States of New York and California, NextGen America, and 

the International Finance Corporation (IFC) all took part in the event. 

“An excellent forum for discussing financeable 

business opportunities…it does a great job of 

bringing together technologists, investors, and 

policymakers to have an open dialogue about 

practical approaches to carbon and climate.” 

Eric Bielke, Director, Energy Investments, GE Ventures 

“For us at UBS, it is really key to be part of this 

conference – using this platform to communicate 

with our clients and peers” 

Michael Baldinger, Head of Sustainable and Impact Investing, UBS Asset Management 

Climate Action is bringing the Sustainable Investment 

Forum to Europe on 13 March 2018 in Paris. 

This new event will bring together decision-makers from the investment 

community, European governments and think tanks to discuss current challenges 

in the global climate finance market. 

Pre-register: europe.sustainableinvestmentforum.org 

@Climate_Action_ | Join the conversation: #SInvEU 

52

53 

FINANCE

FINANCE 

FINANCING 

CLIMATE IMPACTS 

IN SMALL ISLAND 

STATES 

Thoriq Ibrahim, Minister of 

Environment and Energy of the 

Republic of Maldives 

No country or region is immune 

from climate change, but we are 

not equally vulnerable. For small 

islands, climate change poses particular 

risks, especially from storms and sea level 

rise. For this reason, it is often said that we 

are on the front line of the crisis. We are 

also emblematic of the new policies the 

international community needs to pick up 

the pieces after disaster strikes. 

Hurricanes Irma and Maria, both 

uniquely powerful storms that laid waste 

across Barbuda, Cuba, the Bahamas 

and Puerto Rico, and caused significant 

damage in other parts of the Caribbean, 

graphically illustrated the cost of our 

inaction on climate change. In 2016, 

Cyclone Winston, the strongest tropical 

storm to ever make landfall in the 

Southern Hemisphere, wreaked havoc on 

Fiji. Three record storms and unimaginable 

devastation in two years. The new reality 

of life in the ‘anthropocene’. 

Islands are not the only ones at risk, of 

course. Hurricane Harvey dumped some 

It is no surprise that the elevated 

risks we face often make the cost of 

insurance premiums prohibitive, 

if coverage is available at all. 

32 trillion gallons of water in Texas and 

Louisiana. Irma also severely damaged 

the lower Florida Keys. Nor are storms the 

only climate impact the world is suffering 

from these days. Floods in South Asia have 

claimed thousands of lives in the past few 

months alone. Earlier this year, parts of 

Africa endured deadly droughts. 

To be sure, the cyclones and hurricanes 

have refocused attention on the need 

to operationalise a loss and damage 

mechanism as soon as possible. 

The plan of the Alliance of Small Island 

States (AOSIS), first articulated in the 

1990s, now has an opportunity to be 

turned into action under the Warsaw 

54

FINANCE 

International Mechanism on Loss and 

Damage. The AOSIS plan envisions a 

three-part organisational structure housed 

under the UNFCCC with oversight from 

technical and finance panels. Linkages 

could also be drawn to existing adaptation 

funds as well as a number of UN bodies, 

non-governmental organisations and the 

private sector. 

The first component recognises that 

managing climate impacts demands 

acquiring baseline historical information 

about weather hazards and quantified 

assessments of a variety of new risks. 

The data should be used to guide the 

development and implementation of 

country-specific measures that reduce 

exposure to climate impacts in the first place. 

A second part resembles insurance 

systems commonly found in the developed 

world and would cover countries for costs 

associated with sudden climate impacts, 

such as tropical storms, hurricanes, 

floods, and droughts. This is particularly 

relevant for small islands, because our 

populations tend to be concentrated in 

highly vulnerable coastal zones. And it is 

no surprise that the elevated risks we face 

often make the cost of insurance premiums 

prohibitive, if coverage is available at all. 

Finally, the plan calls for the creation 

of an international solidarity fund, or 

‘mechanism’, that would compensate 

countries for economic and noneconomic 

losses stemming from slowonset 

climate impacts, such as sea-level 

rise, ocean acidification, coral bleaching, 

saltwater intrusion and desertification. 

This could include lost revenue to the 

tourism and fishing industries, cultural 

impacts, and, in the worst case, the cost 

of relocation should islands become 

uninhabitable. 

We have seen what it is like to be on 

the front line of climate change, and what 

it takes to make lives whole again. COP23 

is our next opportunity to take action: we 

had better seize it. 

55

FINANCE 

$70 TRILLION 

GLOBAL 

INVESTMENT 

POOL GOES 

GREENER 

Andrew Steer, President of the 

World Resources Institute (WRI) 

56 

Something very important is 

happening in global finance: 

the US$70 trillion in institutional 

investment pools is turning a little greener. 

A Working Paper from WRI (www.wri.org), 

Navigating the Sustainable Investment 

Landscape, has found that the prospects 

for sustainable investing are strong, and by 

overcoming the remaining obstacles the 

market can indeed reach a tipping point. 

Many portfolio managers used 

to believe – and some still do – that 

allocating funds towards more sustainable 

companies and investments would 

require sacrificing yield. But empirical 

evidence shows that, on average, this is 

not the case. In some instances, taking 

sustainability into account can actually 

enhance corporate financial performance, 

while investment funds oriented to 

sustainability are likely to perform as well 

or better than traditional funds. 

Sustainable Reality, a recent study of 

more than 10,000 mutual funds by the 

Morgan Stanley Institute for Sustainable 

Investing, found that sustainable equity 

funds usually had equal or higher median 

returns and equal or lower volatility than 

traditional funds. An analysis by Oxford 

University and Arabesque Partners, From 

the Stockholder to the Stakeholder, found a 

positive relationship between sustainability 

and financial performance of stock prices 

for 80 per cent of the 41 studies reviewed. 

Asset owners – the pension funds, 

endowments, foundations and people who 

own the capital invested in corporations 

– are in it for the long haul, which 

gives them a diff erent perspective from 

investment managers aimed at short-term 

profit. Long-term investors are eager to 

ensure their capital can weather a range 

of environmental, social and governance 

(ESG) risks, especially climate change.

FINANCE 

In some instances, taking 

sustainability into account can 

actually enhance corporate financial 

performance. 

Hurricane Maria near Puerto Rico. 

Photo by Stuart Rankin/flickr 

Back-to-back billion-dollar natural 

disasters from South Asia to south Texas, 

from hurricanes in the Caribbean to 

wildfires in the Rocky Mountains, show a 

clear pattern of high cost. 

Chief investment officers and individual 

investors are taking note. Mainstream 

financial players including former New 

York Mayor Michael Bloomberg are calling 

for corporations to take more action. A 

global task force set up by the G20 top 

industrialised nations – the Task Force on 

Climate-Related Disasters (TFCD) – has 

developed a voluntary framework for 

companies to disclose the financial impact of 

climate-related risks and opportunities. The 

TFCD has drawn support from more than 

100 companies with US$11 trillion in assets. 

And yet the battle is far from won: 

most fund managers still chase the 

short money. But the trend is in the right 

direction, especially when asset owners 

apply pressure, as they have in 2017. A 

case in point: 62 per cent of ExxonMobil’s 

shareholders voted to instruct the oil 

giant to report on the business impact of 

global measures to limit warming to 2˚C 

above pre-industrial levels. This followed 

similarly successful shareholder votes 

at Occidental and PPL, a large utility 

holding company. 

Investment heavyweights Blackrock, 

Vanguard and State Street – which 

collectively own about 18 per cent of 

ExxonMobil – all reportedly voted for the 

resolution, which was a vote for longterm 

protection for investors’ capital. The 

vote was also in line with Blackrock CEO 

Larry Fink’s 2016 demand that company 

CEOs manage for the long term, even 

though Blackrock and other firms had 

been reluctant to vote against company 

management, especially on issues related 

to climate change. 

These investment houses are not alone, 

and WRI is part of this transition. More than 

300 companies around the world have 

committed to setting targets to reduce 

climate-warming emissions in their value 

chains consistent with the best climate 

science as part of the Science Based 

Targets initiative. The Institute’s Sustainable 

Investing Initiative offers tailored data, 

research and peer-to-peer learning to 

accelerate the shift toward investment that 

integrates ESG factors from the start. 

Ultimately, we should settle for nothing 

less than 100 per cent of investors 

taking ESG into account when making 

investment decisions. We are not there 

yet, but by sharing knowledge about the 

consequences of failing to act now to deal 

with projected climate impacts, there is 

a better chance of persuading portfolio 

managers to think for the long term – just 

as many investors already do. 

57

FINANCE 

SUSTAINABLE 

FINANCE: 

THE GREAT 

ACCELERATION 

One long-standing blind spot has been 

the inability of financial decision-makers to 

see the materiality of environmental, social 

and governance factors, and price capital 

accordingly. 

58

Nick Robins, Co-Director, UN 

Environment Inquiry into the Design 

of a Sustainable Financial System 

A 

decade has passed since the onset 

of the financial crisis. Much has 

been done to fix the problems of 

the past; yet, according to UN Secretary- 

General Antonio Guterres, when set against 

the imperatives underlying the Sustainable 

Development Goals, “today’s global financial 

system, which manages some US$300 

trillion in financial assets on our collective 

behalf, is simply not fit for purpose.” 

One long-standing blind spot has been 

the inability of financial decision-makers 

to see the materiality of environmental, 

social and governance factors, and price 

capital accordingly. Endemic short-termism 

exacerbates the problem, producing what 

the Bank of England Governor Mark Carney 

described in 2015 as ‘the tragedy of horizons’. 

Now things are changing – and with 

unexpected speed. Old puzzles over whether 

integrating ESG into investments can result 

in a profit are now being answered – in 

the affirmative. According to the Financial 

Times, there is “mounting evidence that 

funds which observe ESG standards tend to 

outperform those that don’t by a significant 

margin.” Capital is also being reallocated 

at scale to the low-carbon growth sectors 

of the future. In the first half of 2017, green 

bond issuance expanded by almost 50 per 

cent to reach US$56bn, and is on course for 

US$130bn for the full year, up from US$81bn 

in 2016. So far in 2017, France, the USA and 

China have been the leading green bond 

issuing countries. COP23 President Fiji 

has just issued a sovereign green bond, a 

developing world first. 

More significant still is how environmental 

factors are becoming part of the wider 

architecture that governs the financial 

system. The Financial Stability Board – 

which was set up in the wake of the financial 

crisis – has now begun to confront the 

threat of climate change. Its Task Force on 

Climate-Related Financial Disclosures has 

presented an industry-led set of reporting 

recommendations that will drive the climate 

transition into both corporate planning 

and investment decisions. Importantly, this 

voluntary package is already being endorsed 

by leading insurance regulators, such as 

California, Brazil, France, the Netherlands, 

Singapore, South Africa and the UK, who 

realise that they also need better climate 

data to ensure that the companies they 

supervise are ‘safe and sound’. 

Perhaps the most striking example 

of this fusion of environmental threats 

with financial regulation comes from 

the European Union. In September 2017, 

the European Commission decided that 

the European supervisory authorities for 

banking, securities markets and insurance 

should aim to ‘promote sustainable 

finance while ensuring financial stability’ 

– something that would have been 

unthinkable just a year before. 

A number of factors explain this shift – not 

least the recognition that climate change 

wrecks our ability to deliver long-term 

returns for savers and investors. But this 

is not all about avoiding risk. Some of the 

world’s leading financial centres – including 

Casablanca, Hong Kong, London, Paris and 

Shanghai – are now starting to take action 

to seize the strategic opportunity presented 

by sustainable finance. Increasingly clean 

energy and electric vehicles are no longer 

‘mitigation’ measures to cut carbon pollution, 

but ways of rebooting the economy. To 

realise the potential, we need a financial 

system that makes the transition cheaper, 

faster and smoother. 

A key challenge is to translate climate 

goals – as expressed in the Nationally 

Determined Contributions (NDCs) – into 

clear rules, standards and incentives for 

banking, capital markets and insurance. A 

growing number of countries are putting in 

place sustainable finance roadmaps to do 

this, from China to Italy and on to Morocco. 

The European Union has also set up a highlevel 

expert group on sustainable finance 

to produce its own roadmap. Across the 

world, a pressing issue is how to deploy 

digital finance to deliver environmental and 

social benefits, for example, through mobile 

banking, peer to peer investments and big 

data analytics. Importantly, these roadmaps 

do not happen in isolation – and the value 

of international initiatives – such as G20’s 

green finance study group – is to share 

experience and drive emulation of good 

practice. According to the Green Finance 

Progress Report (2017), prepared for the G20 

by the UNEP Inquiry (http://unepinquiry.org), 

the past year has seen the introduction of 

the greatest number of financial policies and 

measures to promote green and sustainable 

finance. 

Making the bridge between sustainable 

finance and core economic goals is one sign 

of a new maturity. Designing sustainable 

finance so that it helps cut poverty and 

inequality is another, particularly in the 

developing world. We know from the past 

that mismanaged transitions can result in 

social dislocation. As we make the shift to a 

resilient zero carbon economy, the financial 

system needs to focus not just on avoiding 

‘stranded assets’ but also ‘stranded workers’ 

and ‘stranded communities’. One way of 

doing this could be to develop ‘sustainable 

finance zones’ to connect the expertise and 

resources of the world’s financial centres 

with key areas of socio-economic need. 

In the current situation where demand for 

green assets is outstripping supply, these 

‘sustainable finance zones’ could help to 

build pipelines of bankable projects that 

hit climate goals and social objectives 

simultaneously. 

In the process, we will have gone some 

way to respond to Guterres’ challenge, 

and will have helped to create a financial 

system that is truly fit for sustainable 

development. 

In the first half of 2017, green bond 

issuance expanded by almost 50 per 

cent to reach US$56bn. 

59 

FINANCE

FINANCE 

THE IMPORTANCE 

OF CLIMATE- 

RELATED 

FINANCIAL 

DISCLOSURES 

Graeme Pitkethly, Unilever’s Chief 

Financial Officer and a Vice Chair of 

the Task Force on Climate-related 

Financial Disclosures (TCFD) 

Even today, as you read this, climate 

change is impacting businesses 

around the world. It disrupts supply, 

reduces crop yields, increases costs and 

prompts regulation. Recently, Climate 

Wise calculated that the ‘protection gap’ 

– that is, the uninsurable risk from climate 

change – has grown to US$100bn. And 

for businesses, today’s challenges pale in 

comparison to what could come tomorrow. 

Despite this, very few companies 

currently report climate change as a risk. 

According to KPMG, 72 per cent of large 

and mid-cap firms worldwide do not 

acknowledge the financial risks of climate 

change in their annual financial reports. 

I believe this will change. Why? Because 

the current situation can undermine 

both the stability of the global financial 

system and the ability of companies and 

investors to fully understand the risks and 

opportunities they face. 

60 

If markets are to operate efficiently 

they must be transparent, to help 

investors evaluate companies and 

make better decisions for the long 

term. Without transparency, investors 

in financial markets will lack clear 

information about which companies 

or assets are most exposed to climate 

change, and which are best prepared. 

Access to comparable reporting data 

promotes better pricing of climaterelated 

risks and opportunities. It also 

leads to more informed investment, 

credit and insurance underwriting 

decisions. 

Crucially, reporting climate change in 

financial filings encourages management 

teams and boards to properly assess the 

scenarios their companies face. After all, 

annual reports should always outline key 

risks to a business – and climate change 

is surely one of them. Those who invest 

time in this exercise will be rewarded 

by being better able to make decisions 

for the future of their businesses, and 

navigate the transition to a low-carbon 

economy. The opportunities alone are 

substantial. US$25 trillion of assets 

under management are participating in 

Investor Platforms on Climate Change. 

Add to that another US$23 trillion of 

investment opportunities in emerging 

markets as a result of COP21, according 

to the IFC. 

It is clearly in a company’s interests 

to disclose climate-related data. It 

is only a matter of time before most 

investors – as well as consumers, 

employees and governments – actively 

ask for this information. In many cases, 

this is already happening. We know, 

for example, that transparency is 

increasingly important to consumers, 

particularly millennials. They want to 

understand and trust the companies 

behind the brands they buy, and they 

want to know more about their purpose 

and values.

So the business case is evident. And 

thanks to the work of the Task Force on 

Climate-related Financial Disclosures 

(TCFD), convened by Bank of England 

Governor Mark Carney and chaired 

by Michael Bloomberg, we now have 

a clear framework to help companies 

consider and disclose climate changerelated 

financial factors. As part of 

the TCFD, we focused on developing 

recommendations for voluntary, 

consistent, financial reporting on climate 

change. Importantly, we designed them 

to be as practical as possible to adopt 

in mainstream financial filings, across 

sectors and geographies. Unilever was 

one of the first companies to commit to 

Access to comparable reporting 

data promotes better pricing of climaterelated 

risks and opportunities. 

implementing the recommendations. We 

are working towards their adoption and 

urge others to do the same. 

Of course, there are many other 

things that businesses can do to tackle 

climate change. For example, Unilever 

has reduced CO 2 

from energy in 

manufacturing by almost two-thirds over 

the past two decades and we have set a 

bold target of being carbon positive by 

2030, committed to sourcing 100 per cent 

of our energy from renewable sources. 

Not only is this the right thing to do, but 

it benefits our shareholders, with lower 

operational costs and greater resilience 

in our energy supply. By proactively 

cutting our greenhouse gas footprint, we 

also reduce our exposure to increasing 

environmental regulation and taxes. 

To tackle climate change we need 

continued leadership from governments, 

cities, regions and, of course, businesses 

to create a virtuous cycle of action and 

ambition. Most of all, climate change is 

no longer an environmental issue. It is 

a profound issue of economic transition 

and financial stability, as likely to be 

on a G7 or G20 agenda as any other 

geopolitical or macroeconomic concern. 

As world leaders come together in 

Canada and Argentina in 2018 to 

address concerns around the global 

economy, I hope that their endorsement 

of the Task Force’s recommendations sits 

high on their agenda. 

FINANCE 

61

FINANCE 

CLIMATE 

TRANSPARENCY 

IN FINANCIAL 

MARKETS 

Remco Fischer, 

UNEP Finance Initiative (UNEP FI) 

62 

One of the great challenges of the 

next few decades will be to make 

economic growth and social 

development – and thus human welfare – 

compatible with the stability and health of 

the world we live in – or even conducive to 

it. Achieving that requires nothing short of 

greening capitalism: putting the marketdriven 

energy, innovation and motivation, 

which over the last centuries have forged 

modern economies and raised hundreds 

of millions out of poverty, at the service 

of protecting the global commons. In that 

ambitious context, the Financial Stability 

Board’s (FSB) Task Force on Climate- 

Related Financial Disclosures (TCFD) 

and the recent publication of its Final 

Recommendations Report now mark a 

real and significant milestone of progress 

(www.fsb.org). 

The disclosure framework that the TCFD 

provides, and the political impetus with 

which it is provided, have the potential 

to give an unprecedented boost to the 

systematic integration of climate factors 

into economic and financial decisionmaking. 

They will boost the seriousness 

with which investors and other 

stakeholders consider the future viability 

of business in their decision-making. They 

will, of course, need to take into account 

that tomorrow’s technology policy will be 

radically diff erent from today’s as a result 

of climate change. 

Specifically, there are three core features 

in the TCFD Framework that make it stand 

out, and mark a new stage in the journey to 

full disclosure of climate and environmental, 

social and governance issues. 

Firstly, it is true – as stated by 

Mark Carney, Governor of the Bank 

of England and FSB Chair – that the 

recommendations were developed by 

the market, and for the market. It is also 

true that the TCFD’s work has been 

undertaken explicitly under the auspices 

of the financial regulatory community. This 

is the first time that international financial

that they need it. As a result, the overall 

disclosure practice by companies and the 

ensuing availability of corporate data will 

be improved. 

Thirdly, meaningful assessments of the 

financial risks and opportunities of climate 

change can only be achieved in a forwardlooking 

way, given how climate change 

and its impacts are not static – quite the 

contrary. Currently, for instance, we are 

experiencing a world that is roughly 1˚C 

warmer than in pre-industrial times. This 

is characterised by still growing global 

emissions, and a still fairly tepid global 

landscape of public decarbonisation 

targets and policies. By extension, the 

financial risks and opportunities from 

critical, and so promising in advancing 

the robustness, ‘scrutinisability’ and 

credibility of climate-related corporate 

and investor disclosures. 

In the same way as the TCFD framework 

and the above features are necessary and 

promising, so will be their implementation 

by practitioners in the real world be 

ridden with complexity. This particularly 

applies to financial institutions. The 

development of scenarios able to capture 

relevant parameters, across technological, 

policy and physical domains, and the 

modelling of likely business outcomes 

under various scenarios, will be complex 

for companies in the real economy. 

For financial institutions, however, the 

FINANCE 

This is the first time that 

international financial regulators 

are taking a stance, mandating and 

endorsing work on the financial 

repercussions of an environmental 

issue. 

regulators are taking a stance, mandating 

and endorsing work on the financial 

repercussions of an environmental issue. 

There is no need to explain what this 

new political impetus means for the 

seriousness and determination with which 

financial market actors are now likely 

to approach the challenge of managing 

climate-related risks. 

Secondly, banks, insurers and investors 

are themselves now considered to be 

not only recipients of disclosures from 

others, but also preparers of disclosures 

themselves, to their own stakeholders. 

Clearly, if investors are now expected 

to provide transparency on the climaterelated 

risks and opportunities that they 

face, and be scrutinised accordingly, 

they will take the climate disclosure 

challenge far more seriously than before. 

This implies that in the future they will be 

more determined in obtaining climaterelated 

data from companies in their 

portfolios – in the formats and the quality 

climate change do currently exist but are 

limited. And so, if asked for corresponding 

assessments, most actors would 

accurately convey just that. The point, 

however, is that current circumstances 

are unstable and highly likely to change 

radically in the coming years and decades. 

If world leaders fail to increase their 

decarbonisation ambition and eff orts, 

the additional warming by 2, 3 or more 

degrees would intensify the physical risks 

to unprecedented, economically disruptive 

levels, while keeping transition risks at 

bay; if, on the other side of the spectrum, 

leaders did take determined action to 

mitigate climate change, the transition 

risks would be significant while the more 

dangerous physical risks would remain 

manageable. So, no matter what, the 

climate-impacted future will be diff erent 

than the present. 

That is why the strong emphasis in 

the TCFD framework on forward-looking, 

scenario-based assessments is so 

exercise becomes daunting, since their 

climate exposures are manifested in large 

portfolios comprising at times innumerable 

positions across virtually all sectors of the 

economy. 

It is the combination of a challenging 

task ahead and a new determination 

among leading financial actors to 

tackle it that has allowed us as UNEP 

FI to convene 17 leading banks from 10 

countries in diff erent parts of the world 

to collaboratively work towards a first set 

of TCFD-compliant disclosures. Through 

this working group of industry pioneers 

we hope to cut through the complexities 

at hand and to ultimately off er climate 

disclosure guidance to the banking 

industry at large. If a critical mass of banks 

then follows and becomes systematic in its 

appraisal, disclosure of, and response to, 

climate-related risks and opportunities, we 

might have moved the dial a little bit in the 

ability of financial markets to become a 

leading force in greening capitalism. 

63

FINANCE 

CARBON PRICING 

IN THE PARIS 

AGREEMENT ERA 

Richard Zechter, Adviser - Climate 

Finance, Climate Change Group at 

the World Bank 

As we respond to the huge policy 

challenge of climate change, it is 

clear that carbon pricing plays a 

crucial role. In particular, it requires the 

cost of greenhouse gas emissions to be 

considered in financial decisions. This 

levels the playing field between emissionintensive 

and low-carbon economic 

activities, triggering more investments in 

low-carbon technologies. 

In the 2017 State and Trends of Carbon 

Pricing edition (forthcoming from World 

Bank Open Knowledge Repository), we find 

that carbon pricing initiatives are continuing 

to spread. Significant progress has been 

made over the past two years, including the 

64 

entry into force of the Paris Agreement and 

the eight new carbon pricing initiatives that 

have been implemented in national and 

subnational jurisdictions. When the Chinese 

national emissions trading system (ETS) is 

launched – planned for the end of 2017 – it 

will be the largest carbon pricing initiative 

in the world. Developments in the Americas 

have been particularly prominent, with six 

new carbon pricing initiatives implemented 

in this region since the beginning of 2016. 

But more progress is needed to reach the 

goal of the Paris Agreement: the coverage 

of GHG emissions must expand, deeper 

impacts on emission reductions need 

to be triggered by raising carbon prices, 

and the speed of these actions should 

accelerate. The current level of carbon 

prices is significantly lower than the level 

that the High-Level Commission on Carbon 

Prices found to be consistent with the 

temperature goal of the Paris Agreement. 

While 15 per cent of global GHG emissions 

are currently covered by an ETS or carbon 

tax, a much higher coverage combined 

with international cooperation on climate 

markets is essential to mobilise the large 

volume of resources for a decarbonised 

economy and to bring down the costs of 

low-carbon technology. 

The potential role for international market 

mechanisms in reducing the cost of climate 

change mitigation is crucial. Modelling 

analysis undertaken in the 2016 State and 

Trends of Carbon Pricing report has shown 

that an international carbon market could 

reduce the cost of delivering the emission 

reductions identified in the current Nationally 

Determined Contributions (NDCs) by 

about a third by 2030. Negotiations are 

now under way to develop the guidelines 

Credit: Jutta Benzenberg, World Bank

to implement the Paris Agreement, with 

country-level pledges to reduce GHG 

emissions formalised through NDCs. Carbon 

pricing plays a prominent role in many 

of these NDCs, with 81 parties currently 

planning or considering its use. Among 

other functions, the Paris guidelines will 

govern the operationalisation of cooperative 

approaches to emissions mitigation under 

Article 6, thereby shaping the way forward 

for international market mechanisms and the 

linking of domestic carbon pricing initiatives 

under the new international climate accord. 

In our report we also explore how the two 

main modalities of international cooperation 

– climate finance and climate markets – can 

be used in an integrated approach to enable, 

support and complement domestic policies 

to stimulate the flow of resources. We focus 

on the role that results-based climate finance 

The potential role for 

international market mechanisms in 

reducing the cost of climate change 

mitigation is crucial. 

can play in piloting cooperative approaches 

under Article 6 to help provide lessons for 

the implementation of international market 

mechanisms. 

Without urgent action, climate 

impacts could push an additional 100 

million people into poverty by 2030. The 

fundamental challenge is how to build a 

sustainable global economy, where climate 

change and other environmental threats 

are met, while pursuing shared prosperity. 

To succeed in tackling climate change we 

must succeed at mobilising the required 

investments, involving trillions of dollars 

annually. An integrated policy response 

will be needed that combines the full 

range of climate change mitigation polices, 

including domestic carbon prices, other 

domestic policies, climate finance and 

international market approaches. 

FINANCE 

We need to shift planned investments to 

low carbon alternatives 

and mobilise incremental 

low-carbon investments 

of $700 billion* 

annually by 

2030 to transition to a 

low-carbon economy. 

The $700 billion estimate is based on studies by 

the IEA & IRENA, McCallum et al, and the World 

Economic Forum, et al. 

65

INNOVATION 

8th Annual 

Environment Ministers, 

CEOs, and Mayors are 

attending the 8th 

Sustainable Innovation Forum 

Climate Action, in partnership with UN Environment, is hosting the largest 

business-focused event taking place during COP23. 

The 8th Sustainable Innovation Forum is bringing together over 600 delegates 

and 75+ world-class speakers for two days of sharing ideas, networking, 

collaboration and deal making that will fast track the green economy. 

The Forum provides a world class line-up of keynote speakers, panel 

discussions, networking sessions, on-stage interviews, innovation spotlights, 

Mayors’ breakfast briefings, and much more. 

Hear from global sustainability leaders on the latest developments in clean 

energy, decarbonising transport, sustainable cities, the circular economy, 

climate finance and more. 

Speaker highlights include: 

• Jerry Brown, Governor of California and Special Envoy for States and 

Regions 

• Erik Solheim, Executive Director, UN Environment 

• Environment and Energy Ministers from around the world, including: 

Denmark, Poland, Ecuador, Norway, UAE, the Maldives, Luxembourg, 

Estonia, Ethiopia, and more. 

There will also be an exclusive Mayor’s ‘BreatheLife Cities Roundtable’, in 

collaboration with ICLEI and UN Environment. This breakfast event aims 

to mobilise cities and individuals to protect our health and planet from the 

effects of air pollution. 

Delegates are representing national and regional governments, the private 

sector, the UN, NGOs, academia, responsible investors, development banks, 

sustainability entrepreneurs and more. 

The Forum is taking place at the heart of COP23 and the negotiations – 

conveniently located steps away from the ‘Bula Zone’, at the 

Climate Action Domes. 

66

67 

INNOVATION

INNOVATION 

MISSION 

INNOVATION: 

ACCELERATING 

THE TRANSITION TO 

A CLEAN ENERGY 

ECONOMY 

Patrick Child, Deputy Director- 

General – DG Research & Innovation, 

European Commission, and Mission 

Innovation Steering Committee Chair 

Remarkable strides have been 

made over recent years in driving 

down the costs of clean energy 

technologies. From onshore wind power 

to solar energy, from electric car batteries 

to LED lighting, costs have plunged 

dramatically across the board. These 

successes are testament to the power of 

innovation. By coupling sustained public 

investment in research and development 

with business leadership, fledgling ideas 

are brought into the mainstream. Despite 

these successes, many promising clean 

energy solutions are not yet market-ready 

and capable of competing with fossilfuel-based 

energy. In brief, the pace of 

innovation falls significantly short from what 

is required, considering the scale of energy 

system transformation needed. 

Mission Innovation aims to reinvigorate 

global efforts in this regard. Launched at 

COP21 in Paris in November 2015, it is a 

global initiative of 22 countries and the 

European Commission (acting on behalf 

of its member states). Member countries 

collectively account for more than 80 per 

cent of the world’s total public financing of 

clean energy research and development. 

By joining Mission Innovation, member 

countries recognise a critical reality: 

68

we need to accelerate the development 

of clean energy solutions to match the 

urgency of tackling climate change. Quite 

simply, for fossil fuels to remain in the 

ground, we need to accelerate to the point 

where clean energy is cheaper than coal, 

gas or oil. 

Each Mission Innovation member 

determines the means for advancing 

the common goals and pursues them 

independently. But since the inaugural 

ministerial meeting in June 2016 (MI-1), 

countries have clearly established dynamic 

cooperation in a spirit of joint ambition. 

Beyond the quantitative goal to double 

clean energy R&I investments, we have 

launched a number of initiatives to boost 

the impact of these investments. This 

includes the setting-up of collaborative 

networks and partnerships around clean 

energy innovation. 

One of the most exciting projects 

launched over the last year is the so-called 

Innovation Challenges. These are global 

calls to action aimed at accelerating 

research, development and demonstration 

Mission Innovation members share 

common goals and seek to double 

public clean energy research and 

development investment over 

five years, to develop and scaleup 

breakthrough clean energy 

technologies and to achieve substantial 

cost reductions in the process. 

(RD&D) in technology areas where 

Mission Innovation members believe 

increased international attention would 

make a significant impact in our shared 

fight against climate change. The seven 

Innovation Challenges are ambitious. They 

will stretch the boundaries of clean energy 

scientific know-how and include goals 

such as creating intelligent electricity grids 

and generating storable solar fuel from 

sunlight. They cover the entire spectrum 

of RD&D, from early stage research needs 

INNOVATION 

69

INNOVATION 

Bill Gates of the Breakthrough Energy Coalition and Carlos Moedas, 

European Commissioner for Research Science & Innovation 

Credit: IISD/Francis Dejon (enb.iisd.org/energy/mi/2016/1jun.html) 

assessments to technology demonstration 

projects. They aim to encourage increased 

engagement from the global research 

community and provide opportunities for 

new collaborations between participating 

countries and investment prospects for the 

private sector. 

Although much progress has been 

made, the global clean energy economy 

is still in the early stages of a multibillion 

dollar shift. Mission Innovation 

and the clean energy transition provide 

a compelling opportunity for investors, 

as can be seen by initiatives such as Bill 

Gates’ Breakthrough Energy Coalition. 

We know from past experience (in areas 

such as space, technology and medical 

research) that public investment in 

research leads to creation of businesses 

driven by private capital. Through 

Mission Innovation, we have political 

momentum. With the skills, resources, 

experience and vision of leading 

investors and industry, together we can 

take clean energy innovation from the 

laboratory to the market place. 

At its second Ministerial meeting 

(MI-2) in Beijing in June 2017, Mission 

Innovation joined forces with the World 

Economic Forum. This new collaboration 

facilitates engagement between Mission 

Innovation activities and World Economic 

The seven Innovation Challenges 

will stretch the boundaries of clean 

energy scientific know-how. 

Forum members and partners. At the 

outset, attention is focused on selected 

Innovation Challenges – areas that are 

most promising for greater public–private 

cooperation to help develop and unleash 

new technologies into the market. 

The European Commission (EC) 

currently chairs the Mission Innovation 

Steering Committee, a position it will 

hold up to the 3rd Ministerial meeting 

(MI-3), which is to be co-hosted by 

the EC, Denmark, Finland, Norway and 

Sweden in 2018. Taking place in Malmö 

and Copenhagen on 23-24 May, the 

meeting aims to build on the political 

momentum generated at MI-2 in China. 

Private sector engagement in clean 

energy innovation will be a key theme 

of MI-3. By bringing Ministers from all 

Mission Innovation countries to the table 

alongside leading clean energy investors 

and captains of industry, we will be able 

to leverage the high-level political will 

and private sector leadership needed to 

drive ambitious, real-world clean energy 

policies and actions. 

70

CATALYSING CLIMATE 

INNOVATION IN 

DEVELOPING 

COUNTRIES 

INNOVATION 

Anabel Gonzalez, Senior Director, 

Trade and Competitiveness Global 

Practice, World Bank Group 

The world is undergoing a clean 

technology revolution, and small 

and medium enterprises (SMEs) in 

developing countries will play a crucial 

role, transforming technology advances 

in climate sectors into commercial 

applications for local markets. The 

World Bank Group (www.worldbank. 

org) and others are supporting SMEs 

in this important work with financing, 

proper regulatory environments, technical 

assistance, and international cooperation. 

As climate SMEs scale and deploy new 

innovations, developing countries will not 

only increase their climate resilience and 

economic eff iciency, but also enhance 

national competitiveness with job 

creation and investment in many of the 

most dynamic sectors of the 21st century. 

Investment needs in green sectors for 

developing countries will be immense, 

with huge opportunities for local firms. 

The International Finance Corporation, 

a member of the World Bank Group, has 

estimated that US$23 trillion in climatesmart 

investment opportunities exist in 

selected emerging markets, and a World 

Bank report, Building Competitive Green 

Industries, showed that up to 25 per cent 

of climate investments in developing 

countries are available for local 

SMEs. Advances in renewable energy, 

efficiency, climate-smart agriculture 

and clean water create opportunities 

for companies to address development 

challenges with cleaner, more climatefriendly 

technologies and practices. 

Local SMEs play an essential role 

in scaling climate innovations for 

developing countries, and more needs 

to be done to support them. SMEs are 

a crucial ingredient for commercial 

innovation, but they face barriers in 

developing countries that are particularly 

acute in climate sectors. For example, 

many climate technologies have 

Jonathan Coony, 

Global Lead, Green Competitiveness, 

World Bank Group 

Table 1. What makes green sectors different? 

Need of last mile delivery 

Green enterprises deliver physical 

products to market 

Capital intensive 

Green enterprises have high upfront 

capital needs 

High dependency on policy support 

Green enterprises are highly dependent 

on regulatory regimes and the public 

sector more generally 

Green enterprises take longer to 

reach profitability 

Green enterprises, on average, have 

longer “gestation” periods before they 

reach profitability and the steep part of 

the enterprise growth curve 

Source: Innovations for Scaling Green Sectors report, infoDev, 2017 

71

Credit: Safi Organics 

INNOVATION 

Workers at Safi Organics in Kenya use biochar made from 

agricultural waste to make a soil conditioner 

capital-intensive hardware that requires 

extensive physical testing before launch. 

In addition, to account for their positive 

externalities, climate technologies can 

be heavily dependent on policy support 

whose variability can impede steady 

company growth. Table 1 summarises 

these barriers. 

When SMEs do not play an active role 

in commercialising new climate-related 

products and services for their countries, 

successful climate innovation lags. No 

one understands local market conditions 

better than local companies, and without 

the application of this knowledge poor 

technology choices will be made and 

scaling will be hindered. SMEs are 

essential to identify and adapt relevant 

technology advances with innovation in 

locally relevant business models that put 

those advances to use. 

Fortunately, a number of models 

are emerging to address the barriers 

SMEs face, so that local firms grow in 

rapidly expanding climate sectors. The 

World Bank recently released a report, 

Innovations for Scaling Green Sectors, 

that analysed the success and failure 

of SMEs to scale climate innovations in 

developing country markets. It proposed 

a framework of how these companies 

Local SMEs play an essential 

role in scaling climate innovations for 

developing countries, and more needs 

to be done to support them. 

can be supported, as shown in Table 2. 

The World Bank Group is putting 

these principles into action with its 

infoDev Climate Technology Program 

(CTP), supported by the governments 

of the United Kingdom, Denmark, the 

Netherlands, Australia and Norway. The 

CTP has launched a network of Climate 

Innovation Centers in seven developing 

countries that directly support climate 

SMEs to commercialise and scale their 

innovations. A second generation of 

Climate Innovation Centers is under 

development. 

At COP22 in Marrakech, the World Bank 

expanded its work in this area with the 

launch of the Climate Business Innovation 

Network (CBIN), in partnership with the 

Moroccan government. The CBIN crowds 

in a range of local and global stakeholders 

from the public and private sector to bring 

comprehensive support to the entire 

innovation ecosystem for climate sectors 

in developing countries, with particular 

focus on local SMEs. 

Many companies supported by the 

CTP are already making a difference in 

the climate sectors of their countries. In 

Ghana, Gloria Asarea Adu and Marigold 

Adu lead Global Bamboo, a company 

selling briquettes from bamboo that 

preserve forests, reduce emissions and 

decrease health risks by reducing smoke. 

In Morocco, another CTP-supported 

company, eLum, is using innovative 

artificial intelligence software to optimise 

energy management between solar 

panels, battery systems and the grid 

to reduce both electricity bills and 

emissions. And in Kenya, Safi Organics 

72

Table 2. Opportunities and innovations for scaling green sectors 

Opportunity 

Business model 

innovations 

Examples 

• Mobile-enabled PAYGO financing mechanism has fostered the development of green subsectors such as 

SHS. 

• Bundled service combines related product offerings and builds forward and backward integration for 

products and services to offer packages of solutions. 

• Credit history facilitation for low-income customers through initial sales and monthly payment history 

allows customers to upgrade and access credit for other purposes and from other finance providers. 

INNOVATION 

Enabling 

technology 

platforms 

Market creation 

and de-risking 

mechanisms 

Speciality 

financing 

instruments for 

green businesses 

Technology and 

business model 

transfer 

Strategic 

partnerships 

• Technology that allows for rapid credit appraisal of potential low-income consumers is being piloted. 

• Technology platforms / MNOs that enable payments and collections (such as Safaricom’s M-PESA for 

payments). 

• Technology platforms / MNOs that enable payments and collections (such as Safaricom’s M-PESA for 

payments). 

• Convergence and combination of multiple technology-backed services has enabled an overall drop in 

costs such as smart meters, mobile money and low-cost solar for SHS. 

• Quality certification programmes that establish quality standards and best practices provide clarity in the 

marketplace for consumers and ensure that poor quality products do not spoil the market for green products. 

• Trade and industry associations can provide services such as policy development and analysis, training, 

codes of practice, industry promotion, networking, conferences and industry updates. 

• Development of robust data metrics that allow investors interested in green enterprises to measure the 

economic, social, and environmental performance of their investment are important tools to drive sector 

development. 

• Speciality financing mechanisms that invest in early stage green enterprises such as World Bank 

Group’s climate venture facilities (CVFs), growth stage low-cost debt and working capital facilities, and 

instruments that provide mitigation of local currency and interest rate risk for green enterprises, can drive 

green subsectors. 

• Specific efforts to transfer technology or business models from one country to another can potentially 

enable scale. 

• Matchmaking of foreign businesses or technology with local businesses is being piloted to help 

successful green businesses and business models to scale out. 

• Choosing the business partner and area of collaboration has enabled many green enterprises to 

operationally scale their businesses both in their home countries and expand outside to cover a larger 

customer base. 

• Partnerships for building customer awareness and for customer financing help green businesses in 

market building and reaching potential customers. 

Source: Innovations for Scaling Green Sectors report, infoDev, 2017 

promotes climate-smart agriculture by 

converting agricultural waste into carbonnegative 

soil conditioner. The company 

founder, Samuel Rigu, has already 

expanded production capacity from five 

to 25 tons per month and has a vision 

for Safi Organics to grow to the point of 

reaching 38 million farmers across Africa. 

In these and many other cases, 

companies are helping their countries 

respond to climate challenges with a 

pro-growth approach. Without these 

SMEs, the new clean technology 

advances being seen around the 

world would not be adapted to local 

circumstances for deployment and 

scale-up. 

However, more still needs to be done 

to build on these successes. We need 

to strengthen the crucial link that local 

SMEs represent in scaling the innovations 

essential for developing countries to 

address climate change. The historic shift 

to greener and cleaner economies is 

proceeding apace at the global level, but 

we must ensure that developing countries 

take part in this process. 

The World Bank Group is eager to 

partner with others to expand the work 

that makes local SMEs a key player in 

this transformation. In doing so, we can 

bring the clean technology revolution 

to developing countries so they can not 

only address climate threats but also 

drive growth through job creation and 

investment in highly dynamic markets. 

73

INNOVATION 

INNOVATIVE 

TECHNOLOGIES 

PROVIDE THE 

ANSWER TO 

CLIMATE CHANGE 

Dr Roland Busch, Chief Technology 

Officer and Member of the Managing 

Board of Siemens AG 

Follow me on Twitter @BuschRo 

74 

On sunny days some residents in 

Brooklyn generate more electricity 

from the solar panels on their roofs 

than they can consume. Fortunately as 

members of the Brooklyn Micogrid project, 

they can trade this electricity with their 

neighbours on a blockchain platform. While 

helping to reduce their community’s carbon 

emissions, these residents also benefit 

through lower energy bills. And with plans 

to install battery storage, should a big storm 

hit, this Brooklyn community won’t be left 

in the dark. 

Every time a severe storm strikes, 

the issue of climate changes raises its 

head. There is a growing acceptance 

that the effects of climate change 

are happening now and not in some 

distant future. This year alone several 

extreme weather events have damaged 

infrastructure, caused economic losses 

and put lives at risk. Business as usual is 

no longer an option. Like the residents of 

Brooklyn, governments, companies and 

communities need to act. 

Digitalisation can make the energy 

transition happen 

If we want to limit global warming to 2°C 

as outlined in the Paris Agreement, then 

renewable sources will have to play a 

bigger role in meeting energy needs. The 

progress made is encouraging. Who would 

have thought 10 years ago that renewables 

would be as competitive as fossil fuels, not 

to mention the positive effect on job creation. 

Given the scale and their intermittent nature, 

digital technologies will be a key enabler to 

increasing the share of renewable energy 

generation. Innovative technologies are 

already available today for grid integration, 

stability, demand management and storage. 

Governments will need to bring forward 

policies for electricity markets and carbon 

pricing to foster long-term investment. 

Switching to electric power also offers 

enormous potential to decarbonise our 

economy, from heating for buildings, 

to power for industrial processes and 

transportation. Public transport in many 

cities, such as metros and trams, already 

operate as electrified systems. While 

road transport is still heavily reliant on 

combustion engines, several automotive 

companies recently committed to 

producing more hybrid and electric 

vehicles. Meanwhile Siemens has been 

working on an innovative solution to 

electrify freight transport, known as 

eHighway, with demonstration projects 

in Germany, Sweden and California. 

Energy efficiency measures, like building

Brooklyn Microgrid participants can sell excess solar power to their neighbours on the TransActive 

Grid blockchain platform from LO3 Energy. Siemens provides microgrid control solutions. 

INNOVATION 

Copyright LO3 Energy 

automation systems or energy monitoring 

are compelling ways to reduce energy 

consumption and thereby emissions, 

through their cost saving benefits. 

Cutting carbon through 

connected cities 

Responsible for 80 per cent of CO2 

emissions, cities have a fundamental role to 

play. The first step in tackling emissions is to 

have a clear strategy. The City Performance 

Tool (CyPT), developed by Siemens, 

assesses the impact of technologies in 

the building, energy, and transport sectors 

on GHG emissions and air pollutants, and 

the CAPEX and OPEX required. Many 

cities have used the CyPT tool to design 

strategies to reduce emissions and found 

that investing in green technologies also 

creates job opportunities. 

Integrating distributed renewable 

energy sources, like the Brooklyn 

Microgrid, is an effective way to cut 

emissions, boost resilience and meet 

energy demands. The IEA estimates that 

by 2050, rooftop solar panels could supply 

almost one third of a city’s energy needs. 

Copyright: Siemens Press 

In 2015, Siemens pledged to 

become the world’s first major carbonneutral 

industrial enterprise by 2030. 

As previously mentioned, electrified 

transport can significantly cut emissions. 

But the bigger opportunity comes from 

using IoT technologies to integrate sectors. 

Connected buildings and electric vehicles 

can interact with power grids to consume, 

store or supply electricity as required. 

Integrated transport systems combined 

with innovative mobility services can 

encourage uptake of public transport. 

Open IoT operating systems, like 

MindSphere can help cities to take 

advantage of these opportunities by 

securely connecting their infrastructure to 

the cloud and leverage their data. 

Data insights coupled with the ability of 

systems to speak to each other can help 

The eHighway is an innovative solution 

for electrified road freight transport. 

cities tackle issues like congestion and 

air pollution and to better manage energy, 

water and other services in innovative 

ways. Singapore, for example will be 

piloting MindSphere to become a fully 

integrated urban ecosystem. 

The business case for climate action 

More and more companies are taking 

action to green their footprint and enjoying 

the benefits, such as lower costs through 

energy efficiency measures, as well as new 

business opportunities. In 2015, Siemens 

pledged to become the world’s first major 

carbon-neutral industrial enterprise by 2030. 

The business case is clear: out of the €100 

million investments in energy-efficiency 

technologies, we expect annual savings of at 

least €20 million. Our environmental portfolio 

helped customers and partners reduce their 

CO2 emissions by 521 million metric tons. 

That’s around ten times New York’s annual 

carbon-dioxide output. And it generated 

revenues of €36 billion in 2016. 

While governments have an important 

role to play by establishing the requisite 

frameworks and policies; businesses, 

communities and cities cannot afford to 

delay action. Our vulnerability to climate 

change can carry a very high price tag. 

Whereas investing in green technologies 

can create jobs, lower costs and improve 

quality of life. So what are we waiting for? 

75

© Jean Revillard / Rezo.ch 

INNOVATION 

Existing clean technologies and 

processes are profitable and could 

divide by two the energy consumption 

of the world and therefore the CO 2 

emissions. 

76

1000 

INNOVATION 

PROFITABLE 

SOLUTIONS 

TO SOLVE 

CLIMATE 

CHANGE 

Dr Bertrand Piccard, Psychiatrist and 

Explorer, Initiator and Chairman of 

the Solar Impulse Foundation 

When I was flying with my solar 

plane over the Atlantic Ocean, 

I remember looking at the sun 

that was giving energy to my four electric 

motors and their huge propellers. There 

was no noise, no pollution, no fuel… and I 

could fly for ever. At one moment I thought, 

“This is science fiction, I’m in the future.” 

And then I realised, “No, it’s completely 

wrong, I’m in the present. This is what the 

technologies of today already allow me to 

do. It’s the rest of the world that is in the 

past, with old and ineff icient devices.” 

A rough estimation shows that existing 

clean technologies and processes could 

divide by two the energy consumption 

of the world and therefore the CO 2 

emissions, if only they were implemented. 

Thousands of them are available 

everywhere, for everyone to use, but 

who knows about them? They are often 

hidden in start-ups or research labs. So 

few people realise how profitable, for 

both the industry and the planet, they 

have become! They create jobs, generate 

profit and boost economic growth. 

I have always said that protection of the 

environment would become a reality only 

if it requires no financial or behavioural 

sacrifices. Who would renounce driving 

their car or heating their house because 

of sea levels rising in 20 years’ time? The 

truth is that today, even if climate change 

didn’t exist, building clean and eff icient 

infrastructures would make sense. They 

represent the greatest industrial market 

ever, with the introduction of electric 

mobility, fully insulated constructions, 

heat pumps and LED lighting, smart grids 

and modern industrial processes. And 

77


INNOVATION 

for the protectors of the environment, a 

clean growth is certainly better than the 

dirty status quo we have today. That’s a 

win-win situation. 

An encouraging sign of this is the rapid 

expansion of the green bond market, 

which doubled to almost US$83 billion 

after the signature of the 2015 Climate 

Agreement. Investors are beginning 

to take into account the threats – slow 

growth trap, low interest rates – of being 

addicted to fossil fuels. Investing in these 

new solutions is the next driver of real 

economic development. 

But to reach the objectives set in Paris and 

keep global warming below the 2 degree 

mark, public and private sector investment 

in clean energy needs to reach at least US$1 

trillion per year by 2030, starting now, as 

shown in the New Climate Economy 2015 

report. Although US$1 trillion per year might 

seem a huge amount, we need to consider 

this a profitable investment rather than an 

expensive cost. So the more we invest, the 

more we will earn. 

Yet, we keep setting goals and objectives 

for 2050, 2040, 2030 at best. I hate this, 

because it is too far away – no one feels 

accountable or responsible for such a distant 

target! Decision-makers need to focus 

on solutions and shorter-term achievable 

goals as part of their roadmaps for action. 

An ambitious legal framework would pull 

innovative products to the market instead of 

leaving everybody in uncertainty. 

78 

Last year Solar Impulse completed 

the first solar flight around the world, 

demonstrating that clean technologies 

can make a plane fly perpetually with no 

fuel. Today the second part of my vision 

has started: selecting 1000 profitable 

solutions to protect the environment by 

COP24. I will then personally go around 

the world again, to deliver those same 

solutions to governments, companies 

and institutions, and we shall of course 

also make them available for everyone to 

access and use. 

Things have been rapidly falling 

into place. Several partners have 

extended their support to the Solar 

Impulse Foundation (www.solarimpulse. 

com) to create the World Alliance for 

Efficient Solutions. We have entered into 

close collaboration with a number of 

international institutions, states as well 

as cities over the world. We have already 

gathered more than 500 members 

bringing solutions that are designed to 

be both profitable and environmentally 

friendly. In parallel, we are growing a 

network of independent experts who will 

assess the solutions from a technical and 

financial standpoint. 

This is my new challenge and I do 

need all of you for that: demonstrate that 

solutions to solve climate change not only 

work, but are profitable and can improve 

the quality of life on Earth; that they are 

‘logical’ rather than simply ‘eco-logical’. 

Together we can make what was 

possible in the air, possible on the ground. 

We need to start telling ourselves, and our 

political leaders, that clean solutions are 

profitable, and that change is possible, not 

only in 2050, but already today. 


Join us! 

We want to find 1000 profitable 

and clean solutions to help 

governments, companies 

and institutions meet their 

environmental targets by adopting 

more ambitious policies. If you are 

working on innovative solutions, 

seeking how to use them in your 

daily lives or are keen to invest, 

we invite you to take part in our 

next big adventure! Visit www. 

solarimpulse.com

DECARBONISING 

THE ENERGY SECTOR 

ENERGY 

Climate Action’s Adam Wentworth spoke with Dr Christoph Frei, 

Secretary General of the World Energy Council, on why innovative 

policies are key to driving progress. 

Is there a model for how national 

governments can create the right set 

of sustainable energy policies? 

There is no doubt that the energy sector 

worldwide is undergoing a dramatic 

transition in which governments are playing 

their part. Many attribute this transition 

to the need to prevent, or at least plan for 

the potential impact of, climate change 

whilst enabling access for billions more 

new energy users and this in a context of 

dramatic innovation fuelled by electrification 

of final demand, decentralisation and 

digitalisation. The drive to reduce 

greenhouse gas emissions has certainly 

been a critical stimulus to the development 

of new technologies such as solar and 

wind, which are becoming increasingly 

competitive with traditional energy systems 

based on fossil fuels and nuclear. 

Focused, innovative, well-designed 

energy policies are the key to tackling 

continued uncertainty and dynamic 

changes, if the goal of a sustainable 

energy future is to be achieved, as 

identified in our 2016 World Energy 

Council Energy Trilemma report presented 

at last year’s Clean Energy Ministerial. 

The quest to finance the transition to a 

more sustainable energy system remains 

an issue that keeps energy leaders and 

policymakers busy at work, while there 

is a growing acknowledgement that 

adaptation to new resilience challenges, 

new digital solutions and smart innovation 

as well as regional interconnection will 

be key parts of the solution. If we are to 

The one thing, above everything 

else, that is keeping energy leaders 

awake at night is the impact of 

digitalisation. 

successfully meet the Trilemma goals of 

security, sustainability and equity, leaders 

need to come up with innovative policies 

and look beyond the energy sector, which 

will require changes to the economy, 

to our transportation, manufacturing, 

construction and agricultural sectors. 

The forecasts for growth in the 

renewable energy sector have 

confounded many expectations. Do 

you think the current high levels of 

capacity can continue? 

We have seen a dramatic increase of 

unconventional resources and no less 

dramatic technology improvement in the 

renewables space over the past decade, 

in particular, driven by wind and solar. 

In 2015, the share of renewable energies 

in total global power generation was 

23 per cent, exactly the same figure as 

in 1970. This is going to change within 

the next 45 years. In our latest World 

Energy Scenarios report, which sets out 

three potential pathways for the energy 

sector to 2060, we see a strong increase 

in the share of renewable energies. The 

share being up to two third by 2060 – 

depending on the respective scenario. 

In other words, most of the new power 

generation will be covered by renewables, 

with the use of coal as a prime energy 

source in decline. 

What are the main issues renewable 

energy will face once it becomes a 

mainstream energy source? 

Renewables such as solar, wind and 

hydropower now account for about 30 per 

cent of the total installed power generating 

capacity and 23per cent of total global 

electricity production and will continue to 

grow. However, more progress is urgently 

needed to scale up action on energy 

efficiency. Given the intermittency of energy 

from renewable sources, we have to rethink 

the system from one where supply follows 

demand to one where demand follows 

supply. This will be enabled by progress 

in demand response, sector coupling, 

smart grids and ultimately an internet of 

things in energy, all different features of 

79

ENERGY 

In the past 45 years, the average 

rate of decarbonisation has been 

around 1 per cent per year. To keep 

temperature rises below 2°C, this 

needs to be 6 per cent, per year. 

the digitalisation in energy. With a less 

concentrated, more material intense and 

more decentralised nature of the system 

issues such as recycling of (scarce) 

materials will also become more important. 

Are there any sectors in particular 

which are facing real challenges in 

being able to make the transition to a 

low-carbon future? 

Transitioning global transport currently 

forms one of the hardest obstacles to 

overcome in an effort to decarbonise 

future energy systems. Take Germany 

for example: Between 1990 and 2016, 

a reduction in CO 2 

emissions of 24 per 

cent was achieved, but the transport 

sector contributed 0 per cent to this 

development. However, according to our 

scenarios work, globally, we will see an 

increase in the electric vehicle share of 

the light-duty vehicle fleet from 2.5 to 2.7 

times by 2060. Different scenarios show 

oil’s share in transport decreasing from the 

92 per cent it is at today to between 78, 67 

and 60 per cent. 

Advances in second and third 

generation biofuels make substantial 

headway in all three scenarios, ranging 

from 10, 16 and 21 per cent. In addition, 

two of our scenarios see rapid penetration 

of electric and hybrid plug-in vehicles 

globally, which reflects 26 to 32 per cent 

of the light-duty vehicle fleet in 2060. 

We have recently seen France and the 

UK announcing the end of diesel and 

gasoline by 2040, the German Parliament 

having discussed a similar measure 

possibly before that. Most importantly, 

China’s Government is considering such 

measures and this would be a game 

changer for transport if it went ahead. The 

world’s largest vehicle market would then 

march to a tipping point and pull others 

to follow. 

80 

The World Energy Council has just 

finished its World Energy Week and 

Executive Assembly. Were there any 

clear themes on sustainability which 

emerged from the discussions? 

Decarbonisation is only part of the transition 

story. Electrification of final demand 

combined with decentralisation and 

digitalisation define an incredible space 

of innovation in terms of technology and 

business models. Our 2017 World Energy 

Trilemma report assesses decentralisation 

and its potential impact on backbone 

infrastructure and discussions at the World 

Energy Week highlighted the related 

uncertainties and raise questions about 

solidarity, cyber security, and competition 

between incumbents and new players. 

The research behind our Energy 

Trilemma report this year, has attempted 

to gauge the potential impact of the 

energy transition, and in particular, 

decentralisation, on the wide range of 

energy systems that exist in different 

countries around the world. Renewables 

and digital innovation open-up 

opportunities for new entrants who can 

compete to provide prosumers with an 

array of new services, act as aggregators, 

deliver new forms of supply and system 

support products, and compete with 

existing assets. 

Implications and opportunities differ 

greatly in developed countries with 

established transmission infrastructures, 

compared with developing and emerging 

countries where access to energy is still 

a major obstacle to be overcome and 

where rural entrepreneurs offer solutions 

in a space that previously was simply left 

in the dark. 

What is the World Energy Council’s 

role in promoting responsive and 

responsible leadership? 

The Council is the largest global network 

of energy leaders and practitioners 

dedicated to delivering a sustainable 

energy system for the greatest benefit of 

all. Originally intended as an organisation 

to manage a gathering of energy experts, 

we have evolved into one of the world’s 

most influential energy organisations with 

our leadership dialogue focused on the 

energy transition. 

We continue to deliver on our original 

goal by organising the world’s largest allenergy 

event, the World Energy Congress. 

In addition to global and regional 

Energy Leaders Summits and Ministerial 

Roundtables as well as national dialogues 

aimed at supporting policymakers, 

experts and industry leaders as they 

seek solutions to shape and successfully 

master the transition. 

The Council also publishes authoritative 

studies – our World Energy Scenarios, 

Trilemma, Issues Monitor and innovation 

work – to help further the vision of a 

sustainable energy future and promote 

responsive and responsible leadership. 

As the UN-accredited global energy body, 

we work with governments, agencies 

and companies to help inform policy 

development and strategic decisionmaking 

and planning. 

Are there any new technologies 

or innovations in energy which 

are exciting you, or could be 

transformative in the future? 

If the Grand Transition is driven by 

a combination of factors including 

decarbonisation, electrification of final 

demand, decentralisation, digitalisation and 

resilience to new physical risks such as 

extreme weather, cyber or the energy water 

food nexus, a number of specific innovation 

areas capture particular attention. 

The one thing above everything else 

that is keeping energy leaders awake at 

night is the impact of digitalisation on 

the future of the energy system. New 

business models and digitalisation will 

define momentum on a path of innovation 

which will change the way we produce 

and use energy in industrialised and 

developing worlds; and how the resulting 

transformation will drive new realities and 

priorities in global energy governance. 

We see a world where big data, 

machine learning, and artificial

Dr Christoph Frei, Secretary General 

of the World Energy Council 

ENERGY 

81

ENERGY 

intelligence enable automated system 

analytics and instant demand response 

is very different from the analogue 

world where many leaders started 

their careers. Predictive maintenance 

and supply chain management can 

dramatically decrease outage times 

and offers entirely new opportunities 

in traffic and congestion management. 

We also see a world in which the 

internet of things and blockchains 

will enable direct and low-cost 

transactions between parties and 

between appliances is fast approaching, 

with at its core precisely recorded 

transactions in unfalsifiable ledgers 

that also open new possibilities for 

supply chain tracing and product 

labelling by fabrication origin, materials 

used or emissions caused. Blockchain 

is an issue that is currently on the 

top of Energy Leaders’ list of critical 

uncertainties. 

Other areas of critical interest are 

storage and e-mobility as these have great 

potential to accelerate decarbonisation 

82 

in transport, or new platform business 

models as these have the potential to 

leverage existing assets in new utilisation 

areas – think of fridges or electric boilers 

combined with electric storage services. 

Last but not least, mobile banking 

supported by cloud technology is already 

today enabling micro-leasing schemes for 

rural households in the developing world 

and revolutionising opportunities also in 

the energy access space. 

These new technologies and business 

models will not only change the way 

we operate the energy system but will 

revolutionise the potential for a sharing 

and leasing economy in energy. 

Do you have any aspirations for what 

COP23 can, or should, achieve? 

Do you have a key message to 

attendees? 

The UN Climate Change Conference 

(COP23 Fiji) in Bonn comes at a time 

when it is no longer sufficient to maintain 

the momentum. In the past 45 years, 

the average rate of decarbonisation has 

been around 1 per cent per year. To keep 

temperature rises below 2°C, this needs 

to be 6 per cent, per year. This requires 

a revolution, not an evolution. Another 

way of trying to put a value on the rate 

of decarbonisation is to look at fossil 

reserves. We currently have an equivalent 

of 2,800 Gt CO 2 

in proven reserves of 

coal, oil and gas, but to not exceed the 

2°C target, we could only emit 1,000 Gt of 

CO 2 

. Behind these figures hides potential 

for geopolitical tension, which has to 

be overcome. The Paris Agreement got 

us one third of the way to meeting the 

temperature change target and we see 

many countries introducing concrete steps 

post-Paris. 

We now need to take the next leap 

in closing the ambition gap, delivering 

on implementation and accelerating 

on innovation. The world is now on 

a trajectory where only a climate of 

innovation will allow us to navigate the 

way to a truly sustainable energy future 

for the greatest benefit of all.

Let’s create a world 

that runs entirely on 

green energy. 

A decade ago, as DONG Energy, we started transforming 

from a black to a green energy company. Today, as Ørsted, 

we have become a global leader in offshore wind. In 2017, 

we succeeded in driving the cost of offshore wind below 

that of new coal and gas power. By 2023 we will no longer 

use coal and have reduced our CO 2 emissions by 96% 

compared to 2006.

ENERGY 

INTEGRATING 

RENEWABLES 

INTO OUR 

ENERGY 

SYSTEMS 

Credit: Renewables 2017 Global Status Report, Paris, REN21 Secretariat 

Wind Power Works, Rio do fogo, 

Rio Grande do Norte, Brazil 

84

Christine Lins, 

Executive Secretary of REN21 

When REN21 was founded in 2004, 

the future of renewable energy 

looked very diff erent from what 

is possible today. No one imagined back 

then that nearly 60 per cent of newly added 

power capacity would be renewablesbased 

– but that is what we see today. No 

one imagined that tens of millions of homes 

and businesses would add solar PV to 

their rooftops so rapidly. No one imagined 

that China would go from being a minor 

player to a global leader in less than ten 

years. No one imagined that emerging 

economies and developing countries would 

attract nearly 50 per cent of global annual 

renewable energy investment, totalling 

US$250 billion by the end of 2016. 

Today, we can categorically state that 

the worldwide diff usion and uptake of 

renewable energies has outstripped all our 

expectations. The expansion of renewable 

energy technologies has been driven 

by a changing global policy landscape 

that has drawn investments and created 

attractive markets. In turn, economies of 

scale and technology advances have led 

to decreasing costs and fuelled sustained 

growth in the sector. 

A handful of countries have led the way, 

developing innovative policies that have 

driven much of the change witnessed over 

the past decade. The challenge now is 

how to integrate high shares of renewables 

into the energy system. Today, the 

‘Energiewende’ model – the transition to a 

sustainable economy based on renewable 

energy and energy eff iciency – is inspiring 

many countries around the globe. 

While power systems have always 

had to accommodate variability in both 

supply and demand, the growing adoption 

of variable renewable energy (VRE) is 

changing how power systems are planned, 

designed and operated. The variability 

of output from solar and wind power 

requires more flexibility from the rest of 

the power system, including generating 

resources, distribution networks and even 

electricity consumers. The myth that fossil 

and nuclear power are indispensable to 

provide ‘baseload’ electricity supply when 

the sun is not shining or the wind is not 

blowing has been shown to be false. 

In areas where demand is growing 

(notably in developing economies), there is 

an opportunity for new and less-established 

power systems to grow in concert with 

higher shares of renewable generation, 

as more flexible systems are developed. 

85 

ENERGY

ENERGY 

Credit: ABENGOA 

A solar parabolic trough plant 

in Solana ,Arizona, USA. 

It is already possible to avoid lock-in of 

traditional baseload generation by using VRE 

to provide low-cost, clean energy access 

and while avoiding costly investments in 

traditional, and less flexible, generation and 

grid infrastructure. And this is good news for 

the climate as renewable resources have low 

greenhouse gas emissions. 

Discussion about 100 per cent 

renewable energy is also gaining 

prominence. It is further fuelled by the 

growing evidence that renewable energy 

when paired with energy efficiency is in 

many cases the most cost effective option 

today. In order to reach 100 per cent 

renewable energy a systems approach 

to energy – where the generation and 

use of renewable energy is looked at 

from a cross-cutting perspective – needs 

to be adopted. This includes looking 

at supporting infrastructure such as 

transmission and distribution networks, 

balancing supply and demand measures, 

energy efficiency measures and sector 

coupling, as well as a wide range of 

enabling technologies. The inclusion 

of social participation, in the form of 

universal energy access, socio-economic 

co-benefits and the empowerment of 

marginalised social groups and local 

communities is also part of the approach. 

Renewable energy coupled with 

innovative approaches present myriad 

benefits that set them apart from their 

86 

traditional counterparts. They draw 

on local resources, can be installed 

quickly in centralised or decentralised 

configurations and, unlike traditional 

systems, are not hampered by a lack of 

existing infrastructure. They do not emit 

greenhouse gases or other pollutants 

during generation and generally require 

little water to operate. Due to their 

decentralised nature, they can also 

improve system security in the face of 

extreme events due to climate change. In 

the power sector VRE is now the lowestcost 

source of newly constructed power 

generation available in many parts of the 

The growing 

adoption of 

variable renewable 

energy (VRE) is 

changing how 

power systems are 

planned, designed 

and operated. 

world, thanks to rapidly declining capital 

costs and zero fuel costs. 

REN21’s latest Renewables Global 

Futures Report documents an 

overwhelming consensus that renewable 

power will dominate in the future. The 

key lesson for integrating large shares 

of variable renewable generation is to 

ensure maximum flexibility in the power 

system. A shift away from the traditional 

‘baseload thinking’ in power system 

planning and operations will facilitate 

optimal integration of growing shares of 

VRE while providing on-demand, reliable 

and affordable electricity. 

There is broad consensus among the 

world’s leaders that we need to work 

together to mitigate climate change. 

Increasingly countries are on a pathway 

to decarbonise their energy sectors, and 

more and more corporations are joining 

them in this endeavour by subscribing 

to ambitious renewable energy targets. 

As VRE resources and other enabling 

technologies – including storage, demand 

response and efficiency improvements 

– continue to achieve more favourable 

cost and performance characteristics, the 

incentive to deploy them will continue to 

increase. The resulting changes will move 

both new and existing power systems 

further towards a model of flexible, clean, 

renewable generation. This is good news 

for our climate.

* 

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We make what matters work.

ENERGY 

AFRICA’S 

RENEWABLE 

ENERGY: 

CHALLENGES AND 

OPPORTUNITIES 

The geographical spread of renewable energy 

resources in Africa gives each region a comparative 

advantage that can be used for its benefit... However, 

despite the enormous potential, many of these resources are 

not fully developed. 

88

Dr Amani Abou-Zeid, Commissioner 

for Infrastructure and Energy at the 

African Union Commission (AUC) 

Africa has vast renewable energy 

resources including hydro, solar, 

wind, geothermal and biomass, 

spread throughout the continent. 

Hydropower worth about 12 per cent of 

the world’s technically feasible potential 

is found in Africa, and could generate 

over 1,800TWh/yr of electricity. Though 

available in most parts of the continent, 

huge hydropower resources are located 

in central, eastern and southern regions of 

Africa. The continent’s largest hydropower 

site with a capacity of well over 30,000 

MW, the Grand Inga project, one of the 

African Union’s flagship projects, is found 

in the Democratic Republic of Congo. 

Geothermal energy is predominantly 

found in the east African region, and its 

potential is estimated at over 15,000 MW. 

Solar and wind energy resources are 

found throughout the continent; however, 

the Sahara desert and other arid areas 

off er excellent locations for diff erent 

types of solar energy development. A 

huge variety of biomass resources are 

distributed in all regions, with the reserves 

of woody biomass alone estimated at over 

70 billion tonnes. 

The geographical spread of renewable 

energy resources in Africa gives each 

region a comparative advantage that 

can be used for its benefit, as well as 

promoting synergy with the rest of the 

continent, providing reliable least-cost 

energy. However, despite the enormous 

potential, many of these resources are 

not fully developed. According to the 

International Renewable Energy Agency 

(IRENA), Africa’s installed capacity from 

renewable energy in 2016 was 38.3GW, 

which was about 2 per cent of the global 

renewable energy installed capacity of 

2,008GW. The African Union Commission 

(AUC), working closely with regional 

economic communities, member states 

and development partners, has designed 

programmes aimed at promoting the rapid 

development of African renewable energy. 

This requires the participation of public 

sector, private sector and civil society, 

including community-based initiatives 

and small and medium-sized enterprises 

(SMEs). One of the critical areas to 

address to pave the way for diff erent 

actors is the energy market structure. 

The AUC, in cooperation with regional 

economic communities, power pools, 

specialised pan-African organisations and 

member states, is working to develop a 

continental energy market that enhances 

eff iciency and competitiveness; and support 

private sector participation to complement 

public sector resources. A Strategy and 

Action Plan for the harmonisation of policy 

and regulatory frameworks have been 

developed and adopted by the specialised 

ENERGY 

The Olkaria II Geothermal 

Power Station in Kenya 

89

ENERGY 

Technical Committee of Ministers 

responsible for the sector. 

The Action Plan is structured into 

three terms: short (3-5 years: 2017-2021), 

medium (6-8 years: 2022-2024) and 

long (9-14 years: 2025-2030). To ensure 

the development of regional electricity 

markets in Africa, the Plan supports 

policy and legislative instruments, as 

well as other measures to be taken at 

the national, regional and continental 

levels. A continental electricity market will 

create opportunities where each region, 

through its power pool, can place its most 

competitive energy into the market. It 

will also enhance the reliability of supply, 

as well as enabling interdependence 

of different regions for reserve margins 

and peak support, by making use of 

such elements as different time zones, 

differences in peak time, hydrological 

seasonality, and intermittency of resources 

such as wind and solar. 

To develop the renewable energy 

resource on the continent, the AUC is also 

focusing on the infrastructure development 

that will enable the interconnection of all 

regions through high voltage transmission 

lines. Key transmission corridors linking 

regions and connecting generation 

resources to demand centres have been 

identified under the Programme for 

Infrastructure Development for Africa 

(PIDA). These transmission corridors are 

at various stages of implementation under 

the coordination of the AUC and NEPAD 

Planning and Coordination Agency (NPCA). 

One of the challenges facing the 

African continent is low access to modern 

energy services, with more than 600 

million people lacking connections to 

90 

The Grand Inga project in the Democratic Republic of Congo is Africa’s largest 

hydropower site with a capacity of well over 30,000 MW 

electricity. To address this challenge 

through renewable energy resources, AUC 

is also developing specific interventions 

for specific types of renewables. The 

Commission’s small hydropower, 

bioenergy and solar energy programmes 

aim at benefiting local communities for 

domestic as well as productive uses. 

These programmes are the focus of 

Renewables planning 

To take full advantage of the 

opportunities that renewable 

energy resources in Africa present, 

it is necessary to ensure that: 

• The harmonisation of the 

regulatory frameworks is 

implemented, and member 

states and power pools that 

require support are assisted. 

• Missing links in the 

interconnection of electricity 

networks across the continent 

are fast-tracked to completion. 

• Innovation is embraced, both 

in technology and business 

models, in order to accelerate 

the rate of energy access using 

renewable energy resources. 

• Development of decentralised 

systems is encouraged, along 

with the introduction of business 

models that embrace different 

players in the energy market – 

including SMEs and non-state 

actors. 

policy guidelines, building capacity 

and designing appropriate frameworks 

for adoption by member states. The 

AUC is currently developing technical 

and commercial regulatory models 

for micro and mini grids that member 

states can adapt to suit their specific 

requirements. The Commission is also 

building a collaboration network with the 

Regional Centres for Renewable Energy 

and Energy Efficiency to strengthen the 

flow of information and dissemination 

of continental programmes to the areas 

where they are most needed. This network 

will also encourage peer learning among 

the centres. 

In addressing policy and strategy 

concerns affecting renewable energy in 

Africa, it is important to address specific 

challenges that are unique to various types 

of renewables. In the case of geothermal, 

the risks are present in the upstream 

stage development during surface studies, 

exploration drilling and appraisal drilling. 

These make it difficult for member states 

to attract private investment in the sector; 

and the few investors that undertake this 

mark up their prices significantly. The 

AUC, together with development partners 

including the DFID, kfW, New Zealand, 

Power Africa and Germany, have designed 

the Geothermal Risk Mitigation Facility 

(GRMF) to support private and public 

developers during the upstream phase. 

The GRMF provides grants for feasibility 

studies, exploration drilling and appraisal 

drilling. In addition GRMF supports capacity 

development for developers through 

technical training. Since its establishment 

in 2012, GRMF has supported 27 

developers, both private and public, over 

four application rounds and has awarded 

grants worth US$97 million. Building on 

this experience, the AUC has developed 

Africa Geothermal Drilling Code, adapted 

from New Zealand, and has set up a 

Regional Geothermal Centre of Excellence 

based in Kenya, which is a leading light in 

geothermal development in Africa. 

In the case of small hydropower 

development, the starting point is 

mapping of the resource to establish 

the actual potential and identify sites to 

which developers can be directed. Further, 

capacity development for technicians to 

carry out operation and maintenance of 

the plants is crucial. The AUC is designing 

a programme to address these issues, 

starting in 2018.

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CGCB-A10146-00-7600

ENERGY 

ARE INDIA’S 

RENEWABLE 

ENERGY 

TARGETS 

OVER 

AMBITIOUS? 

92

Leena Srivastava, 

Vice Chancellor of TERI University 

India ratified the Paris Agreement just 

over a year ago. A cornerstone of 

India’s commitment towards climate 

action is its acknowledged ambitious 

target on renewable energy. Starting with 

a relatively modest target of 20GW of 

renewable energy by 2022 (announced in 

2008), India rapidly scaled up this ambition 

to 175GW (in January 2015)! Undoubtedly, 

the rapid progress on renewable energy 

technologies and the trend of rapidly 

declining international prices, combined 

with the growing demand for, as well 

as shortages of, energy gave India the 

confidence that this would be a win-win 

commitment for the country. 

As part of its pledges under the Paris 

Agreement, India has said that it will 

produce 40 per cent of its energy through 

non-fossil sources by 2030 – placing the 

renewable energy target in that year in the 

vicinity of an estimated 300GW. 

So, how is India faring in meeting 

its ambitions? On the positive side, the 

continuing ambitious pronouncements 

of the government are keeping the 

industry excited. The lowest solar power 

bid that the country saw in May 2017 was 

Rs2.44/unit – significantly lower than 

coal thermal prices of around Rs3.20 

per unit and a solar power bid of Rs2.97 

in February of the same year. Earlier 

in October 2017, the bid price for wind 

power projects in the country saw tariffs 

fall to Rs2.64 per unit. No surprise then 

that there seems to be a rethink on coal 

power generation in the country. 

On the negative side, however, the 

initial euphoria on the renewable energy 

sector in the country is being tempered, 

if not already leading to anguish. There 

are several reasons for this. First, the 

extremely low discovery prices for solar 

and wind power in certain places are, 

in turn, leading to extremely aggressive 

ENERGY 

The extremely low discovery 

prices for solar and wind power in 

certain places are leading to extremely 

aggressive negotiation by procurers in 

other locales. 

93

ENERGY 

100 

80 

Figure 1: India’s 2022 renewable energy target 

20 GW 

Utility scale 

solar projects 

Capacity (InGW) 

60 

40 

20 

0 

5 GW 

10 GW 

60 GW 

40 GW 

40 GW 

Rooftop 


Ultra mega park 


Source: ET Energyworld 

Small Hydel Projects Biomass Wind Solar 

Source of renewable energy 

Driven from the highest level of 

government, all actors sought to align 

themselves quickly to the needs of the 

sector. 

negotiation by procurers in other locales 

as well, pushing developers to lower 

prices, even below their winning bids! 

In some instances, existing contracts 

have been reopened for re-negotiation. 

As a result of such factors, financial 

institutions have become wary of 

renewable energy projects and are not 

enthusiastic about lending support to 

them. The market is thus beginning 

to see a number of winning bidders 

seeking to sell their projects even before 

starting work on them. 

The poor state of the centralised 

grid infrastructure as well as the poor 

financial health of the renewable energy 

procurement entities (the distribution 

companies) has further eroded the 

confidence of financial institutions on the 

risks, and the financial viability, of such 

projects. Unfortunately, the government’s 

attempts to address these bottlenecks 

seem to be too little and too late for some 

of these projects. 

The solar rooftops programme in the 

country is not taking off at the desired 

speed, for many reasons ranging from 

practical problems on the ground from 

taxation structures, to multiple uses of 

roof space, a weak confidence in systems 

and performance as well as a reluctance 

on the part of distribution utilities to 

support this scheme. 

Preparation on the supporting 

environment is often inadequate to allow a 

timely delivery of desired outcomes – be it 

related to buy-in from state governments, 

land acquisition, strength and modernity of 

the grid infrastructure, presence of market 

actors along the value chain or indeed 

the capacities that exist within policy and 

regulatory bodies to quickly and effectively 

deal with emerging challenges. 

And finally, the ability may be lacking 

to cope with the rapidly evolving 

technological solution space and the 

capability to be able to look at integrated 

systemic solutions. 

Despite the daunting difficulties, it is 

also a fact that India will still have a much 

larger renewable energy capacity in 

place by 2022 than it would have without 

such ambitious goals. It has proved to 

the world that when political ambition 

exists then outcomes will follow willy-nilly. 

The pressure to deliver on the ambition 

combined with the need to keep tariffs low, 

in a price sensitive economy like India’s, 

has forced it to adapt global innovations 

as well as to innovate itself on things such 

as the reverse bidding process for price 

discovery. Driven from the highest level 

of government, all actors sought to align 

themselves quickly to the needs of the 

sector and challenges are being addressed 

as they emerge. 

Could India have done things differently? 

Yes, it could have ensured a more systemic 

planning and roll-out of activities; it could 

have built capacities in the policy and 

regulatory bodies, institutions and other 

stakeholders first; it could have examined 

and refined the various laws that would 

have enabled a smooth implementation of 

rooftop solar systems; and it could have 

sought to strengthen and modernise its 

grid infrastructure, among other measures. 

But a sequential approach of this kind 

would not have guaranteed a problem-free 

transformation of the economy towards 

greater renewables, nor would it convey the 

sense of urgency with respect to climate 

action that India is succeeding in doing – 

for its own populations and the world. 

94

CATALYSING 

AFFORDABLE, 

RELIABLE AND 

EFFICIENT 

ENERGY IN 

THE U.S. 

ENERGY 

As an international leader in energy 

technology, development and 

delivery, the U.S. is not just making 

promises about clean energy and energy 

efficiency, we are acting on them - and 

our actions are proving that you can drive 

economic growth while also upholding 

environmental stewardship. 

Energy productivity is an important 

driver of economic prosperity in America. 

Since 1970, the size of the U.S. economy 

has tripled and energy productivity has 

more than doubled. That means for every 

kilowatt hour and gallon of gasoline 

we consume we are getting twice as 

much economic output. Consumers are 

also dedicating a smaller percentage of 

household spending to energy than at any 

other time on record. This has occurred 

through decades of scientific innovation 

and entrepreneurship. The Department of 

Energy’s (DOE’s) 17 National Laboratories 

have played an important role in this 

scientific innovation, helping to improve 

the efficiency of many products and saving 

money for their users. 

One such example is refrigerators. 

Today, refrigerators use about a quarter 

Daniel Simmons, Acting Assistant 

Secretary, Office of Energy Efficiency 

and Renewable Energy (EERE), U.S. 

Department of Energy 

The energy America is producing 

today is not only more efficient, but 

also more affordable and cleaner than 

ever before. 

95

ENERGY 

of the energy they used in 1980, while 

being bigger, having more features, yet 

costing half of the price. Another example 

is lighting. Between 2008 and 2015, DOE’s 

early-stage research on LED lighting 

helped contribute to costs dropping 

nearly 90 per cent. This rise in efficiency 

has led to a massive increase in market 

adoption of these lights, going from under 

100,000 bulbs to more than 200 million 

A-type bulbs in the country. Over 270 

patents have resulted from DOE research 

and development and have contributed 

to more than $2.8 billion in U.S. energy 

savings to date. We want positive changes 

in energy efficiency like these to continue. 

The energy America is producing 

today is not only more efficient, but 

also more affordable and cleaner than 

ever before, whether that be energy 

from coal, oil, natural gas, nuclear, or 

renewables. For example, the hydraulic 

fracturing revolution has cut oil prices 

in half and made natural gas three times 

less expensive than it was a decade 

ago. Levelised costs for wind and 

The DOE is eager to continue 

work with our international partners 

on policies that will expand access 

to affordable, reliable, and efficient 

energy to promote economic growth 

and energy security. 

solar technologies have also declined 

substantially in recent years, leading to 

increased renewable penetration in many 

parts of the country. 

Meanwhile, air quality is improving 

dramatically. According to the 

Environmental Protection Agency (EPA), 

from 1970 to 2016, U.S. GDP grew by 

253 per cent; vehicle miles traveled 

increased by 190 per cent; overall energy 

consumption increased by 44 per cent; yet 

total air pollution (or criteria pollutants) fell 

by 73 per cent. 

With the modern technology we have 

access to today, our country, and the 

world, have an immense amount of clean 

energy resources to choose from. Over 

the past three decades, the U.S. coal fleet 

alone has dramatically reduced emissions 

of air pollutants: Since 1970, Nitrogen 

Oxides (NOX), Sulfur Dioxide (SO2), and 

airborne particulates (PM) emissions 

(per kWh of electricity generated) have 

decreased by 85 to 93 per cent. 

The Department’s Clean Coal 

Technology program laid the foundation 

for many commercially successful coal 

Comparison of Growth Areas and Emissions, 1980-2016 

96

ENERGY 

Between 2008 and 2015, DOE’s 

early-stage research on LED lighting 

helped contribute to costs dropping 

nearly 90 per cent. 

technologies that have significantly 

reduced air pollution and improved the 

environment—making today’s stateof-the-art, 

coal-fired power plants 

have a much smaller environmental 

footprint. For a new pulverised coal 

power plant, the implemented pollution 

controls reduce NOX by 85 per cent, 

SO2 emissions by 98 per cent, and PM 

by 99.9 per cent, when compared to 

an older plant that does not have these 

pollution controls. 

We also recognise the vital role 

of nuclear as a carbon dioxide-free 

technology. DOE is a world leader in 

advanced nuclear energy technologies 

research. This fall, the International 

Atomic Energy Agency designated two 

of our national labs, Oak Ridge National 

Lab and Idaho National Lab, as an 

International Centre based on Research 

Reactors. This designation makes the 

U.S. one of only four countries identified 

for unique capabilities and excellence in 

nuclear energy research. Nuclear energy 

is one of the most affordable, reliable, and 

clean energy sources on Earth, so it’s 

important that we utilise this resource to 

its fullest capability. 

Clean coal and nuclear are just 

two sources to our country’s diverse 

energy mix. DOE remains committed 

to a comprehensive energy strategy 

to ensure we are utilising all of our 

abundant, American energy resources, 

including coal, nuclear, natural gas, 

oil, and renewables. We hope our 

international partners will also undertake 

this same strategy to ensure energy 

affordability, security, and reliability 

throughout the world. 

International cooperation is critical 

to achieving our goals. Last month, I 

participated in the U.S.-China Energy 

Efficiency Forum in Denver, Colorado, 

where more than 150 U.S. and Chinese 

leaders and experts exchanged 

information on energy efficiency 

technologies, policies, and programmes. 

I discussed the Administration’s 

commitment to international leadership 

on energy issues. 

U.S. Secretary of Energy Rick Perry 

has made it a point that the U.S. wants to 

strengthen our international partnerships. 

At the Clean Energy Ministerial in Beijing, 

Africa Oil Week in South Africa, and 

other trips abroad, Secretary Perry has 

emphasised that he continues to believe 

we have extraordinary opportunities to 

be partners on the climate and clean 

energy issues. He has also authorised 

crude oil and LNG exports to several of 

our international partners, increasing jobs, 

economic stability, and national security 

across the globe. 

The DOE is eager to continue work with 

our international partners on policies that 

will expand access to affordable, reliable, 

and efficient energy to promote economic 

growth and energy security. I am confident 

that the U.S. will continue to serve as 

an example to the rest of the world on 

how to achieve economic, energy and 

environmental goals simultaneously, 

and I look forward to being a part of this 

ongoing effort. 

97

TRANSPORT 

DECARBONISING 

SHIPPING - 

A CHALLENGE 

FOR ALL 

98

Kitack Lim, Secretary General of 

the International Maritime 

Organization (IMO) 

Addressing the complexities of the 

climate change challenge requires 

a comprehensive and collaborative 

approach. No stakeholder can work on 

this alone. The global community has 

recognised this in the Paris Agreement 

and in the United Nations Sustainable 

Development Goal (SDG) 13. These 

bring nations into a common cause to 

undertake ambitious efforts to combat 

climate change and adapt to and mitigate 

its effects, with enhanced support to assist 

developing countries to do so. 

As part of the United Nations system, 

the International Maritime Organization 

(IMO) is fully committed to limiting and 

reducing greenhouse gas emissions 

from shipping. The approach taken by 

the IMO’s membership and its other 

stakeholders is based on building 

consensus and collaboration. These have 

been key to driving change at IMO. 

It is not possible to work towards 

decarbonising the maritime sector by 

working in silos. Shipping and the maritime 

sector are an essential component of world 

economic growth, with an impact across 

many stakeholders. Billions of people rely 

on shipping as the most cost effective and 

fuel efficient way to transport the essential 

raw materials, commodities and consumer 

goods that industries and communities 

need and want. 

So when we consider IMO’s responsibility 

to make sure that shipping has a minimal 

negative impact on the ocean and 

atmospheric environment, it is clear that 

we need to work closely with government, 

business, city ports, local authorities, other 

agencies, civil society groups and the 

communities that shipping serves. 

At a global level, IMO’s decision making 

process is characterised by pragmatic, 

realistic, workable, cost effective and well 

balanced decisions, in the formulation of 

which the views of all nations are taken 

duly into account. IMO has already adopted 

mandatory energy efficiency measures to 

reduce greenhouse gas emissions from 

ships, applicable to more than 96 per cent 

of the world’s merchant fleet by tonnage. 

The mandatory Energy Efficiency Design 

Index requires new ships to be built to 

be more energy efficient. And older ships 

must undergo a process to produce a Ship 

Energy Efficiency Management Plan. 

To support the implementation of these 

measures, at regional and national level, 

IMO promotes collaboration through 

its Integrated Technical Cooperation 

Programme (ITCP), which serves to assist 

governments that lack the technical 

knowledge and resources needed to operate 

a shipping industry successfully. The ITCP 

includes innovative major programmes 

specifically related to energy efficiency. 

The Global Maritime Energy Efficiency 

Partnerships Project (GloMEEP) was 

launched in 2015 in collaboration with the 

Global Environment Facility and the United 

Nations Development Programme. Under 

GloMEEP, 10 developing countries have 

committed to taking a lead role in creating 

the national policies, strategies and the 

legal framework to effectively implement 

TRANSPORT 

Consensus and collaboration have 

been key to driving change at IMO. 

99

TRANSPORT 

IMO member states have pledged 

to produce a comprehensive strategy 

for reducing greenhouse gas emissions 

from ships. 

IMO’s energy efficiency regulations. So 

far more than 400 people have been 

trained in national, regional and global 

workshops, and information tools and 

training packages have been developed to 

further support developing countries in the 

implementation of IMO’s energy efficiency 

provisions. 

A second global project, funded by 

the European Union, has established 

a network of five Maritime Technology 

Cooperation Centres (MTCCs) in Africa, 

Asia, the Caribbean, Latin America and 

the Pacific. Through collaboration and 

outreach activities at regional level, 

the MTCCs will help countries develop 

national maritime energy efficiency 

policies and measures, promote the 

uptake of low carbon technologies and 

operations in maritime transport and 

establish voluntary pilot data collection 

and reporting systems. 

IMO is also promoting collaboration 

with the private sector. The Global Industry 

Alliance to Support Low Carbon Shipping, 

known as the GIA, has been launched in 

2017 under the auspices of the GloMEEP 

project to bring like minded private 

sector players together with a common 

objective of making the shipping industry 

greener. So far, 16 maritime private 

industry champions (including shipowners 

and operators, classification societies, 

engine and technology manufacturers 

and suppliers, big data providers, oil 

companies and ports) have signed up. The 

GIA will collectively identify and develop 

solutions that can support overcoming 

barriers to the uptake of energy efficiency 

technologies and operational measures in 

the shipping sector. 

These barriers have been identified 

as technical, financial, institutional and 

human element related. Overcoming 

them requires novel approaches, blue sky 

thinking, and working together through a 

collaborative and common approach. All of 

this collaboration, from capacity building 

to research projects to innovation, will 

support IMO’s regulatory work to reduce 

shipping’s negative impact on the ocean 

and the atmospheric environment. 

Steps are already being taken towards 

considering further measures to address 

greenhouse gas emissions from ships. The 

mandatory collection and reporting of fuel 

oil consumption data for ships of 5,000 

gross tonnage and above will begin from 

2019. This will provide a firm statistical basis 

for an objective, transparent and inclusive 

policy debate in IMO’s Marine Environment 

Protection Committee (MEPC), the forum 

where all environmental matters relating to 

shipping are discussed. 

IMO member states have pledged to 

produce a comprehensive strategy for 

reducing greenhouse gas emissions 

from ships. An initial strategy is set to be 

adopted in 2018, to be revised by 2023, 

benefiting from statistical information from 

mandatory reporting. Collaboration and 

consensus will push forward this initial 

greenhouse gas strategy. 

The momentum driving this process is 

evidenced by the extensive participation 

and commitment shown in the meetings 

of the Intersessional Working Group on 

Reduction of GHG Emissions from Ships. 

The first meeting in June reported to the 

MEPC 71 session in July 2017; the second 

in October worked to develop the initial 

strategy; and the third meeting in spring 

2018 is expected to come up with the draft 

initial strategy, for adoption by the MEPC 

72 meeting in April. 

I am confident that IMO Member States 

will deliver on this. And I believe that by 

continuing to promote collaboration at all 

levels we can be positive about not just 

agreeing a strategy, but acting on it too. 

100

ACCELERATING 

THE TRANSITION 

TO ELECTRIC 

VEHICLES 

TRANSPORT 

Credit: Bloomberg 

Global passenger electric 

vehicle sales will hit about 

1 million in 2017. 

101

TRANSPORT 

Colin McKerracher, Head of 

Advanced Transport at Bloomberg 

New Energy Finance 

The global automotive industry 

is entering a period of profound 

transformation. The combination 

of supportive policy and improvements 

in lithium-ion battery technology have 

enabled electric vehicles to gain a toehold 

in a market that has been dominated by 

the internal combustion engine for over a 

hundred years. Meanwhile, tightening fuel 

eff iciency regulations and urban air quality 

concerns are putting increased pressure on 

automakers to improve the rest of their fleet. 

Global passenger electric vehicle sales 

will hit about 1 million in 2017, up from one 

hundred thousand just a few years earlier. 

There are now almost three million electric 

vehicles on the world’s roads. But before 

we get too excited about this progress, it is 

worth bearing in mind that the global fleet 

of all cars is around 1 billion. Reductions 

in emissions from road transport will be 

a key part of meeting climate targets, but 

an average vehicle is on the road for 12-15 

years, creating significant lock-in to our 

current transport system. So, just how far 

can EV adoption go and what would this 

mean for energy and automotive markets? 

Lithium-ion battery prices per kilowatthour 

dropped 74 per cent between 2010 

and 2016 and their energy density is 

improving by around 5 per cent per year. 

This puts electric vehicles on a path 

towards being fully cost-competitive with 

their internal combustion counterparts, 

a point that will be reached in diff erent 

countries from 2025 onwards. In response, 

automakers around the world are ramping 

up the number of electric models they 

off er – there are 150 diff erent plug-in 

hybrids and pure electrics available today, 

and this is set to rise to over 240 by 2021. 

Groups like VW, Daimler, Volvo and Nissan 

have made aggressive plans to electrify 

their vehicles over the next 10 years. 

China is pushing the hardest here. 

China’s 2025 auto plan calls for internal 

combustion sales to flatline and EVs to 

make up all vehicle sales growth over the 

next seven years. Its recently introduced 

‘new energy vehicle’ quota requires 

automakers to sell a set percentage of 

electric or fuel cell vehicles, which it will 

ratchet up over time. China is doing this 

not just to reduce oil imports and improve 

urban air quality, but also for industrial 

policy reasons. As the vehicle mix shifts, 

China wants to position its domestic 

automakers to leapfrog established 

international brands. A thriving, globally 

competitive auto sector is a major source 

of employment, investment and innovation. 

Nobody wants to see their national 

champions left behind. 

A view to 2040 

Each year at Bloomberg New Energy 

Finance, we publish a comprehensive 

global Electric Vehicle Outlook, in which 

we look at all the technology, policy and 

economics factors that could influence 

EV adoption over the next two decades. 

In this year’s report, we concluded that 54 

per cent of the world’s vehicle sales would 

be electric by 2040, with Europe, China 

and the U.S. the largest EV markets. Some 

countries will get there much sooner. In 

Norway – the leader on EV adoption – 

sales are already above 40 per cent and 

the government is aiming fully to phase 

out traditional vehicle sales by 2025. 

Our forecast would mean 530 million 

electric vehicles on the road in 2040, or 

around a third of the total fleet. This is a 

dramatic change from today and would 

require significant scale-up in the battery 

manufacturing supply chain, in materials, 

and in charging infrastructure. This many 

EVs would displace around eight million 

barrels per day of oil demand, and would 

increase global electricity demand by 

around 5 per cent. The power system can 

Credit: Bloomberg 

accommodate the additional demand, but 

smart-charging systems will be needed 

to ensure vehicles are not contributing to 

demand during peak periods. CO 2 

emissions 

would also fall. Even with power generation 

emissions in diff erent countries factored 

in, EVs still have a lower CO 2 

footprint per 

kilometre driven and this gap is set to widen 

further over time as the amount of renewable 

power generation grows. 

So what holds back further adoption? 

Charging infrastructure is still a major 

barrier, particularly in urban areas with 

limited off -street parking. Low average 

vehicle purchase prices and power grid 

issues in emerging economies also play a 

role. Supply constraints for key materials 

like cobalt, lithium and graphite could still 

slow down the declines in battery cost 

seen in recent years. Governments will 

need to recoup some of the lost revenues 

102

TRANSPORT 

from fuel taxes levied on gasoline and 

diesel, while consumers will need to adjust 

how they refuel their vehicles. 

Accelerating the transition 

Of course, there are several factors that 

could cause things to move much faster. 

Our analysis is based mostly on economics 

and current technology trajectories, but 

a step-change in battery density or an 

improvement in charging technology 

options would hasten the transition. 

National governments in the U.K., France, 

the Netherlands, Norway and even India 

have indicated that they want to phase 

out internal combustion engine sales 

altogether. While these targets typically 

lack specific measures, they show just how 

quickly the landscape is changing. In the 

world’s largest cities, urban dwellers are 

becoming increasingly concerned with 

poor air quality and could force municipal 

governments to move even faster than their 

national counterparts. Policy has a big role 

to play here. 

On top of all this, new mobility business 

models such as ride hailing and car 

sharing are gaining traction around the 

world. Some customers are opting to 

buy kilometres of mobility rather than a 

vehicle of their own. Autonomous vehicles 

are set to debut in the 2020s and would 

accelerate this trend. At high utilisation 

rates, electric vehicles have much lower 

costs per kilometre and could be ideal for 

these types of applications. 

The automotive sector will change more 

in the next 10 years than it has in the last 

50. We are heading towards a cleaner 

transport system, with benefits for the 

environment and for consumers around 

the world – but much work remains to be 

done. 

New mobility business models 

such as ride hailing and car sharing are 

gaining traction around the world. 

103

TRANSPORT 

A CONTINUED 

COMMITMENT 

TO GREEN 

INNOVATION 

The automobile industry has a 

storied tradition of adapting to 

an evolving market and new 

consumer tastes. Today, changes in 

the global environment are causing a 

transformation in the way we think about 

cars and individual mobility. The BMW 

Group has long been an industry leader in 

implementing green technologies, and is 

continuing to move the industry towards a 

greener future. Climate change and global 

warming require immediate action by the 

private sector to decarbonise and electrify 

production. The BMW Group already offers 

a wide variety of future mobility concepts 

and has a diverse selection of electrified 

vehicles in its product portfolio, such as 

the BMW i and iPerformance series. 

But the BMW Group’s climate strategy 

goes beyond just finished cars. Its vision 

for the future of individual mobility is 

spearheaded by an ambitious concept 

called ACES – Autonomous, Connected, 

Electrified, and Shared. This concept is 

already being implemented in the entire 

life cycle of BMW vehicles – from design 

104 

to production to ownership to recycling. 

Rather than just creating a sustainable 

end product, the BMW Group strives to 

be responsible at each and every step. 

Most importantly, the BMW Group is living 

proof that responsibility does not have 

to negatively impact profitability. On the 

contrary, the BMW Group has discovered 

the potential to reduce energy costs while 

increasing production and boosting profits. 

One important element of BMW’s 

corporate strategy has always been 

to manage its energy consumption to 

promote sustainability, while at the same 

time enhancing profitability. Now, BMW 

Energy Services, established in 2015 has 

stepped up to become a game changer 

in the energy business with its innovative 

energy solutions and new digital business 

models. For example, through the joint 

venture Digital Energy Solutions that was 

founded in 2015 together with Viessmann, 

BMW Energy Services has established 

service offers that are based on BMW 

Group competencies and technologies in 

the area of e-mobility, connected charging 

infrastructure, battery storage systems and 

energy management. 

A further example for energy 

management innovations that comprises 

energy and mobility is the BMW 

Speicherfarm Leipzig, a large scale battery 

storage farm built on the premises of the 

BMW Group plant in Leipzig. The first of its 

kind, it consists of up to 700 BMW i3 2nd 

life and new batteries that are intelligently 

warehoused as spare parts with a total 

power equaling 100,000 km in electric 

range. This battery storage farm will 

help to optimise the plant’s local energy

consumption regarding CO2 and cost but 

will also offer flexibility to the electric grid 

via demand side management from 2018 

onwards. 

For over 100 years now, the BMW Group 

has learned to lead by example. BMW 

tops the industry when it comes to green 

technology and CO2 emissions reduction. 

The Dow Jones Sustainability Index once 

again featured the BMW Group at the top 

of its rankings and as the best automaker 

of 2016. BMW plans on continuing its 

dedication to clean production and 

cleaner vehicles. 

One of BMW’s long term visions is to 

increase the share of alternative energy 

used in production to 100 per cent in the 

coming years. Currently, about 51 per cent 

of energy needs are through renewable 

energy, with power coming from sources 

like a biogas plant in Rosslyn, South Africa, 

and a brand new photovoltaic facility at 

our plant in Shenyang, China. 

To date, the BMW Group has already 

sold more than 100,000 electric vehicles 

and plug-in hybrids and now aims to 

achieve this same figure in 2017 alone. 

In this way, the BMW Group is helping 

to reduce greenhouse-gas emissions 

and improve air quality. The BMW Group 

reduced CO2 emissions of its newly 

sold vehicles in Europe by around 41 

per cent between 1995 and 2016. Our 

European vehicle fleet (EU-28) had an 

average fuel consumption of 4.6 l of 

diesel /100 km or 5.6 l of petrol per 100 

km and average CO2 emissions of 124 g 

/km (internal calculation). Our goal is to 

reduce CO2 emissions by at least 50 per 

cent between 1995 and 2020. Catering to 

our new urban lifestyles is another key 

to transforming the future. DriveNow and 

ReachNow, car-sharing services owned 

by the BMW Group, offer per-minute car 

rental in cities. 

The BMW Group is helping foster an 

important shift in individual mobility – 

away from private ownership of vehicles 

with combustion engines toward shared, 

electric, and digitalised solutions. As the 

climate changes, so does our industry. 

At the BMW Group, we proudly take 

on the challenge of innovating in a 

sustainable way. As we decarbonise 

the private sector and transform our 

economy for the future, the BMW Group 

will continue to excel at delivering quality 

automobiles and the sheer driving 

pleasure it has built its reputation on. 

The BMW Speicherfarm Leipzig is a large scale battery storage farm built on 

the premises of the BMW Group plant in Leipzig, Germany. 

Based on our own BMW Energy 

Cloud, we provide holistic energy 

solutions to our customers that 

encompass mobility and energy. 

BMW Energy Services thereby acts 

as an enabler of the BMW Group’s 

electrification strategy. 

Dr Joachim Kolling, Head of BMW Energy Services 

TRANSPORT 

105

CITIES 

The Capibaribe Park project, in Recife, Brazil, will connect over 94,000 sq 

metres of green space, walkways and bike paths along the Capibaribe River. 

RESILIENT CITIES: 

GOOD FOR THE 

CLIMATE AND 

GOOD FOR 

BUSINESS 

106

Investing in 

sustainable, resilient 

communities pays off, 

but unilateral action 

is not enough. We 

need to build bridges 

between the public 

and private sectors 

to design, fund, and 

implement resilient 

city solutions. 

One of the key messages 

from business and local 

government leaders speaking 

at the Resilient Cities 2017 

congress in Bonn. 

Gino Van Begin, Secretary General 

of ICLEI – Local Governments for 

Sustainability 

At the Resilient Cities 2017 congress in 

Bonn earlier this year, the discussions 

focused on how to turn local climate 

adaptation and resilience plans into reality 

– a reflection of the current state of play in 

the field. Over the past 10 years, ICLEI (www. 

iclei.org) has seen a steady increase in the 

number of local governments assessing their 

climate risks, developing local strategies, and 

more recently, seeking to implement their 

plans through integrated sustainable and 

resilient actions. 

Take Recife, Brazil, which has developed 

the ‘Recife 500 Years, the City we Want’ 

master plan for comprehensive sustainable 

urban development. The plan includes 

the Capibaribe Park project, which is also 

part of the ICLEI Transformative Actions 

Program. The park will connect over 94,000 

sq metres of green space, walkways and 

bike paths along the Capibaribe River, 

providing recreational and commercial 

benefits. By reducing motorised transport 

and restoring ecosystems, the project will 

decrease urban emissions by an estimated 

8,000 tons of CO 2 

per year while mitigating 

the impact of climate hazards including 

heat waves and flooding. 

Recife is not alone. Over 1,510 adaptation 

actions by cities, towns, and regions have 

been reported to the carbonn® Climate 

Registry (cCR), a global reporting platform 

with over 1,000 registered entities. In 

a subsample of 267 actions reported 

by 132 subnational governments in 35 

countries, at least 77 per cent were aligned 

with national-level goals and the Paris 

Agreement, and over half addressed both 

mitigation and adaptation. 

When implementing these actions, 

however, local governments often face 

institutional barriers from financial and 

governance systems whose regulations 

and cultures are themselves not adapted 

to enable resilient urban development. The 

Capibaribe Park project budget is US$94 

million, part of the US$620 million needed 

for the Recife 500 Years master plan. 

Municipal funding is not enough. Urgent 

support is needed from public and private 

partners to help subnational governments 

finance and implement integrated climate 

action in innovative ways. 

What does this look like? One aspect 

is reforming the global financial sector 

and reducing the perception that local 

adaptation investments are high risk and 

low reward. In 2014, a mere 7 per cent of 

global climate finance went towards climate 

adaptation, and most was inaccessible to 

subnational governments. More favourable 

legislative and regulatory conditions are 

needed along with appropriate financial 

intermediaries at the subnational level. 

Guidance is also needed for project 

preparation and governance. ICLEI and 

other members of the Cities Climate 

Finance Leadership Alliance are building 

capacity in these areas to help local 

governments develop bankable projects 

and bolster public and investor confidence. 

Another aspect is cultivating 

relationships with private sector partners 

built on mutual interest and trust. 

Copenhagen, Denmark and Oslo, Norway 

are illustrative cases. Both cities are 

working with insurers to pool resources 

and expertise – such as in risk modelling 

and asset pricing – in order to reduce the 

risk from extreme weather and maintain 

affordable insurance rates. Speaking 

at the first-ever Insuring Resilient and 

Sustainable Cities Summit at Resilient 

Cities 2017, Oslo noted that after a period 

of trust building, the municipality and 

CITIES 

107

CITIES 

insurance partners found a way to share 

information for their mutual benefit. When 

local officials are better informed of their 

risk, they can take preventative measures 

that reduce damage and the need for 

insurance payouts. 

As risk managers, risk carriers 

and major institutional investors, the 

insurance sector is a natural partner to 

help cities assess and avoid risks, and 

invest in resilient infrastructure. Yet, as the 

previous example shows, even here work 

is needed to build effective public-private 

partnerships. ICLEI has teamed up with 

UNEP Principles of Sustainable Insurance 

initiative (UNEP PSI) in the largest 

collaboration between the insurance 

industry and cities to drive a long-term 

global action agenda. Our goals for 2018, 

captured in the ‘Bonn Ambition’, are to 

create ‘insurance development goals 

for cities’, develop city-level sustainable 

insurance roadmaps, and organise 

dialogues between insurance industry 

CEOs and mayors, including at the 2018 

ICLEI World Congress. Early endorsers of 

the Bonn Ambition include Munich Re, 

the G7 Climate Risk Insurance Initiative 

(InsuResilience), Patricia Espinosa 

(UNFCCC) and the Mayors of Bonn, 

Germany; Iloilo City, Philippines; and 

Honiara City, Solomon Islands. 

Defining the real costs and long-term 

benefits of climate resilience is important 

to foster public-private partnerships. 

According to Swiss Re, global economic 

Mayors meet to discuss the local implementation of the Paris Agreement and 2030 

Sustainable Development Agenda during Resilient Cities 2017 in Bonn, Germany 

losses from disasters in 2016 totalled 

US$175 billion. Cities with resilient urban 

infrastructure systems and services 

suffer less damage and fewer interrupted 

business days from natural disasters. 

Low carbon and resilient solutions like 

green buildings deliver efficiency gains 

while contributing to long-term adaptive 

capacity. This may be why Puerto Rico 

is interested to ‘build back better’ after 

Hurricane Maria with renewable energy 

that reduces vulnerability to power outages. 

Considering that 60 per cent of urban areas 

in 2030 have yet to be built, there is a huge 

opportunity for all cities to choose similar 

resilient development pathways. 

Resilience gains are not all about 

avoided costs. Adaptation projects also 

generate direct and indirect revenue. 

Copyright: ICLEI 2017 

From the sample of adaptation actions 

mentioned previously, the number 

one co-benefit was ‘improved urban 

livelihoods’. Fifth was job and business 

creation, followed by energy security 

and supporting a green urban economy. 

Increased property values and supply 

chain security were also reported. 

The UNFCCC COP23 under the Fiji 

Presidency, hosted in Bonn’s Rheinaue 

park – a beautiful example of ecosystembased 

adaptation with far-reaching socioeconomic 

benefits – is the perfect venue 

to discuss resilient, low carbon solutions. 

ICLEI is engaged in a full programme 

showcasing climate action by cities, regions 

and small island states that contribute to 

nationally determined contributions and the 

global ambitions of the Paris Agreement. 

ICLEI AT COP 23 

Summit | Dialogues | Pavilion 

ICLEI is organising the Climate 

Summit of Local and Regional 

Leaders. The City of Bonn and 

the State of North Rhine- 

Westphalia are co-hosts. 

We invite you to join us at the 

Cities & Regions Pavilion and 

look forward to partnering with 

leaders from all sectors toward 

the realisation of a low carbon, 

climate resilient urban future. 

Follow the action at 

citiesandregions.org 

108

DELIVERING 

CITIES 

CONCRETE 

CLIMATE 

ACTION IN 

CITIES 

Bosco Verticale in the Porta Nuova district of Milan, Italy 

109

CITIES 

Mark Watts, 

Executive Director of C40 Cities 

Shanghai skyline 

The shift towards a zero carbon 

economy is now irreversible and 

the lives of all the people on our 

wonderful planet are going to be improved 

as a result. That’s not to take progress for 

granted – we are very definitely at the 

mission-critical stage of needing to ramp 

up action to prevent run-away climate 

change. Global emissions really do need 

to peak by 2020, and we are nowhere near 

on track right now. The fact that the federal 

government in the United States is not 

going to be with us for the next three years 

is undoubtedly a huge setback. But I am 

confident we are going to get there, not least 

because non-state actors have stepped 

up to take leadership, and in particular the 

mayors of the big cities that C40 represents. 

At the C40 Mayors Summit in Mexico City 

in December 2016 we launched Deadline 

2020, the first significant route map for 

achieving the Paris Agreement, outlining 

the pace, scale and prioritisation of action 

needed by C40 member cities over the 

We need to ‘bend the curve’ of 

the emissions graph so that instead of 

an anticipated 35 per cent increase, 

emissions peak in 2020 and then start 

to fall sharply. 

next five years and beyond. A key finding 

of the report is that while achieving the 

ambition of the Paris Agreement to limit 

global temperature rise to below 1.5˚C will be 

incredibly tough, it is still technically possible. 

But by the end of 2020 each of the 91 cities in 

the C40 network will have in place a climate 

action plan that is consistent with limiting 

the global temperature rise to stay below the 

1.5˚C threshold. If all cities globally followed 

this example, then they could deliver 40 per 

cent of the emissions savings needed to 

achieve the Paris Agreement goals. 

Importantly, Deadline 2020 shows that the 

remaining global carbon budget – the total 

amount of emissions humans can risk putting 

in the atmosphere and still keep global 

temperature rise below 1.5˚C – is about 400 

gigatonnes for the rest of the 21st century. Of 

this, C40 cities are allocated 22 gigatonnes. 

At present, C40 cities emit 2.4 gigatonnes 

per year, so if they carried on at that rate the 

whole budget will be used up in less than 

a decade and by 2060, C40’s 91 cities alone 

will have used up the entire world’s carbon 

budget for the rest of this century. 

110

Mayors are currently 

much better placed to 

deliver collective global 

climate action than any 

other set of political leaders. 

CITIES 

If C40 cities are really to lead on delivering 

the Paris Agreement then we need to see a 

surge in climate action in the next few years. 

We need to ‘bend the curve’ of the emissions 

graph so that instead of an anticipated 35 

per cent increase, emissions peak in 2020 

and then start to fall sharply. 

Every single city needs to take radical 

action to move to a new low-carbon 

development path, with wealthier cities 

taking 70 per cent of actions between now 

and 2020; and lower income cities rapidly 

shifting to a low carbon development 

model so standards of living increase while 

emissions go down. There is no time to 

waste; indeed, in our model, 90 per cent of 

all the action C40 cities need to take to put 

the world on a climate-safe path needs to 

have happened by 2030. 

Deadline 2020 outlines what will need to 

have happened in cities in order to achieve 

these ambitious emissions reductions: 

• By 2020, nearly all C40 cities will have 

started building smart grids and energy 

storage, drastically reducing energy 

wastage. 

• By 2025, 75 per cent of buses in C40 

cities will be electric or other zero 

carbon, and every part of the city will be 

supported by mass transit, so we shall all 

be breathing cleaner air, enjoying quieter 

roads, and finding it easier to get around. 

• All new development will be transitoriented 

by 2030 and no mayor will be 

giving planning permission for new, 

sprawling suburbs that can only be 

accessed by car. 

• At the same time, waste pricing 

mechanisms will discourage the throwaway 

society. 

This sounds like a huge transformation 

– and it is. But delivering on the Paris 

Agreement is in every city’s self-interest. 

We already know from the work of the 

New Climate Economy that getting onto 

a low carbon development pathway will 

improve living standards faster and embed 

stronger and more sustained economic 

growth than the high carbon alternative. 

City leadership on climate change is 

essential, not least because the pledges 

made by presidents and prime ministers 

thus far would put the world on a 

path to between 2.5 and 3 degrees of 

warming, even without President Trump 

reneging on the US’s commitments. 

That figure is well within the zone that 

would spell disaster for large parts 

of the world and many of the world’s 

largest cities. 

Even as mayors, governors and 

business leaders are prepared to forge 

ahead, national commitments need to 

become more ambitious: if all are united 

on this issue we can make change that will 

resonate for generations. 

The leadership of cities and mayors is 

critical and it’s the mayors in office right 

now who hold in their hands the power to 

put the world on a low carbon path. Mayors 

are currently much better placed to deliver 

collective global climate action than any 

other set of political leaders. They are already 

convinced that we will build a much better 

world if we can constrain global temperature 

rise to below 1.5˚C – and they are acting 

upon it. 

111

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