29 C
Lagos
Sunday, May 25, 2025
Home Blog Page 1858

Bigwig firms seek to put a price on carbon

0

New insights on carbon prices to transform the power sector were launched on Thursday, May 25, 2017 by the world’s first industry-led initiative convened by business leaders from Bank of America, Barclays, PGGM, MN, Engie, Iberdrola, NRGand Hermes Investment Management. The power sector accounts for a quarter of global emissions and defining investment-grade carbon price ranges will help companies better understand risks and how these align with the goals set out in the Paris Agreement.

Nicolette Bartlett
Nicolette Bartlett, CDP’s Director of Carbon Pricing

The report reveals that while policies which place an explicit price on carbon are increasing globally, with a 23% increase between 2015-2016 in companies embedding an internal carbon price, they are not incentivising companies enough to undergo the rapid transformation needed to achieve abelow 2°C scenario. The research also shows there are other carbon-related price signals embedded in the economy which need to be considered, including policy, innovation and shifting market dynamics.

“The power sector is at the heart of the shift to a low-carbon future. Power generation needs a complete overhaul, with 100% decarbonisation needed globally by 2050 to have a better chance of keeping to 2 degrees,” commented Nicolette Bartlett, CDP’s Director of Carbon Pricing. “By factoring in carbon prices necessary for this transformation, utilities and investors can better assess climate-related risks as well as identify commercially attractive carbon-free alternatives.”

The Carbon Pricing Corridors is part of the work conducted by CDP under the We Mean Business initiative comprising a panel of more than 20 chief executives and senior leaders from across the G20 who provide market insights into the future impact of carbon pricing. Investors, companies and policymakers can use the price ranges to help calculate the risks and opportunities posed by climate risk to investment decisions. The power sector currently uses an average carbon price of $35/tonne. The panel identified that utilities would need a carbon price range between $30 – $100/tonne by 2030 to limit global warming to 2°C.

The price ranges could be particularly useful for those companies and investors who plan to align their business models with the goals outlined in the Paris Agreement using an internal carbon price. Findings suggest that carbon prices emerging by 2030 will impact capital expenditure decisions being made by power companies today.

This report comes at a critical moment as Mark Carney’s Taskforce on Climate-related Financial Disclosure (TCFD) highlights a clear need for investors to be able to stress test their portfolios against a range of scenarios. The Carbon Pricing Corridors initiative provides organisations with a ready-made tool to stress test their investment decisions in light of the Paris Agreement.

There is increasing momentum for carbon pricing in both public and private spheres, as renowned economists Joseph Stiglitz and Lord Nicholas Stern have established a high-level commission on carbon pricing for policymakers.

Lance Pierce, President of CDP North America, commented: “Industry-led endorsement of this initiative underscores the spread of carbon pricing as a tool for both business and policy. The price ranges identified by the Corridors initiative can help investors and companies with the increasingly important task of calculating the transitional risks brought on by climate change. TCFD recommendations point to the clear need for investors to be able to stress test their portfolios against a below 2°C scenario, and many are seeing robust carbon pricing as an important way to operationalise the TCFD recommendations. Preparing for a price on carbon today will help transform the wider economy tomorrow, decreasing climate-related risk more broadly and supporting financial stability.”

“Our focus on the Task Force is on how companies can and should integrate climate-related risks and opportunities into their core financial planning and reporting. We recommend companies sense check their business strategy against a range of scenarios, including taking into account that over 200 countries agreed to the ambitious goal of stabilizing the climate below 2-degrees. There is a very real transition underway, in particular across the energy sector. The private sector needs to take this into account if we are allocate capital to the right places and ensure financial stability,” commented Mark Lewis, Managing Director, Head of European Utilities Equity Research, Barclays; Member of the Task Force on Climate-related Financial Disclosure.

Other findings include:

  • Public policy: Policymakers can use these findings in their cost-benefit analyses of policy proposals and in public procurement decisions.
  • User friendly: The initiative has developed a ‘user matrix’ detailing how different sectors can use the price ranges over different time periods, to benchmark their investment decisions against these price signals.
  • Price ranges: Price ranges for the period to 2030 do not differ significantly from those created by institutions such as the IEA and Carbon Tracker. However, there are variations nearing 2030, when some panel members believe a lower price than other models will be needed due to technology break-throughs and favorable renewable cost curves.

The initiative is due to report on its initial carbon price ranges in other energy-intensive sectors over the next two years, including steel, cement, paper & pulp and aluminum.

How to unlock private investment for climate action

0

In 2016, the historic Paris Climate Change Agreement accelerated already growing markets for climate-smart investment. And 2015 was another record-breaking year for renewable energy, with nearly $350 billion invested, more than double the amount going to fossil-powered generation.

Tom Kerr
Tom Kerr, Principal Climate Policy Officer, International Finance Corporation

The growing attraction of climate business was evident at last year’s UN Climate Change Conference in Marrakesh, where more and more major businesses spoke about climate as an investment opportunity that they were looking to pursue. But where are the most promising investments? And what do governments need to do to unlock private finance between now and 2030?

To answer these questions, the International Finance Corporation (IFC) – a member of the World Bank Group and the largest global development institution focused on the private sector in developing countries – analysed the national climate action plans (Nationally Determined Contributions, or “NDCs”) made by 21 rapidly growing emerging market economies where we expect to see major investment in infrastructure and climate-smart solutions.

If these countries make good on their ambitions to scale up solar and wind energy, increase green buildings, put in place cleaner transport, and implement waste solutions – there is a $23 trillion investment potential to 2030. Several sectors show great promise:

Renewable energy markets are set to accelerate. A total of 138 countries have prioritised the sector in in their climate plans. Profitable investment opportunities are expected to be on the rise in rapidly growing economies such as Panama, where IFC is helping to finance the Penonome wind farm, a 215-megawatt plant that will be Central America’s biggest. As governments move to implement their renewable energy targets in a post-Paris world, we can expect many more Penonome-type investments.

Energy efficiency is also a growing opportunity, with 110 countries targeting investments in cogeneration, efficient appliances, and green buildings in their Paris commitments. One example of an energy-efficiency investment that we can expect to see more of is IFC’s China Utility Energy Efficiency programme, which provides Chinese banks with a risk-sharing facility and advisory services to help them implement energy efficiency investments. The program started in 2006 with two Chinese banks and has grown to drive 11 billion Chinese yuan ($2 billion) in finance through local banks. And as Chinese citizens increasingly move to cities, we see $2.1 trillion in new green buildings investment by 2020.

The outlook for investment in climate solutions by private enterprise is strong. Unlocking this potential requires sustained action by governments to put in place the right set of policies and measures. We see three key priorities for countries seeking to attract private investment.

First, turn climate targets into long-term clean growth strategies, with supportive policies and budgets. This means integrating commitments into national development strategies and putting in place clear and consistent policies such as carbon pricing. Governments can ease the path for private sector investment by integrating climate considerations into key sector policies such as energy and agriculture by removing inefficient production or consumption subsidies and aligning tax and fiscal policies.

Countries can also use innovative support mechanisms like reverse auctions and competitive procurements. And we stand ready to help. One example is the World Bank Group’s Scaling Solar programme that provides governments with a template for procuring large-scale solar photovoltaic power through competitive auctions. Private sector energy developers can have confidence in a predictable set of specifications and legal documents, even in new markets. Standardisation brings speed and efficiency. Dozens of leading energy companies participated in the programme’s first competitive auction in Zambia, which yielded the lowest price so far for solar power in Africa.

Second, countries need to put in place strong enabling environments for private investment, by strengthening competition and promoting investment and capital flows. Effective and transparent business taxation, regulation, legal enforcement of property rights, frameworks for public-private partnerships, and proactive investment policies all help to build investor confidence.

In Jordan for example, the government is transforming its energy sector by complementing its renewable energy law with feed-in tariffs, 20-year power purchase agreements with standardised contracts, and a 10-year income tax holiday with a lower tax rate. The government also provided a sovereign guarantee to back-stop the buyer’s payment obligations. This mix of policies, processes, and incentives resulted in the largest private sector-led solar initiative in the region – the 117 MW, $290 million Tafila Wind Farm, supported by an IFC investment of $69 million – that is being followed by 12 solar projects with power purchase agreements totaling 190 MW.

Third, use limited public finance in a catalytic way. During the challenging project preparation period, public finance can help identify investment opportunities and generate a project pipeline. This is where IFC can help. A “blended finance” approach has allowed IFC to blend small amounts of public concessional funds with private sector commercial funds to finance first-of-a-kind projects that have a high development impact and a strong potential to create a demonstration effect, but have not yet established a commercial track record. Many of these investments have been successful in catalysing market growth. Some of the noteworthy examples include the $4 million in concessional finance that helped bring some of Thailand’s first solar PV farms online in 2011. And in Mexico, $15 million in concessional financing helped one of the first privately financed wind farms in the country reach the finish line, demonstrating market feasibility to investors.

The $23 trillion climate investment opportunity will not happen overnight. It will require cooperation among government, business, and development finance institutions. By conducting focused dialogues around key NDC targets, we can systematically identify key barriers to private investment and develop solutions. But by working together, country by country, we can work to keep global warming under two degrees Celsius while also creating profitable new markets, employment opportunities, and increased resilience to climate change.

Tom Kerr, Principal Climate Policy Officer, International Finance Corporation

How Ghebreyesus emerged new WHO boss

0

Dr Tedros Adhanom Ghebreyesus, who Member States of the World Health Organisation (WHO) elected on Tuesday, May 23, 2017 as the new Director-General of the UN body, overcame opposition from two other contestants.

Dr Tedros Adhanom Ghebreyesus
Dr Tedros Adhanom Ghebreyesus, Director General of the WHO. Photo credit: FABRICE COFFRINI/AFP/Getty Images

Dr Ghebreyesus, who was nominated by the Government of Ethiopia, contested with two other niminees for the position: Dr David Nabarro of the United Kingdom of Great Britain and Northern Ireland, and Dr Sania Nishtar of Pakistan.

At the World Health Assembly holding in Geneva, Switzerland, each of the nominees on Tuesday addressed the Health Assembly for 15 minutes. Dr Ghebreyesus spoke first, followed by Dr Nabarro and then by Dr Nishtar. The election thereafter took place by secret ballot and the result was communicated upon the completion of the process.

Dr Ghebreyesus will begin his five-year term on July 1, 2017.

Prior to his election as WHO’s next Director-General, Dr Ghebreyesus served as Minister of Foreign Affairs, Ethiopia from 2012–2016 and as Minister of Health, Ethiopia from 2005–2012. He has also served as chair of the Board of the Global Fund to Fight AIDS, Tuberculosis and Malaria; as chair of the Roll Back Malaria (RBM) Partnership Board; and as co-chair of the Board of the Partnership for Maternal, Newborn and Child Health.

As Minister of Health, Ethiopia, Dr Tedros Adhanom Ghebreyesus led a comprehensive reform effort of the country’s health system, including the expansion of the country’s health infrastructure, creating 3500 health centres and 16 000 health posts; expanded the health workforce by 38 000 health extension workers; and initiated financing mechanisms to expand health insurance coverage. As Minister of Foreign Affairs, he led the effort to negotiate the Addis Ababa Action Agenda, in which 193 countries committed to the financing necessary to achieve the Sustainable Development Goals.

As Chair of the Global Fund and of RBM, Dr Tedros Adhanom Ghebreyesus secured record funding for the two organizations and created the Global Malaria Action Plan, which expanded RBM’s reach beyond Africa to Asia and Latin America.

Dr Tedros Adhanom Ghebreyesus will succeed Dr Margaret Chan, who has been WHO’s Director-General since January 1, 2007.

Croatia emerges 147th Party to Paris Agreement

0

Two months after the country’s Parliament endorsed the ratification of the Paris Agreement in April, Croatia on Wednesday, May 24, 2017 deposited its instrument of ratification for the global treaty on climate change.

Kolinda Grabar-Kitarović
Kolinda Grabar-Kitarović, President of Croatia

The European nation has thus become the 147th Party to the Agreement, closely following Nigeria (146th Party), which also recently ratified the climate pact.

However, Croatia’s ratification will come into force on Friday, June 23, 2017, according to the United Nations Framework Convention on Climate Change (UNFCCC).

The Croatian Parliament on Friday, April 17, 2017 unanimously ratified the Paris Agreement, which the country signed in April last year. The voting was preceded by a debate.

The Paris Agreement was adopted on December 12, 2015 at the 21st session of the Conference of the Parties (COP21) to the UNFCCC held in Paris, France from November 30 to December 13, 2015.

On October 5, 2016, the threshold for entry into force of the Paris Agreement was achieved. The Paris Agreement entered into force on November 4, 2016. The first session of the Conference of the Parties serving as the Meeting of the Parties to the Paris Agreement (CMA 1) took place in Marrakech, Morocco in November, 2016.

The Paris Agreement builds upon the Convention and – for the first time – brings all nations into a common cause to undertake ambitious efforts to combat climate change and adapt to its effects, with enhanced support to assist developing countries to do so. As such, it charts a new course in the global climate effort.

The Paris Agreement’s central aim is to strengthen the global response to the threat of climate change by keeping a global temperature rise this century well below 2 degrees Celsius above pre-industrial levels and to pursue efforts to limit the temperature increase even further to 1.5 degrees Celsius. Additionally, the agreement aims to strengthen the ability of countries to deal with the impacts of climate change.

Pogba dedicates Europa trophy to Manchester victims

0

World’s most expensive player, Paul Pogba, has dedicated the Europa victory over Ajax to victims of Monday’s attack in the city of Manchester, England.

Paul Pogba
Paul Pogba celebrates with the Europa League trophy

Pogba, who starred for Manchester United, scored one of the two goals that ensured that the British team triumphed over the Dutch side in Stockholm, Sweden on Wednesday, May 24, 2017.

He said that his goal and his team’s victory were for the 22 people who were killed by a suicide bomber, following a concert at the Manchester Arena.

Pogba and Henrikh Mikhitaryan scored in each half to earn a United victory on Wednesday. Pogba, who returned to Old Trafford from Juventus last summer for a world record fee of £89 million, saw his shot from the edge of the box deflected in off Davidson Sanchez in the 18th minute.

Club mate midfielder, Mikhitaryan, flicked the ball in from close range for his sixth goal in the Europa League this season, three minutes after the break.

United’s victory in Stockholm means the club has now won all three of Europe’s major competitions, having previously won the Champions League three times (in 1968,1999 and 2008) and the Cup Winners Cup in 1991.

The Europa League is the second major trophy of José Mourinho’s debut season in charge, having also won the League Cup in February.

By Felix Simire

Images: Government, environment CSOs interact

0

The Federal Government on Thursday, May 25, 2017 in Abuja had an interactive session with civil society organisations operating in the environment and development sector.

At the daylong event, Environment Minister of State, Ibrahim Usman Jibril, assured the campaigners of government’s continued partnership with them towards the realisation of a safe and sustainable environment.

Usman-Jibril
The Minister of State giving a keynote address
Goni Ahmed
Mr Goni Ahmed, DG/CEO, National Agency for the Great Green Wall in Nigeria, speaking on government’s efforts to improve the Green Great Wall Programme and engagement with CSOs
Andrew Ilo
Dr Andrew Ilo commenting on the need to link the Nationally Determined Contributions (NDCs) to the recently launched Economic Recovery and Growth Plan (ERGP)
Centre LSD
A representative of African Centre for Leadership, Strategy & Development commenting of the Niger Delta cleanup and need for sensitisation
NACGOND
A participant representing the NACGOND also commenting on the Niger Delta cleanup process and need for sensitisation
Hamzat Lawal
Mr Hamzat Lawal of Connected Development speaking on the need to follow up on saving Shikira and improve transparency
Chike Chikwendu
Chike Chikwendu of Friends of the Environment giving an opening remark and expectations of the forum
Ibrahim-Usman-Jibril
The Environment Minister of State responding to questions and comments from the participants

 

TV Report: The GMO controversy

1

Campaigners against the adoption of genetically modified organisms (GMOs) in Nigeria have taken their demands to the Minister of State, Environment, Ibrahim Usman Jibril. The groups are demanding increased funding to research institutions to encourage home-grown technology to boost the country’s food security.

The Minister assured the group of government’s commitment to upholding standards on scientific findings while appreciating concerns raised over the safety of the GMO technology, which began about 37 years ago, compelling groups in Nigeria to continue to demand accountability from the government.

Salamatu Ibrahim reports….

TV Report: Reversing the Biosafety Law

1

The Health of Mother Earth Foundation (HOMEF) has challenged the Federal Government to revoke the licence issued to Monsanto Nigeria, if indeed it is committed to protecting the food sovereignty of the citizens.

The Foundation wants an urgent repeal of the National Biosafety Management Act, which it claims fails to protect the consumers of food containing genetically modified organisms (GMOs), but protects corporations like Monsanto.

Salamatu Ibrahim reports….

Nations restate commitment to Paris Agreement

0

The eighth Petersberg Climate Dialogue concluded on Tuesday, May 23, 2017 with a clear commitment to the Paris Agreement and to its ambitious implementation.

Angela Merkel
German Chancellor Angela Merkel (L) delivers her speech on May 23, 2017 in Berlin at the Petersberg Climate VIII Dialogue event. Photo credit: AFP PHOTO / POOL / Kay Nietfeld

The key topic at this year’s meeting was the preparation for the Climate Conference COP23, to take place in November in Bonn under the Presidency of Fiji.

Ministers from regions around the world responded to the joint invitation from Federal Environment Minister Barbara Hendricks and the Prime Minister of Fiji, Josaia Voreqe Bainimarama.

Prime Minister Bainimarama said: “Only by the entire world coming together as one to address the impacts of climate change can we effectively tackle this crisis. Climate change affects every person on earth and especially those in vulnerable countries like Fiji. I am convinced that when we act in the interest of the most vulnerable, we are acting in the interests of us all – because we are all vulnerable and we all need to act.”

Federal Environment Minister Hendricks said: “The Petersberg Climate Dialogue has shown strong multilateral solidarity on the issue of climate action. The world is standing together and bringing the Paris Agreement to life. More and more countries understand that climate action modernises economies. Ambitious, well-made climate policy does not put the brakes on growth – it fuels growth.”

The OECD report “Investing in Climate, Investing in Growth”, which was drawn up as a part of the German G20 Presidency, was a topic of discussion at the Petersberg Climate Dialogue. Another focus of the talks was the preparation for the Climate Conference COP23, which will address the rulebook on the detailed implementation of the Paris Agreement.

In addition, preparation for the 2018 Facilitative Dialogue was discussed. This dialogue will assess in detail the progress the international community has made so far in climate action.

Germany is supporting Fiji as technical host of COP23. In cooperation with the UNFCCC-Secretariat, Fiji and Germany have created a plan for a conference that will give space to climate diplomats as well as non-state actors. According to the principle “one conference, two zones”, there will be the “Bula Zone” for negotiations and the “Bonn Zone” devoted to climate initiatives and projects.

Prime Minister Bainimarama remarked: “In Bonn, I will be dividing my time between what we are calling the Bula Zone – the formal negotiations – and the Bonn Zone – which is where much of the action will be. My goal is to also encourage the non-state actors to further initiatives that connect the global and the local.”

Minister Hendricks commented: “Fiji is the first Small Island Developing State to take on the Presidency of a Climate Conference. We are happy and thankful that Fiji will be actively pushing forward the implementation of the Paris Agreement and we are pleased to assist Fiji in carrying out the conference. In Paris, the international community concluded an agreement. Now we want to network societies more closely. Climate action will ultimately only succeed if as many stakeholders as possible do their part.”

The German government has been organising the Petersberg Climate Dialogue since 2010, when it was held on the Petersberg near Bonn. This meeting has now established itself as an important event for international climate diplomacy. It is held in an informal setting to foster open debate. The co-chair at the Climate Dialogue is the country presiding over the next Climate Change Conference.

G7 must steer capital towards global climate action, says Espinosa

0

In an article published recently in “Climate Change – The New Economy”, Patricia Espinosa, Executive Secretary of the UN Framework Convention on Climate Change (UNFCCC) and the UN’s top climate change official, calls on G7 leaders to heavily invest in ventures aimed at tackling the climate change scourge

Patricia-Espinosa
Patricia Espinosa, executive secretary of the UN Framework Convention on Climate Change (UNFCCC)

Less than two years following the adoption of the Paris Climate Change Agreement, nations are now getting down to the challenging task of implementing their pledges and getting on track to a low-carbon, resilient world. The G7 countries, as the club of the richest industrialised nations, can play a key role in raising ever higher ambition and action that in turn can benefit their national economies and the rest of the globe.

There is real cause for optimism starting with the status of the Paris Agreement itself. The treaty came into force less than one year after it was born and to date well over 140 nations, including all the members of the G7, have ratified it.

Several countries, including members of the G7, have also announced long-term climate plans that reflect the long-term goal of the Agreement – namely to achieve climate neutrality in the second half of the century as a key to keeping a global temperature rise this century well below 2 degrees C.

Meanwhile, subnational governments are also setting ambitious targets and implementing game-changing initiatives. At the last annual UN climate conference in Marrakech, a club of subnational governments, the Under2 Coalition, who have committed to reducing their emissions by at least 80 per cent by 2050, announced their membership had grown to 165.

The combined GDP of these 165 members is close to $26 trillion – a third of the global economy – and covers a population of around one billion people living in North America, Europe, Latin America, Africa and Asia.

According to We Mean Business, the number of companies making climate commitments has also more than doubled since Paris 2015. And the companies acting are now worth $8 trillion in market capitalisation.

Nearly 500 investors with over $25 trillion in total assets under management, including pension funds and high net worth individuals, have pledged to decarbonise their portfolios.

New market instruments are also emerging such as Green Bonds, which in 2016 saw a record issuance of over $80 billion and are up over 40 per cent in the first quarter of 2017 versus the same period last year.

A diverse range of private and government organisations have issued green bonds, from Apple and Toyota to the French government and New York’s Metropolitan Transportation Authority. These developments are being underpinned by a growing wealth of policy-making that promises to embed the transition to a low-carbon, resilient and sustainable world.

In early May, the Grantham Institute at the London School of Economic provided an update on Global Trends in Climate Legislation.

It shows that today there are now over 1,200 climate change or climate change-relevant laws in place world-wide: a 20-fold increase over 20 years when compared with 1997, when there were just 60 such laws in place.

So the world is moving to implement the Paris Agreement and the linked Sustainable Development Goals which are the foundation of the 2030 Agenda. In 2016, global energy-related carbon dioxide emissions were flat for a third straight year even as the global economy grew, according to the International Energy Agency.

But there can  be  no  room  for  complacency. The current pace  of  positive  change  is  still well behind the curve and unless ambition is significantly raised, and raised soon, we may lock in a highly hazardous temperature rise of 3, 4 or more degrees Celsius this century.

One fundamental area is reforming the global financial architecture so that more finance flows into sustainable investments. By some estimates, $90 trillion-worth of investment should be directed into what one may term green investments by 2030, covering everything from promoting more renewable energy and energy efficiency to sustainable transportation.

Currently, $300 trillion of assets are held by banks, the capital markets and institutional investors. So we are faced with a problem of allocation, rather than outright scarcity.

There are some promising developments. In all, the total number of policy and regulatory measures to build a more sustainable financial system has more than doubled in the past five years.

The UN Environment, in a recent report, says actions taken by finance ministries, central banks and regulators to promote sustainable finance have risen to 217 and now exist in nearly 60 countries.

These range from actions steering finance towards clean energy, assessments of climate risk for insurance companies and on to producing road maps that set out how to “green” an entire financial system as China did last year.

These are all promising signs of positive momentum, but the world’s financial architecture is still ill-equipped to deliver the necessary transformation.

The national climate plans submitted by governments represent a real improvement on business as usual, but do not yet provide the signals needed to steer capital towards global climate action.

So while it is true that investors are starting to measure the carbon footprint of portfolios and increase exposure to green assets, only a tiny minority has introduced comprehensive climate strategies.

The financial system clearly needs to evolve further to price environmental risks, overcome short-termism and deliver greater transparency on climate performance.

Making this happen, and take place with a sense of urgency, will require different players to put in place mutually reinforcing financial policies and regulations that support the Paris Agreement.

If we can get it right, private capital will respond – and the trillions needed for transformation across countries North and South will flow.

The G7 club of nations, working with, for example, the G20, have the human and political resources able to power up this change. It is time to deploy them.

×