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The World Bank and Climate Change
Available in: Spanish, Arabic, French 
Official Bank SitesRelated Information
November 13, 2006?The Investment Framework for Clean Energy and Development is the World Bank's assessment of what it would take to meet the vast energy needs of developing countries without significantly adding to global greenhouse gases.
The framework, developed at the request of G7 countries meeting in Gleneagles, Scotland, in 2005, also looks at ways to move to a lower carbon economy and reduce vulnerability to climate change, ?especially for the poor, who suffer most from this problem,? says Katherine Sierra, the World Bank?s vice president for sustainable development.
The challenges are great: 1.6 billion people still lack access to electricity today, especially in Africa and South Asia. The Bank estimates developing countries need an annual investment for electricity supply of US$165 billion through 2010, and an additional 3 percent per year after that through 2030. But only about half of that amount ? $80 billion?is readily identifiable.
With current policies and investments, 1.4 billion people still will not have access to modern forms of energy services by 2030, Sierra says.
And developing countries are expected to follow in the footsteps of industrialized nations and produce large amounts of CO2 as they develop unless new technologies are available to reduce greenhouse gas emissions.
The framework estimates that moving towards a global lower carbon economy will require an incremental global annual cost of several tens of billions of dollars per year ? less than $10 billion to more than $100 billion per year, depending on the greenhouse gas stabilization target, the pathway to stabilization, and the underlying development pathway of a country.
But the cost of decreasing greenhouse gas emissions can be reduced through international carbon trading, says Sierra.
The Bank has been actively working toward a low-carbon economy by developing the carbon market, in which industrialized nations help lower global CO2 emissions by buying ?credits? from projects that reduce CO2 in developing countries such as China, Serbia, Nepal, Timor-Leste, and Mexico. The Investment Framework says developing nations could see investments of tens of billions of dollars a year, provided the global carbon market is not hampered by uncertainty over its future, which is slated under the Kyoto Protocol, a United Nations agreement, to end in 2012.
In addition, existing instruments should be scaled up to develop markets that would help to promote energy efficiency and renewable energy technologies.
Severe weather patterns and climate change ?represent a major threat to poverty alleviation,? Sierra says. ?The economic impacts will be significant, especially in developing countries.?
According to a recent Bank report on adaptation to climate change, the impacts on investments, through increased costs or significant redirection, are estimated at 1 to 2 percent of the investment portfolio, or about $200 million to $400 million per year within the World Bank Group, and at least $1 billion for all official development assistance and concessional lending.
For that reason, climate risks need to be integrated within national planning processes and international finance, according to the framework.
International financial institutions should also play a major role in development of guidelines to enable screening of projects for climate benefits and risks, says Sierra.
http://web.worldbank.org/WBSITE/EXTERNAL/NEWS/0,,contentMDK:21125508~pagePK:34370~piPK:34424~the SitePK:4607,00.html
Available in: Spanish, Arabic, French
Official Bank SitesRelated Information
- Story | Video: Real & Windows
- UNs Framework Convention on Climate Change
- An Investment Framework for Clean Energy Development: A Progress Report | Speech | Nairobi Statement
- IFC Promotes Climate-Friendly Investments
- Wolfowitz: Response to the Stern Review
- Stern Review: Economics of Climate Change
November 13, 2006?The Investment Framework for Clean Energy and Development is the World Bank's assessment of what it would take to meet the vast energy needs of developing countries without significantly adding to global greenhouse gases.
The framework, developed at the request of G7 countries meeting in Gleneagles, Scotland, in 2005, also looks at ways to move to a lower carbon economy and reduce vulnerability to climate change, ?especially for the poor, who suffer most from this problem,? says Katherine Sierra, the World Bank?s vice president for sustainable development.
The challenges are great: 1.6 billion people still lack access to electricity today, especially in Africa and South Asia. The Bank estimates developing countries need an annual investment for electricity supply of US$165 billion through 2010, and an additional 3 percent per year after that through 2030. But only about half of that amount ? $80 billion?is readily identifiable.
With current policies and investments, 1.4 billion people still will not have access to modern forms of energy services by 2030, Sierra says.
And developing countries are expected to follow in the footsteps of industrialized nations and produce large amounts of CO2 as they develop unless new technologies are available to reduce greenhouse gas emissions.
The framework estimates that moving towards a global lower carbon economy will require an incremental global annual cost of several tens of billions of dollars per year ? less than $10 billion to more than $100 billion per year, depending on the greenhouse gas stabilization target, the pathway to stabilization, and the underlying development pathway of a country.
But the cost of decreasing greenhouse gas emissions can be reduced through international carbon trading, says Sierra.
The Bank has been actively working toward a low-carbon economy by developing the carbon market, in which industrialized nations help lower global CO2 emissions by buying ?credits? from projects that reduce CO2 in developing countries such as China, Serbia, Nepal, Timor-Leste, and Mexico. The Investment Framework says developing nations could see investments of tens of billions of dollars a year, provided the global carbon market is not hampered by uncertainty over its future, which is slated under the Kyoto Protocol, a United Nations agreement, to end in 2012.
In addition, existing instruments should be scaled up to develop markets that would help to promote energy efficiency and renewable energy technologies.
Severe weather patterns and climate change ?represent a major threat to poverty alleviation,? Sierra says. ?The economic impacts will be significant, especially in developing countries.?
According to a recent Bank report on adaptation to climate change, the impacts on investments, through increased costs or significant redirection, are estimated at 1 to 2 percent of the investment portfolio, or about $200 million to $400 million per year within the World Bank Group, and at least $1 billion for all official development assistance and concessional lending.
For that reason, climate risks need to be integrated within national planning processes and international finance, according to the framework.
International financial institutions should also play a major role in development of guidelines to enable screening of projects for climate benefits and risks, says Sierra.
http://web.worldbank.org/WBSITE/EXTERNAL/NEWS/0,,contentMDK:21125508~pagePK:34370~piPK:34424~the SitePK:4607,00.html
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