Financing a Just Transition – Transforming Funding, Tackling Climate Change is a focused publication examining how finance can unlock a fair and effective global response to climate change. Released alongside COP29, it brings together leading voices from international organisations, academia and industry to explore how public and private capital can drive a more equitable transition. Through expert analysis and practical insights, the edition addresses key challenges such as funding mechanisms, transparency and cross-sector collaboration, while highlighting solutions ranging from regenerative agriculture to new approaches by multilateral development banks. It offers a clear, informed perspective for decision-makers working to accelerate climate action and deliver a sustainable future.
Financing a Just Transition Transforming Funding, Tackling Climate Change
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CONTENTS
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Financing a Just Transition Transforming Funding, Tackling Climate Change
INTRODUCTION: ACHIEVING ADEQUATE, AMBITIOUS CLIMATE FINANCE
1.1 Countering the greatest crisis of our time John Kirton, director, Global Governance Program p8 1.2 Bridging the gap between ambition and action Ella Kokotsis, director of climate finance strategy, Global Governance Program p10 1.3 A moment of profound fracture Simon Stiell, executive secretary, UN Climate Change p12 1.4 A crucial transformation Narendra Modi, prime minister, India p14 1.5 Taking a global role in the climate crisis Luiz Inácio Lula da Silva, president, Brazil p18 1.6 Building a sustainable future Cyril Ramaphosa, president, South Africa p22
ADVOCACY How can the world save $50 trillion by 2050 in the green energy transition? Jennifer Steinmann, global sustainability business leader, Deloitte, and Bernhard Lorentz, global consulting sustainability and climate strategy leader, Deloitte p24 1.7 Mobilising UNDP support for climate finance Interview with Achim Steiner, administrator, United Nations Development Programme p26 1.8 Major climate finance initiatives since the Paris Agreement p28 1.9 Tracking climate contributions p30
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Financing a Just Transition is an official publication of the Global Governance Project. The Global Governance Project is a joint initiative between GT Media , a publishing company based in London, the Global Governance Program, based at the University of Toronto. The Global Governance Project provides a vital function for private and public sector organisations in support of their governance responsibilities. As a project it publishes content on how we can all demonstrate better collective governance, via independent platforms, for the world’s largest intergovernmental organisations, governments, NGOs, multilateral and bilateral summits, and the private sector’s leadership. © 2024. The entire contents of this publication are protected by copyright. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the publisher. The views and opinions expressed by independent authors and contributors in this publication are provided in the writers’ personal capacities and are their sole responsibility. Their publication does not imply that they represent the views or opinions of the Global Governance Program, the University of Toronto or GT Media Group and must neither be regarded as constituting advice on any matter whatsoever, nor be interpreted as such.
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Financing a Just Transition
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MOBILISING PRIVATE SECTOR FINANCE
THE PARIS AGREEMENT PLATFORM
IMPROVING PUBLIC FINANCE
2.1 Bridging the gap: using carbon pricing éäěãÖãØÚéÝÚÚãÚçÜî transition Ely Sandler, Harvard Kennedy School p34 2.2 The need to scale climate ěãÖãØÚåçäëÞèÞäã for a just transition: Morocco’s perspective Bouzekri Razi, director, Climate Change, Biodiversity and Green Economy, Morocco’s Ministry of Energy Transition and Sustainable Development, and Iskander
3.1 Working together éäěÜÝéØáÞâÖéÚ change Kristalina Georgieva, managing director, International Monetary Fund p44 3.2 The role of the International Monetary Fund in supporting climate action Ceyla Pazarbasioglu, Department, International Monetary Fund p46 ADVOCACY Electrify and decarbonise: GE Vernova’s blueprint for a just energy transition Scott Strazik, chief executive officer, GE Vernova p48 director, Strategy, Policy and Review
3.3 Lessons from a journey across the globe Ajay Banga, World Bank Group president p50 3.4 Trillions needed from the G7 and G20 for the climate emergency Brittaney Warren, director of compliance and sustainability governance, Global Governance Program p52 3.5 How multilateral development banks can bridge the ØáÞâÖéÚěãÖãØÞãÜ gap Frannie Léautier, former chair, G20 Expert Panel on the Capital Adequacy of the Multilateral Development Banks p54
4.1 Financial innovation for climate
investment and development Mark Carney, United Nations special envoy on climate action and finance p58 4.2 Transforming the ěãÖãØÞÖáèîèéÚâÖã inclusive, people- centred approach Nick Robins, professor in practice – sustainable finance, London School of Economics and Political Science p60 ADVOCACY Financing the transition: why we need leadership Lindy Fursman, director of climate and energy policy, Tony Blair Institute for Global Change p62 4.3 Are corporations allocating capital towards climate action? Shafaq Ashraf and Sangeeth Selvaraju, Grantham Research Institute on Climate Change and the Environment p64
Erzini Vernoit, director, IMAL
Initiative for Climate and Development p36 2.3 Rwanda’s path to a just and
sustainable future: âä×ÞáÞèÞãÜěãÖãØÚ for climate action Juliet Kabera, director general, Rwanda Environment Management Authority p38 2.4 Balancing development and climate ambitions Amitabh Kant, India’s G20 sherpa p40
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CONTENTS
5 6 7 FRONTIER TECHNOLOGY – FINANCING FIT- FOR-FUTURE INFRASTRUCTURE INNOVATIVE CLIMATE FINANCING
IMPROVING INTEGRITY FOR PRIVATE SECTOR FINANCE
5.1 How IOSCO is supporting trust in capital markets to drive sustainability Jean-Paul Servais, board chair, International Organization of Securities Commissions p68 5.2 Best steps now for urgent climate action Interview with Michael Bloomberg, UN secretary- general’s special envoy for climate ambition and solutions p70 ADVOCACY Minas Gerais A beacon for global investment p72 5.3 Partnerships to get on the right pathway Mia Mottley, prime minister, Barbados p74 5.4 Corruption: a roadblock éäØáÞâÖéÚěãÖãØÚ
6.1 Growing the pipeline of energy transition investments Astrid Manroth, head, Global Infrastructure Facility p80 6.2 What will it take to unlock climate ěãÖãØÚÛäçßêèéÚãÚçÜî transitions? Angela Wilkinson, secretary general and CEO, World Energy Congress p84 ADVOCACY Financing a just transition means mobilising the private sector Leen Alsebai, general manager, RX Middle East, and head, World Future Energy Summit p86 6.3 How regenerative agriculture can make climate solutions more resilient Tania Strauss, head of food
7.1 Addressing the climate ěãÖãØÚÜÖåÖåÖéÝ forward for global emissions alignment and ambitious action Paolo Gentiloni, European Commissioner for Economy p94 7.2 An SDR bond for climate ěãÖãØÚ Brad W Setser, Whitney Shepardson senior fellow, Council on Foreign Relations p96 7.3 A public health perspective on climate change and small island developing states: the Caribbean region Laura-Lee Boodram, Shane Kirton and Lisa Indar, Caribbean Public Health Agency p100 7.4 A closer look at South Africa’s approach Interview with Elizabeth Sidiropoulos, chief executive, South African Institute of International Affairs p104
Lida Preyma, founder and CEO, Cēlandaire Capital p76
and water, World Economic Forum p88
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Financing a Just Transition
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INTRODUCTION: ACHIEVING ADEQUATE, AMBITIOUS CLIMATE FINANCE
8 John Kirton
10 Ella Kokotsis
12 Simon Stiell
14 Narendra Modi
24 Jennifer Steinmann and Bernhard Lorentz ADVOCACY
18 Luiz Ignácio Lula da Silva
22 Cyril Ramaphosa
26 Achim Steiner
28 Major climate finance initatives
30 Tracking climate contributions
INTRODUCTION: ACHIEVING ADEQUATE, AMBITIOUS CLIMATE FINANCE
1.1
Countering the greatest crisis of our time
Time is running out if we are to constrain global temper- ature rises in line with the Paris Agreement. We urgently need to mobilise finance – from both public and private actors.
Reaching the limit There is no time to lose. The world’s lead- ers at the meeting of the Conferences of the Parties to the United Nations Frame- work Convention on Climate Change in Paris in 2015 agreed – based on the com- pelling science then – that our planet’s post-industrial temperature increase must be limited to 2°C and ideally 1.5°C. But we are already approaching those limits, and in places exceeding them, in ways that are often difficult or even impossible to reverse. The last 12 months have been the warmest on record. The greenhouse gas emissions that humans continue to produce to pollute the atmosphere relentlessly add to the historically high concentrations already there. Thus, at the COP29 meeting in Baku on 11–22 November this year, global leaders and stakeholders must take bold, broad actions to mobilise much more badly needed climate finance before it is too late. That is why COP29 host Azerbai- jan has made climate finance the top priority and asked countries to submit updated, stronger nationally deter- mined contributions specifying what they will do to contain a crisis that afflicts all. The finance gap The size of the climate finance chal- lenge is compellingly clear. Recent economic and political headwinds have caused the climate finance gap to widen in terms of volume, quality and the cost of capital. This includes the fund- ing shortfall for climate mitigation,
adaptation and clean infrastructure in the Global South, as well as the associ- ated capital costs – stemming from the gap between the high returns or interest rates demanded in emerging markets and the borrowers’ capacity to pay. To remain within the Paris Agree- ment’s warming targets, trillions of dollars are needed for carbon mitiga- tion, adaptation and resilience. Specific estimates of climate financing needs vary, but current levels are without doubt critically insufficient – and are rising as new, incoming data show global heating, extreme weather events and their resulting damage increase. The Independent High-Level Expert Group on Climate Finance estimates that emerging markets and developing countries (excluding China) need more than $1 trillion in climate finance each year by 2030, the majority of which is required for mitigation. The Interna- tional Energy Agency estimates that annual renewable energy investment in emerging and developing economies must increase by more than seven times – from less than $150 billion in 2020 to over $1 trillion by 2030 – to reach net- zero emissions by 2050. Many intergovernmental institutions have started to promise and provide new funds to help meet the need. The major global governance bodies – the UNFCCC COPs, the United Nations Development Programme, the International Mone- tary Fund, the World Bank, the G20 and the G7 – have done so. So have several national governments from the devel- oped world. Together they have begun
John Kirton, director, Global Governance Program
C limate change is by far the greatest crisis and challenge of our time. The unprece- dented heat and extreme weather events around the world this year are causing significant deaths and damage to people and other living things. They are certain to get worse. Countering this crisis requires mobi- lising vast amounts of climate finance for a just transition to a liveable planet for our shared future. It must be done by the public and private sectors working individually and together to raise the ambitious but achievable sums needed to do the job.
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Financing a Just Transition
THE LAST 12 MONTHS HAVE BEEN THE WARMEST ON RECORD. THE GREENHOUSE GAS EMISSIONS THAT HUMANS CONTINUE TO PRODUCE TO POLLUTE THE ATMOSPHERE RELENTLESSLY ADD TO THE HISTORICALLY HIGH CONCENTRATIONS ALREADY THERE. THE LAST 12 MONTHS HA THE WARMEST ON RECOR GREENHOUSE GAS EMISS THAT HUMANS CONTINUE PRODUCE TO POLLUTE TH ATMOSPHERE RELENTLES ADD TO THE HISTORICALL CONCENTRATIONS ALREA
to take action within their respective capacity. But even with a full commit- ment they cannot do the job alone. A turning point? The private sector is thus key to closing the climate finance gap. One estimate suggests that even if all multilateral development banks committed their entire balance sheet to the green tran- sition, it would only provide 4% of the capital needed. Merely 1.4% of the private sector’s $410 trillion in global financial assets would surpass the highest finance gap estimate. Mobilising private invest- ment is therefore critical. Climate finance will be a trillion-dollar market by 2030. Mobilising this capital is thus both a challenge for policymakers and an opportunity for business. Public and private sectors must act and work together Whether driving innovation or address- ing the global challenges arising from the triple planetary crisis of climate change, biodiversity loss and pollution, well-crafted policy and regulation can mobilise capital for sustainable devel- opment, promote transparency and
banking and insurance can lead the urgently needed environmental and energy transition. It showcases insights from existing efforts to close the finance gap, showing how policy innovation has led to credible progress, and how much more can and must be done. Leaders in policy, finance, development and sci- ence appraise solutions, giving insight into what has worked, what has failed, and what remains to be done. Their contributors in turn, address: ● Achieving adequate, ambitious, cli- mate finance ● The Paris Agreement platform ● Improving public finance ● Mobilising private sector finance ● Improving integrity for private sector finance ● Frontier technology – financing fit- for-future infrastructure ● Innovative climate financing.
disclosure, provide common language and standards, and foster collaboration among stakeholders. Without coherent policy, climate finance may not be sufficiently prior- itised by governments, the financial sector and its counterparties, leading to missed opportunities for investments to improve the planet’s future. Working to establish a global and col- laborative dialogue and approach will enable leading investors to work with both public and private sectors to cat- alyse change across the entire finance spectrum and help financial institu- tions eliminate the financing gap to reach the Sustainable Development Goals. Every investment initiative is required to deliver real world sustainability outcomes, by engaging regulators to strengthen environmental, social and governance standards and by reimag- ining business practices that prioritise sustainable impact. This publication draws on the exper- tise, experience and commitment of key global leaders from major institu- tions and sectors to show how finance from capital markets, asset manage- ment, corporate finance, international
Æ JOHN KIRTON ÅäÝã ÆÞçéäã Þè éÝÚ ÙÞçÚØéäç äÛ éÝÚ Âáä×Öá ÂäëÚçãÖãØÚ ËçäÜçÖâ ìÝÞØÝ ÞãØáêÙÚè éÝÚ Â ÍÚèÚÖçØÝ Âçäêå éÝÚ Â# ÍÚèÚÖçØÝ Âçäêå éÝÚ ½ÍľÎÍÚèÚÖçØÝÂçäêåÖãÙéÝÚÂáä×ÖáÃÚÖáéÝ¿ÞåáäâÖØîËçäÜçÖâÖééÝÚÐãÞëÚçèÞéîäÛÏäçäãéäìÝÚçÚÝÚÞèÖåçäÛÚèèäçÚâÚçÞéêèäÛåäáÞéÞØÖá èØÞÚãØÚÃÚÞèéÝÚØäxÖêéÝäçìÞéÝÀááÖÆäàäéèÞèÖãÙ½çÞééÖãÚîÒÖççÚãäÛ ÍÚØäãěÜêçÞãÜéÝÚÂáä×ÖáÂäëÚçãÖãØÚäÛ¾áÞâÖéÚ¾ÝÖãÜÚ ÖãÙìÞéÝÀááÖ ÆäàäéèÞè ÏÝÚÂáä×ÖáÂäëÚçãÖãØÚäÛ¾áÞâÖéÚ¾ÝÖãÜÚÂ# ÖãÙÐÉÇÚÖÙÚçèÝÞå . He is also co-editor of  ½çÖïÞáÏÝÚ ÍÞäÎêââÞé ÖèìÚáá ÖèÖÜáä×ÖáÝÚÖáéÝèÚçÞÚèÞãØáêÙÞãÜéÝÚçÚØÚãé ÃÚÖáéݼËäáÞéÞØÖá¾ÝäÞØÚ½êÞáÙÞãÜÍÚèÞáÞÚãØÚÖãÙÏçêèé . @jjkirton : www.g7g20.utoronto.ca
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INTRODUCTION: ACHIEVING ADEQUATE, AMBITIOUS CLIMATE FINANCE
1.2
Bridging the gap between ambition and action The challenges are as complex
A s the race to cap global temperature increases at 1.5°C above pre-industrial levels intensifies, mobilising substantial climate finance is urgent – particularly for the world’s most vulnerable communities on the front lines of the climate crisis. Financing a just transition, by empow- ering the most vulnerable to build climate-resilient communities, is imper- ative. As Mia Mottley, prime minister of Barbados, warned at the United Nations General Assembly in September 2024, “We have a date with destiny against 1.5 degrees”. Estimates by the London School of Eco- nomics and the Grantham Research Institute on Climate Change and the Environment suggest that the transition to a low-carbon energy future for emerg- ing economies (excluding China) will require total annual investments of $1 trillion by 2025 and $2.4 trillion by 2030. Critical considerations Achieving a just transition is complex. It requires a comprehensive approach that balances social, economic and environ- mental considerations. The equitable distribution of financial resources must ensure that targeted investments reach the most vulnerable and marginal- ised groups affected by the devastating impacts of a changing climate. Fund- ing mechanisms including concessional loans, grants and loan guarantees must be accessible and affordable. Investments in green energy, renewables, energy effi- ciency and sustainable agriculture are needed to create green jobs and econo- mic diversification. Reskilling requires providing appropriate training pro- grammes for workers transitioning from carbon-intensive industries to emerging
as they are abundant. COP29 presents a critical opportunity to galvanise financial resources from both the public and private sectors – a pivotal moment on the way to a just and sustainable transition. Ella Kokotsis, director of climate finance strategy, Global Governance Program ACHIEVING A JUST TRANSITION IS COMPLEX. IT REQUIRES A COMPREHENSIVE APPROACH THAT ½¼Ç¼É¾ÀÎÎÊ¾Ä¼Ç ECONOMIC AND ENVIRONMENTAL CONSIDERATIONS. THE EQUITABLE DISTRIBUTION OF FINANCIAL RESOURCES MUST ENSURE THAT TARGETED INVESTMENTS REACH THE MOST VULNERABLE.
green sectors. Prioritising gender and social equity is critical, ensuring that women, youth, Indigenous popula- tions and marginalised communities all have equitable access to climate- related decision-making as well as financial resources. Policy frameworks that encourage private sector invest- ments in low-carbon, climate-resilient infrastructure must underpin this pro- cess. The challenge is daunting. Innovative funding mechanisms are key to bridging the growing climate finance gap. Leveraging private sector investments, exploring blended finance options and enhancing the role of mul- tilateral development banks can help. A central challenge is ensuring that finance is distributed equitably, par- ticularly in the world’s most vulnerable communities where adaptation, loss and damage are top priorities. Climate finance, emphasising the urgent need to mobilise public and private financing from all sources, has emerged at the forefront of the agenda of the meeting of the 29th Conference of the Parties to the United Nations Framework Convention on Climate Change in Baku in November 2024. Leaders there will focus on three key climate finance objectives, as global climate challenges escalate. The first objective calls for an agree- ment on the new collective quantified goal on climate finance, ensuring ambi- tious and deliverable commitments with clear rules to define who will contribute, for what purpose, over what timeframe and how progress will be monitored. The second objective is to move for- ward on monitoring and evaluating critical areas where more climate invest- ment is needed to address emissions reductions and adaptation outcomes.
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Financing a Just Transition
them less attractive to private investors seeking substantial near-term invest- ment gains. Weaknesses and gaps in the climate finance information ecosystem can also hamper evidence-based decision- making and effective policy develop- ment. Without robust climate data and disclosures, it is difficult for investors to determine the potential benefits of their climate-based investments. Additionally, ongoing global crises and geopolitical tensions divert atten- tion and resources from climate action. The Russia–Ukraine conflict has shifted global energy markets, with some coun- tries, including Austria, Germany, Italy and the Netherlands, extending the life of coal-fired power facilities in the short term to ensure their energy security. Yet these challenges also present opportunities. For instance, the Global Innovation Lab for Climate Finance reflects an investor-led initiative, blend- ing public-private capital to accelerate innovation and de-risk climate invest- ments in EMDCs. Sustainability-linked loans and bonds offer flexible funding for green projects with better interest rates for borrowers when they meet their sus- tainability targets. Prospects for COP29 As the host of COP29, Azerbaijan has the potential to lead on climate action by example, having pledged to reduce emissions by 40% by 2050 and increase renewable capacity to 30% by 2030. Unlocking the transformative finance action needed to support vulnera- ble communities in the climate fight, while prioritising women, youth and Indigenous peoples, is key. With strong leadership, inclusive dialogue and a shared commitment to ensuring a just transition, COP29 can mark a turning point in the global response to climate change, with climate finance serving as a powerful tool to drive progress and ensure a just, equitable and sustainable transition.
The transition to a low-carbon energy future for emerging economies (exclud- ing China) will require total annual investments of an estimated $1 trillion by 2025 and $2.4 trillion by 2030. $ 1 tr $ 2.4 tr
The Baku Global Climate Transparency Platform, launched in September 2024, is crucial for establishing robust indica- tors, tracking progress and ensuring accountability on climate finance commitments. The third objective is to raise $1 billion in annual con- tributions for the Climate Finance Action Fund, introduced by Azerbaijan in July 2024. Those will come from fossil fuel– producing companies and countries producing oil, gas and coal, to capitalise the CFAF either through annual fixed sum contributions or based on their volume of production. Overcoming the obstacles But significant challenges remain in scaling up climate finance to the required levels. A complex and fragmented climate funding architecture makes it difficult for emerg- ing markets and developing countries to access mitigation and adaptation climate finance. Public resources for climate investments in EMDCs are often limited due to high borrow- ing costs and debt burdens. Moreover, a lack of institutional capacity and technical expertise hinders the development of robust adaptation and mitigation strategies. From an investment perspective, climate projects often strug- gle to generate sufficient financial returns, diminishing their appeal to profit-driven investors. Payback periods can span dec- ades on small-scale and localised climate initiatives, making
Æ ELLA KOKOTSIS ÀááÖ ÆäàäéèÞè ËÝ¿ èÚçëÚè Öè éÝÚ ÙÞçÚØéäç äÛ ØáÞâÖéÚ ěãÖãØÚ èéçÖéÚÜî Ûäç éÝÚ Âáä×Öá ÂäëÚçãÖãØÚ ËçäÜçÖâ ÒÞéÝ ãÚÖçáî éÝçÚÚ ÙÚØÖÙÚèą ÚíåÚçÞÚãØÚÖééÚãÙÞãÜÂ#ÖãÙ èêââÞéèèÝÚÞèÖáÚÖÙÞãÜÚíåÚçéÞãèêââÞéØäâåáÞÖãØÚÖãÙÖØØäêãéÖ×ÞáÞéîÃÚçèØÝäáÖçáîØäãéçÞ×êéÞäãèÞãØáêÙÚ ãêâÚçäêèåê×áÞØÖéÞäãèäãèêââÞéÙÞåáäâÖØîÖãÙèÝÚÞèçÚÜêáÖçáîÞãëÞéÚÙéäèÝÖçÚÝÚçÞãèÞÜÝéèÖèÖèåÚÖàÚçÖéÞãéÚçãÖéÞäãÖáØäãÛÚçÚãØÚèäãÜáä×Öá ÜäëÚçãÖãØÚÀááÖÞèéÝÚÖêéÝäçäÛ ÆÚÚåÞãÜÄãéÚçãÖéÞäãÖá¾äââÞéâÚãéè¾äâåáÞÖãØÚ¾çÚÙÞ×ÞáÞéîÖãÙéÝÚÂ# and co-author of T ÝÚÂáä×ÖáÂäëÚçã - ÖãØÚäÛ¾áÞâÖéÚ¾ÝÖãÜÚÂ# ÖãÙÐÉÇÚÖÙÚçèÝÞå and ÍÚØäãěÜêçÞãÜéÝÚÂáä×ÖáÂäëÚçãÖãØÚäÛ¾áÞâÖéÚ¾ÝÖãÜÚ . : www.g7g20.utoronto.ca
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INTRODUCTION: ACHIEVING ADEQUATE, AMBITIOUS CLIMATE FINANCE
1.3
A moment of profound fracture
To avoid falling into a world of clean energy haves and have- nots, we must scale up interna- tional climate financing.
I n the past decade we’ve seen some real progress [on climate finance]. Over a trillion dollars was invested in climate action last year glob- ally. Up from a few hundred billion a decade ago. According to the OECD [Organisation for Economic Co-operation and Devel- opment], in 2022 developed countries provided and mobilised more than $100 billion in climate finance to developing countries. We got this far because first-movers and smart governments – who had the means – seized their chance. They saw the opportunity and grabbed it. But … this is nowhere near enough. This year we’ve seen hundreds of bil- lions of dollars of damage to countries rich and poor. So many have suffered from Hurricane Milton and Helene’s devastating dam- age. My own home island of Carriacou took a direct hit from Hurricane Beryl only a few months ago. And even those who’ve avoided direct damages have been hit hard by inflation as supply chains are blocked and broken. We simply can’t afford a world of clean energy haves and have-nots. In a two- speed global transition, pretty soon everyone loses. Because we can only prevent the climate crisis from decimating all econ- omies – including the largest – if every nation has the means to slash green- house gas pollution and boost climate resilience … Doing so is a crucial investment to pro- tect the global economy, and will be a fraction of the costs every nation will pay if we allow the climate crisis to keep run- ning rampant, devastating more and more lives and livelihoods every year … International climate finance must grow up, step up, and scale up, to meet this moment …
Multilateral Development Banks will be at the heart of this transition. Just this week the World Bank announced more concessional lending for climate. And the IMF [International Monetary Fund] is looking at ways to incorporate climate action and risks right across their work. This is good news. But incremental increases won’t lead to an exponential surge of investment and green growth. On climate finance, we have a need for speed, and without much larger scale, all economies will fail. So many countries are fac- ing debt crises that amount to fiscal straight-jackets, making it near- impossible to invest in climate action. … We must see further signals that the World Bank and IMF are committed to ensuring developing countries have funds and fiscal space for climate action and investment, not devastating debts and sky-high costs of capital. Debt relief and introducing more climate-related debt clauses are a start. So is replenishing the World Bank’s International Development Association. And it’s not just up to development banks. The G20 countries are their larg- est shareholders and must fund them properly and demand more, includ- ing wider reforms to the international financial architecture, while also work- ing to find new and innovative sources of finance. Under Brazil’s G20 leadership, climate and finance ministers have finally been brought together. This essential collab- oration must continue and be translated into clear outcomes. Progress on climate finance outside our negotiation process enables break- throughs within it and vice-versa. If we fail at either, it could be a knock-out blow to crucial parts of the Paris Agreement. So ambitious outcomes … are vital to
Simon Stiell, executive secretary, UN Climate Change
BECAUSE WE CAN ONLY PREVENT THE CLIMATE CRISIS FROM DECIMATING ALL ECONOMIES – INCLUDING THE LARGEST – IF EVERY NATION HAS THE MEANS.
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Financing a Just Transition
enable bolder climate actions that boost economies and strengthen societies everywhere. At COP29 [meeting of the 29th Conference of the Parties to the United Nations Framework Convention on Climate Change] in Baku all govern- ments must agree a new goal for inter- national climate finance that truly responds to the needs of developing countries. COP29 must be the stand-and-deliver COP, recognising that climate finance is core business to save the global economy and billions of lives and liveli- hoods from rampaging climate impacts. It’s … clear public finance [that] must be at the core. As much of this finance as possible needs to be grant or conces- sional, and must be made more accessible to those who need it most. And we must make climate cash count, wherever possible leverag- ing more private finance and sending signals to financial markets that green
is where the gains are … It’s also important we put in place mechanisms to track and ensure that promised funds are delivered. More work also has to be done to rap- idly ramp up funding for adaptation and get international carbon markets work- ing for everyone. We must fund a new generation of national climate plans. To protect the progress we made at COP28, and convert the pledges … – to triple renewable energy, double energy efficiency, boost adaptation and tran- sition away from fossil fuels – into real-world, real-economy results. And we must get the Loss and Damage Fund working fully, dispersing money to those who need it most. This is a moment of profound fracture between nations and within them. In times like these, there is a temptation to turn inward. A delusional belief that what happens in my neighbor’s back- yard is not my problem or my concern. If we go down this path, it will soon be
Dedicated professionals ensuring a brighter sustainable future through solar energy
game-over in the world’s climate fight. So let’s instead choose the game- changer path ahead – the one that recognises that bigger and better climate finance is entirely in every nation’s interests, and can deliver results everywhere. Let’s choose the path that focuses on solutions, and ensuring the massive benefits of bolder climate action – stronger growth, more jobs, better health, secure and affordable clean energy – are within all nations’ reach. That is the only pathway to every nation surviving and thriving. Brookings Institution’s Global Economy and Development Programme, 17 Octo- ber 2024
Æ SIMON STIELL ÎÞâäãÎéÞÚááìÖèÖååäÞãéÚÙÚíÚØêéÞëÚèÚØçÚéÖçîäÛéÝÚÐãÞéÚÙÉÖéÞäãèÁçÖâÚìäçà¾äãëÚãéÞäãäã¾áÞâÖéÚ¾ÝÖãÜÚÞã ËçÚëÞäêèáîÝÚèÚçëÚÙ ÖèéÝÚâÞãÞèéÚçÛäçØáÞâÖéÚçÚèÞáÞÚãØÚÖãÙéÝÚÚãëÞçäãâÚãéÞãéÝÚÂäëÚçãâÚãéäÛÂçÚãÖÙÖÛçäâ éÝçäêÜÝ ÖãÙÚÖçáÞÚçâÞãÞèéÚçÛäç ÚÙêØÖéÞäãÖãÙÝêâÖãçÚèäêçØÚÙÚëÚáäåâÚãéâÞãÞèéÚçäÛèéÖéÚçÚèåäãèÞ×áÚÛäçÝêâÖãçÚèäêçØÚÙÚëÚáäåâÚãéÖãÙéÝÚÚãëÞçäãâÚãéÖãÙåÖç - áÞÖâÚãéÖçîèÚØçÚéÖçîÞãéÝÚÈÞãÞèéçîäÛ¼ÜçÞØêáéêçÚÇÖãÙèÁäçÚèéçîÖãÙÁÞèÝÚçÞÚè½ÚÛäçÚßäÞãÞãÜéÝÚÜäëÚçãâÚãéÝÚÝÚáÙèÚãÞäçÚíÚØêéÞëÚ åäèÞéÞäãèÞãéÝÚéÚØÝãäáäÜîèÚØéäç
@simonstiell : unfccc.int
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INTRODUCTION: ACHIEVING ADEQUATE, AMBITIOUS CLIMATE FINANCE
1.4
A crucial transformation
Aside from its ambitious climate change commitments, India is also looking to drive the uptake and research of green hydrogen.
T he world is going through a crucial transformation. There is a growing realisa- tion that climate change is not just a matter of the future. The impact of climate change is being felt here and now. The time for action is also here and now. Energy transition and sustainability have become central to global policy discourse. India is committed [to] creating a cleaner and greener planet. We were the first among G20 nations to ful- fill our Paris commitments on green energy. These commitments were ful- filled 9 years ahead of the target of 2030. India’s installed non-fossil fuel capacity increased nearly 300% in the last 10 years. Our solar energy capac- ity increased over 3,000% in the same period. But we are not resting on these achievements. We remain focused on strengthening existing solutions. We are also looking at new and innovative areas. This is where Green Hydrogen comes into the picture. Green Hydrogen is emerging as a promising addition to the world’s energy landscape. It can help in decar- bonizing industries that are difficult to electrify. Refineries, fertilizers, steel, heavy-duty transportation – many such sectors will benefit. Green Hydrogen can also act as a storage solution for sur- plus renewable energy. India has already launched the National Green Hydrogen Mission in 2023.
Narendra Modi, prime minister, India
We want to make India a global hub for the production, utilization, and export of Green Hydrogen. The National Green Hydrogen Mission is giving an impetus to innovation, infrastructure, indus- try, and investment. We are investing in cutting-edge research and develop- ment. Partnerships between industry and academia are being formed. Start- ups and entrepreneurs who are working in this domain are being encouraged. There is also a great potential for a green jobs eco-system to develop. To enable this, we are also working on skill development for our youth in this sector. Climate change and energy transi- tion are global concerns. Our answers also need to be global in nature. Inter- national partnership is critical for promoting Green Hydrogen’s impact on decarbonization. Scaling up produc- tion, minimising costs and building infrastructure can happen faster through cooperation. We also need to jointly invest in research and innovation to push technology further. In Septem- ber 2023, the G20 Summit happened in India. In this Summit, there was a spe- cial focus on Green Hydrogen. The New Delhi G-20 Leaders’ declaration adopted five high-level voluntary principles on Hydrogen. These principles are helping us in the creation of a unified roadmap. All of us must remember – the decisions we make now, will decide the life of our future generations. In such a crucial sector, it is important for domain experts to lead the way and
CLIMATE CHANGE AND ENERGY TRANSITION ARE GLOBAL CONCERNS. OUR ANSWERS ALSO NEED TO BE GLOBAL IN NATURE.
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Financing a Just Transition
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INTRODUCTION: ACHIEVING ADEQUATE, AMBITIOUS CLIMATE FINANCE
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ALL OF US MUST REMEMBER – THE DECISIONS WE MAKE ÉÊÒÒÄÇÇ¿À¾Ä¿ÀÏÃÀÇÄÁÀÊÁ OUR FUTURE GENERATIONS.
work together. Particularly, I urge the global scientific community to come together to explore various aspects. Scientists and innovators can suggest changes in public policy to help the Green Hydrogen sector. There are also many questions that the scientific com- munity can look into. Can we improve the efficiency of electrolysers and other components in Green Hydrogen production? Can we explore the use of sea water and municipal wastewater for production? How can we enable the use of Green Hydrogen in public trans- port, shipping, and inland waterways? Exploring such topics together will greatly help green energy transition across the world ... Humanity has faced many challenges in the past. Each time, we overcame adversities through solutions that were collective and innovative. It [is] the same spirit of collective and innovative action that will guide us towards a sustainable future. We can achieve anything when we are together. Let us work to acceler- ate the development and deployment of Green Hydrogen. Video message for 2nd International Conference on Green Hydrogen, 11 September 2024 In 2015, the ISA [International Solar Alliance] began as a small sapling, it was a moment of hope and aspira- tion. Today it is growing into [a] giant tree inspiring policy and action. In such a short time, the Membership of ISA [has] reached a milestone of [a] hundred countries. Additionally, 19 more countries are ratifying the frame- work agreement for attaining full membership. The growth of this organi- zation is important for the vision of ‘One World, One Sun, One Grid.’ In the past few years, India has taken many massive strides in green energy. We were the first G20 Nation to achieve
the Paris commitments in renewable energy. The remarkable growth of solar energy is a key reason in making this possible. Our solar energy capacity has increased 32-fold in the last 10 years. This speed and scale will also help us achieve five hundred (500) gigawatt non-fossil capacity by 2030. India’s growth in the solar sector is the result of a clear approach. Whether in India or in the world, the mantra to increase solar adoption is aware- ness, availability and affordability. [We] increased awareness about the need [for] sustainable energy sources by encouraging domestic manufac- turing in the solar sector we increase availability. Through specific schemes and incentives, we also made the solar option affordable. ISA is an ideal platform for exchang- ing ideas and best practices for solar adoption. India has a lot to share as well. Let me give you an example [of] a recent policy intervention. A few months ago, we launched the PM Surya Ghar Muft Bijli Yojana. We are investing Rupees 750 billion in this scheme. Our target is to help 10 million households to install their own rooftop solar panels. We are trans- ferring financial assistance directly to the people’s bank accounts. Low inter- est, collateral free loans are also being enabled in case additional finance is needed. Now, these households are generating clean electricity for their needs. Moreover, they will also be able to sell excess power to the grid and earn money. Due to the incentives and poten- tial earnings, this scheme is becoming popular. Solar energy is being seen as an affordable and attractive option. I am sure many nations have similar valuable insights derived from their work on energy transition. In a short time, the ISA has made a lot of progress. In 44 countries, it has
India’s installed non-fossil fuel capacity increased nearly 300% in the last 10 years. Our solar energy capac- ity increased over 3,000% in the same period. 300 % 3000 %
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Financing a Just Transition
assisted in developing nearly 10 giga- watts of electricity. The Alliance has also played a role in bringing down the global prices of solar pumps. Private sector investment is being enabled, especially in African member countries. A number of promising solar startups from Africa, Asia-Pacific, and India are being encouraged. This initiative will also be expanded to Latin America and the Caribbean soon. These are note- worthy steps in the right direction. To ensure an energy transition, the world must collectively discuss some important matters. The imbal- ance in concentration of green energy investments need to be addressed.
Manufacturing and technology need to be democratised to help develop- ing countries. Empowering Least Developed Countries and Small Island Developing States should be a top priority. Inclusion of marginalised communities, women and youth is cru- cial ... India is committed to work with the world for a green future. During the G20 last year, we led the creation of the Global Biofuels Alliance. We are also one of the founding members of the International Solar Alliance. Every effort to build an inclusive, clean and green planet will have India’s support. First International Solar Festival, 5 September 2024
Wind turbines in Nagercoil, South India
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INTRODUCTION: ACHIEVING ADEQUATE, AMBITIOUS CLIMATE FINANCE
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Taking a global role in the climate crisis
The world’s fight against climate change will be more effective if countries join forces.
Luiz Inácio Lula da Silva, president, Brazil
T he [Pact for Ecological Trans- formation between the Three Powers of the Brazilian State] … symbolizes the determina- tion of each of us to face the greatest challenges of our time, with the depth and urgency that the climate crisis demands. The union of the Three Powers around a common proposal is a testament to the strength and maturity of our democracy. The 1988 Constitution, written under the aegis of hope, enshrines the right to an ecologically balanced environment. This Pact, however, is more than the fulfillment of a legal duty. It is a pact of responsibility towards our beloved planet. The storms that devastated the South and the droughts that punished the Ama- zon are nature’s warning cries, calling for our attention. And our actions will be more effec- tive when we join forces, towards a development model that respects human dignity and the integrity of our ecosystems. We have established a new frame- work for the country, in which ecological sustainability, economic development and social and climate justice become central pillars of our public policies. The commitments we have made in this Pact range from prioritizing environ- mental legislation to accelerating land use planning. From the transition to a low- carbon economy to encouraging
WE NEED TO REMEMBER THAT THE CLIMATE AGENDA IS NOT A COST. IN ADDITION TO BEING ESSENTIAL FOR THE SURVIVAL OF THE PLANET ¼É¿ÃÐȼÉÄÏÔ IT GENERATES EMPLOYMENT AND INCOME OPPORTUNITIES.
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Financing a Just Transition
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