Straight from COP26
Nigel Topping
High Level Champion for Climate Action at COP26
Regions, cities, investors, businesses and governments are stepping up to build resilience in the most at-risk communities and reverse biodiversity loss within the 2020s.
In brief
33 financial institutions, with around US$8.7 trillion in assets, commit to tackling deforestation driven by agricultural commodities in their portfolios by 2025, with a focus on palm oil, soy, beef, and pulp and paper.
At least $10 billion is going towards accelerating and scaling up an equitable energy transition for a billion people in developing and emerging economies by 2030, through the Global Energy Alliance for People & Planet launching today.
The High-Level Climate Champions, with businesses, investors, cities and regions, today unveil new partnerships to boost climate equity and resilience in Africa and small island developing states and regenerate nature. Among them:
The African Green Finance Coalition will help African countries work together to build capacity, credibility and opportunities for green investment across the continent. This enables African countries to look beyond aid and tap into the shift in financial markets towards sustainable and resilient investment.
The AFR100 initiative calls on peers to raise $2 billion of investable capital to accelerate Africa’s locally led restoration of degraded land by COP27 in November 2022, in support of the $400 million already mobilized.
Bank of America today announces the creation of a new finance vehicle that will invest in approximately 8 gigawatts in shovel-ready wind, solar and electric vehicle charging infrastructure projects in the Caribbean.
Eight Pacific island states - Fiji, Kiribati, Papua New Guinea, Samoa, the Solomon Islands, Tonga, Tuvalu and Vanuatu - are the first countries to receive climate finance advisors through the new Climate Finance Access Network, aimed at building financial capacity and developing project pipelines across islands in the region.
The new Regen10 Coalition brings together farmers, the private sector and governments to ensure that by 2030: half of the world’s food is produced in a way that benefits people, nature and the climate; that over 500 million farmers are paid fairly for farming regeneratively; and that roughly $60 billion per year is deployed to finance the transition.
Bloomberg Philanthropies launched a new campaign on Monday to close a quarter of the world’s 2,445 remaining coal plants and all 519 proposed coal plants by 2025 by expanding its efforts to an additional 25 developing countries where coal power is projected to rapidly grow. It already works in seven countries and the EU.
Over 100 private and public organizations partner for the launch of the Resilience Hub, with cultural organizations from around the world announcing a global resilience campaign as part of the UN-backed Race to Resilience campaign.
The UN-backed Race to Zero campaign’s membership has grown to 5,235 businesses, 67 regions, 441 financial institutions, 1,039 educational institutions and 52 healthcare institutions - all committed to halving emissions between 2020 and 2030. The Cities Race to Zero now counts 1,049 cities.
In depth
Financing Nature & Sustainable Development
Tackling agricultural commodity-driven deforestation: The 33 financial institutions, with around $8.7 trillion in assets, will make best efforts to eliminate deforestation from agricultural commodities from their portfolios by 2025. They will plan to spread the phaseout across supply chains and operations in areas such as palm oil, soy, beef, and pulp and paper. Advisory group members include: Global Canopy, Conservation International, Nature4Climate, High-Level Climate Champions, World Economic Forum’s Tropical Forest Alliance and the Principles for Responsible Investors.
→ Why it matters: Forest destruction currently draws about 40 times more financial support than forest protection, causing deforestation to produce around 8% of global CO2. Ending deforestation and boosting nature-based solutions could cover a third of the work needed to stay within 1.5°C. It will cost $700 billion per year to reverse biodiversity loss, according to The Nature Conservancy. That’s less than 1% of global GDP and 13% of the $5.2 trillion spent on fossil fuel subsidies every year, according to the IMF.
Global Energy Alliance for People & Planet: Starting with $10 billion in committed capital, the coalition of philanthropies, governments, donors, multilateral development banks, development finance institutions and private sector partners will roll out clean energy in developing and emerging economies worldwide. It will work across the transition from fossil fuels, including grid-based renewables and distributed renewables. This will save 4 billion tonnes of greenhouse gas emissions, provide clean energy to 1 billion underserved people, and create 150 millions green jobs within the decade.
→ Why it matters: A tenth of the population - around 800 million people - lack basic access to electricity, including around half of Sub-Saharan Africa. Another 1.5 billion lack access to reliable power, making it harder for farmers and businesses to operate and weakening the availability of modern healthcare and education.
Regen10: Aiming to ensure that by 2030, over half the world’s food is produced in a way that benefits people, nature and the climate. Regen10 brings together farmers, businesses, investors, policymakers and food sector initiatives to scale up regenerative and resilient food systems. It also aims to ensure that over 500 million farmers are paid fairly for farming regeneratively, and that roughly $60 billion per year is deployed to finance the transition.
→ Why it matters: Food systems currently generate $12 trillion a year in hidden costs compared to US$10 trillion in economic value (Food and Land Use Coalition). This exacerbates climate change, biodiversity loss and spread of zoonotic disease.
Finance for Africa
Africa Green Finance Coalition: The network of 43 African countries, co-chaired by Mali and Kenya, is today re-launching with a focus on boosting the continent’s ability to draw green investment capital from international funds and domestic institutional investors. As a platform that enables peer reviews and tracks progress in an accountable way, the coalition will help African countries draw investment, rather than just financial aid, for sustainable development and resilience. This will help to create jobs and other economic opportunities while keeping the continent’s emissions from rising.
Restoring African land: The call-to-action to raise $2 billion in investable capital by COP27 will support the restoration of degraded land in Africa under the leadership of the African Forest Landscape Restoration Initiative (AFR100), and in support of the Central African Forest Initiative and the Great Green Wall.
After six years of political mobilization, AFR100 needs to accelerate action through an implementation strategy, more locally relevant technical assistance, an increase in finance, and credible monitoring. The key to success is sustainably funding thousands of small-scale, community-based actions. No solution to Africa’s degradation crisis can ignore the fact that 75% of land across the continent is community-managed.
→Why it matters: More than 65% of Africa’s land is degraded. Millions of smallholder farmers, the backbone of rural economies across Africa, are working on that unproductive land. They need financial help now to restore their land for long term food security, and mitigate and adapt to the impacts of climate change. An initial $2 billion investment in the work of NGOs, entrepreneurs and government-led projects could catalyze $15 billion of funding. That larger amount could begin the restoration of a potential 20 million hectares by 2026 and bring an estimated $135 billion in benefits to 40 million people.
Africa Green Hydrogen Alliance: Accelerating the development of green hydrogen production and zero-carbon industrial growth in Africa, launched by Egypt, Kenya, Mauritania, Morocco, Namibia, South Africa with industry support. Countries will collaborate to develop green hydrogen strategies, legal and regulatory measures, product certification standards, and investment with developed country support. The alliance is supported and attended by the African Development Bank, the UN Economic Commission for Africa and the African Union Development Agency-New Partnership for Africa's Development.
→ Why it matters: Developing countries have an opportunity to jump straight to clean industrialization by using their wealth of renewable energy sources to produce green hydrogen. Coordinated efforts could help harness more than $100 billion in investment across African countries by 2030, improving energy security, affordability, domestic economic development and health while reducing fossil fuel use.
Africa, in particular, could leapfrog straight toward direct and indirect electrification with renewables. In a continent where half of citizens lack access to reliable, clean forms of power and cooking, green hydrogen can complement wind and solar energy for households and light industry as a cost effective input for heavy industry.
Finance for Small Island Developing States
Caribbean Clean Energy and Electric Charging Financing Facility: Bank of America today announces the creation of a new finance vehicle that will invest in approximately 8 gigawatts of wind, solar and electric vehicle charging infrastructure in shovel-ready projects in Caribbean small island developing states. This initiative could deliver a game-changing impact in accelerating clean energy transition and deployment in the region.
90% renewables by 2030 in the Caribbean: The Inter-American Development Bank, Caribbean Development Bank and the Green Climate Fund today announce plans to set up a multi-donor financing facility for small Caribbean island states, with support from Caribbean governments. The fund will spur public and private investment in climate solutions, mobilizing some of the $84 billion needed to transition to 90% renewable energy in the region by 2030. This would save about $24 billion per year in fuel costs, according to RMI’s latest research.
→ Why it matters: Decarbonizing key sectors of small island developing states’ economies can boost energy security by minimizing reliance on fossil fuel imports, creating jobs and building resilience to climate shocks. But the countries need innovative financing approaches for projects to both cut emissions and adapt to climate change. Without it, they remain locked in a cycle of growing debt and ageing, inefficient, dirty and costly infrastructure that exacerbates their vulnerability.
Climate Finance Access Network: Eight island nations - Fiji, Kiribati, Papua New Guinea, Samoa, the Solomon Islands, Tonga, Tuvalu and Vanuatu - will be the first to receive locally hired and trained embedded climate finance advisors through the Climate Finance Access Network, which is aimed at building financial capacity and developing project pipelines in small island developing states and least developed countries.
→ Why it matters: Navigating the climate finance system is complex and most small island developing states don’t have the capacity to navigate and structure the finance needed, according to the Climate Finance Access Network. Of the $29.5 billion in multilateral climate funds pledged between 2003 and 2017, only $5.6 billion was actually disbursed, it found.
Ending Coal
Bloomberg steps up the coal fight: Supporting UN Secretary-General Antònio Guterres’ call to phase out coal power in OECD and EU countries by 2030 and worldwide by 2040, Bloomberg Philanthropies on Monday announced it will work to close a quarter of the world’s 2,445 remaining coal plants and all 519 proposed coal plants by 2025. Bloomberg already leverages philanthropic funding to fill the gap, assume the risk and succeed in moving away from coal. It will expand to work in 25 developing countries where coal power is projected to grow rapidly, in addition to the seven developing countries and EU where it’s already active.
→ Why it matters: The burning of coal is the single largest contributor to climate change, accounting for a third of carbon emissions. Progress is underway - the US has shuttered or announced the retirement of over 65% of coal plants in the last decade, and nearly half of Europe’s coal fleet has been confirmed for retirement in the last five years, according to the updated Bloomberg Global Coal Countdown.
Building Resilience
Harnessing the power of culture and data to build resilience: The power of culture to mobilize society takes centre stage at the Resilience Hub at COP26, with the launch of the Coalition for Climate Resilient Investment’s art exhibit and the Climate Heritage Network’s global resilience campaign. The coalition’s Art + Resilience exhibition combines art and data to highlight the climate emergency and its consequences. Attendees at COP can follow the art trail and access interactive climate-related data.
As part of the Race to Resilience, the Climate Heritage Network has committed to gather a community of local governments, cultural institutions and organizations from 200 cities and regions committed to enhanced culture-based actions for resilience and adaptation. By 2030, aims to make 200 million people from vulnerable groups and communities more resilient to climate risks.
The future of non-state climate action: The UN High-Level Climate Champions welcome UN Secretary-General Antònio Guterres’ statement on Monday highlighting the need for a common understanding of standards for measuring and assessing non-state actor commitments. They look forward to working closely with him and his team to assemble the expert group he announced, as part of the work to drive credible commitments and action from cities, regions, businesses and investors.
The Race to Zero now counts 5,235 businesses, 67 regions, 441 financial institutions, 1,039 educational institutions and 52 healthcare institutions - all committed to halving emissions between 2020 and 2030.
Quotes
Gonzalo Muñoz, UN High-Level Climate Champions for COP25: “This is the decisive decade – the decade to deliver on the promise of Paris and the prospect of a better, safer, fairer, healthier future for everyone.”
Nigel Topping, UN High-Level Climate Champion for COP26: “To keep 1.5°C alive, we must cut global emissions five times faster than we have over the last decade, which requires transformative action that simultaneously builds resilience, and puts the most vulnerable communities at the heart of the conversation.”
Seyni Nafo, Co-chair of the Africa Green Finance Coalition: “The Africa Green Finance Coalition will benefit all African countries in helping to channel much-needed investment effectively and rapidly to local opportunities where it can be put to work. The AGFC demonstrates African leadership and ambition - investors in the green economy should feel very confident that Africa is a rewarding destination for their capital."
Ayaan Zainab Adam, CEO Africa Capital Partners: “Africa has a $2.3 trillion investment gap in its core infrastructure which must be addressed. The AGFC should help get much needed capital flowing to climate resilient and low carbon infrastructure in strategic sectors including energy, transport, logistics, agriculture and sustainable and low-carbon mining and manufacturing. This initiative will helpfully facilitate investment transactions across multiple countries requiring blended finance structures.”
Elizabeth Nsimadala, President of Eastern Africa Farmers Federation: “In Regen10 we are stepping up to show the courage and the leadership to scale a regenerative global food system in a decade. And we need world leaders to reciprocate. Together we can ensure by 2030, that over half of the world’s food is produced in a way that delivers good outcomes for people, nature, and our planet.”
Paul Polman, Co-Chair of FOLU & Founder of Imagine: “It is simply not possible to keep 1.5°C alive, halt and reverse nature loss, or deliver the Sustainable Development Goals unless we act now to radically transform food production and land use systems. A regenerative food system holds the key to all of these goals. It can reconnect us with nature, and it can reverse the environmental crisis before we hit the wall. It’s the best, fastest and cheapest solution we have to fight climate change and inequity. Scaling this to 50% by 2030 would cost around $60 billion a year. Less than 2% of the total investment required for the transition to net zero. Helping farmers doesn’t have to cost the earth. And the benefits would be huge."
Laetitia De Marez, Director of the Climate Finance Access Network: “Meeting the $100 billion goal is only half the battle when countries can’t access the funding that’s available now. The current climate finance model isn’t delivering for capacity-constrained island nations on the forefront of climate change. Building lasting capacity in-country to unlock climate finance has never been more critical or urgent. CFAN offers a pragmatic and country-owned model that locally hires, trains, and embeds finance advisors in ministries and direct access entities to develop bankable projects that address countries’ pressing climate priorities.”