All development is now taking place in a world shaped by climate. Climate change is happening now and impacting countries and people, with the poor the hardest hit.
In the first eight months of 2015, the world has seen more than 120 climate related disasters. Fourteen of the 15 hottest years since record keeping began over 130 years ago have been since the turn of the century (2000–2015).
As the third in the series of Turn Down the Heat reports prepared for the World Bank by the Potsdam Institute for Climate Impact Research shows, globally warming of close to 1.5°C above pre-industrial times – up from 0.8°C warming today – is already locked into Earth’s atmospheric system by past and predicted greenhouse gas emissions.
It warns everyone will feel the impact, particularly the poor, as weather extremes become more commons and risks to food, water, and energy security increase.
The World Bank Group is concerned that without bold action, the warming planet threatens to put prosperity out of reach of millions of people and roll back decades of development progress.
To meet the Global Goals by 2030, the world must cut emissions and invest in greater resilience to climate change. It is why ahead of the climate change conference - COP21 - in Paris in December, the World Bank Group is calling for an ambitious global agreement to help countries on a low carbon and resilient development path. It is a critical opportunity to galvanize political will for urgent action.
The World Bank Group is committed to tackling climate change. It is integral to its mission of eliminating extreme poverty and boosting shared prosperity. In just FY15 alone, the World Bank Group made 188 climate change-related investments in 59 countries, ranging from helping farmers adapt to a changing climate to new investments in renewable energy.
At the Bank Group’s Annual Meetings in Lima in October, the President Jim Yong Kim also announced a big increase in financing for climate to help meet rising demand from countries to tackle climate change. President announced the institution could, with the support of its members, increase climate financing up to $29 billion annually by 2020.
Immediate global action is needed to slow the growth in greenhouse gas emissions this decade and to help countries prepare for a warmer world and adapt to changes that are already locked in. Getting there will require economic transformations and a path to net zero emissions before the end of the century.
Creating the right incentives for the deep economic restructuring that’s needed and to crowd in financing for the future means getting prices right – ending fossil fuel subsidies and putting a price on carbon. Fossil fuel subsidies cost about $550 billion and studies show poor people do not benefit. Right now, about 40 countries and 23 cities, states and provinces are putting a price on carbon, comprising about 12 percent of annual greenhouse gas emissions.
Ahead of Paris, there is increasing momentum to price carbon pollution. It has been backed by a number of Heads of State as well as heads of city and regional governments. The leaders – who have taken steps to price carbon pollution and catalyze greener investment in their own countries and regions – have formed the carbon pricing panel, convened by the Bank Group, and the IMF, with support from the OECD.
A World Bank report, State and Trends of Carbon Pricing 2015 also shows the number of implemented or planned carbon pricing schemes around the world has almost doubled since 2012 and is now worth about $50 billion.
And drawing on experiences with carbon pricing initiatives around the world, new research lays out principles for governments and business to develop successful and cost-effective schemes to put a price on the social costs of greenhouse gas emissions.
The research by the Bank Group, the OECD with input from the IMF, says that well designed carbon pricing schemes are a powerful and flexible tool that can cut emissions causing climate change.
The FASTER Principles can be part of the toolkit for governments wanting to act to put a price on carbon to drive investment and protect people. The FASTER Principles are: F for fairness; A for alignment of policies and objectives; S for stability and predictability; T for transparency; E for efficiency and cost effectiveness and R for reliability and environmental integrity.
More and more companies realize that creating a low-carbon business strategy can be beneficial for their bottom-line. The Carbon Pricing Leadership Coalition, was initially formed from a groundswell of support for carbon pricing at the 2014 UN Climate Summit, where74 countries and over 1,000 businesses expressed their support for pricing carbon. It will be officially launched at the Paris climate talks.
Last Updated: Oct 23, 2015