The World Bank Group played a pioneering role in the development of carbon markets under the Kyoto Protocol, and has substantively ramped up its climate commitments since the 2015 Paris Agreement. Leveraging its expertise, convening power and competitive advantage, the Bank Group is committed to continue playing a central role in developing the next generation of climate markets and enhancing its carbon pricing policy development and implementation support to client countries.
The Bank Group Climate Group’s strategy on climate markets and innovation emphasizes the need to enhance global ambition by advocating for markets, building capacity and mobilizing capital for resilient and low carbon growth. To support these goals, the World Bank’s efforts focus on assisting client countries design and deploy explicit carbon pricing policies that are appropriate to their domestic context and compatible with their sustainable development priorities; as well as catalyzing the development of the next generation of international carbon markets through pilots. In this context, key initiatives related to the Climate Warehouse program include the following:
- Partnership for Market Readiness (PMR) provides funding and technical assistance to countries to build readiness for carbon pricing. It also seeks to build knowledge that supports the design of effective carbon pricing instruments and convening knowledge exchanges that promote best practices.
- Partnership for Market Implementation (PMI) will focus on helping countries embarking on carbon pricing move from readiness to rollout. In doing so, it seeks to assist participant countries design, pilot and implement explicit carbon pricing instruments aligned with their domestic development priorities.
- Carbon Pricing Leadership Coalition is a voluntary initiative that catalyzes action towards the successful implementation of carbon pricing around the world. The CPLC brings together leaders from government, business, civil society and academia to support carbon pricing, share experiences and enhance the global, regional, national and sub-national understanding of carbon pricing implementation. The CPLC Secretariat is administered by the World Bank Group.
- The Networked Carbon Markets initiative is a forward-looking work program that examines trends and potential future gaps and opportunities in order to develop new conceptual frameworks, financial products and technology applications that could be adopted by climate markets. The Climate Warehouse program identifies practical applications for new concepts explored by NCM that have long-term growth or replication potential. These concepts are further tested under the Climate Warehouse program to produce lessons for further scale-up.
- Carbon funds are established by the World Bank to develop emission reduction projects and support their purchase through the provision of carbon finance investments.
- Transformative Carbon Asset Facility (TCAF) is an international finance facility piloting innovative, results-based carbon market mechanism under Article 6 of the Paris Agreement.
- Carbon Initiative for Development (Ci-Dev) is a World Bank trust fund that mobilizes private finance for clean energy access in low-income countries.
- Carbon Partnership Facility (CPF) is a carbon finance instrument targeting the post-2012 period (the Kyoto Protocol’s first commitment period ends on December 2012).
- Forest Carbon Partnership Facility (FCPF) is a global partnership of governments, businesses, civil society, and indigenous people's organizations focused on reducing emissions from deforestation and forest degradation, forest carbon stock conservation, the sustainable management of forests, and the enhancement of forest carbon stocks in developing countries, activities commonly referred to as REDD+.
- Flagship analytical work:
- State and Trends of Carbon Pricing is an annual report that provides an up-to-date overview of existing and emerging carbon pricing instruments around the world, including international, national and subnational initiatives.
- Innovate4Climate (I4C) is a platform that promotes dialogue among the public and private sector on innovative ways to mobilize finance towards climate action. It is the preeminent global conference where leaders from government, industry, business, finance, and technology, gather to envision the next generation of climate-smart solutions with the potential to transform the global economy.