The World Bank unveiled a series of climate change mitigation goals this week. Targets include developing more renewable energy and improving the ability of farmers to deal with climate change. The big deal is that the World bank is putting its money where its mouth is by projecting to spend $29 billion USD a year by 2020 on its Climate Change Action Plan.
The timing is important. Leaders from around the world will meet in New York in a few weeks to sign the climate agreement set in Paris last December. The agreement will set out a way forward to limit global warming to below 2 degrees Celsius - eying the agressive target of 1.5 degrees Celsius.
“Following the Paris climate agreement, we must now take bold action to protect our planet for future generations,” said World Bank Group President Jim Yong Kim. “We are moving urgently to help countries make major transitions to increase sources of renewable energy, decrease high-carbon energy sources, develop green transport systems, and build sustainable, livable cities for growing urban populations. Developing countries want our help to implement their national climate plans, and we’ll do all we can to help them.”
Throwing down the financial gauntlet may help incentivize countries to both sign the agreement and make financial contributions that will help meet the $100 million USD per year spending goal of the UN Green Climate Fund. The "fundamental shift" in priorities, as the World Bank calls it, is aimed at addressing the projection that climate change could push 100 million people back into poverty.
If it all works, the World bank will help add enough renewable energy to the world that can power 150 million homes. It also aims to provide agricultural investments in "climate-smart" programs in at least 40 countries by the 2020 target. In sum, the Bank will spend more than one out of every four dollars on addressing climate change. That impact can be multiplied if it meets its own goal of leveraging $25 billion USD in commercial financing over the next 5 years.
The spending goal itself is not new. The Bank announced its plans back in October to increase climate financing to as much as $29 billion anually by 2020. As it stands, the plan will increase annual climate spending from $2.2 billion per year to $3.5 billion. The commercial financing and the hope for $13 billion in annual private sector spending will help get to that overall goal.