Global Commission on the Economy and Climate has issued a new report encouraging governments and finance institutions to scale up and move investment for sustainable infrastructure as a fundamental strategy to spur growth.
“Investing in sustainable infrastructure is essential to solve all the world’s most pressing problems,” said Felipe Calderón, former President of Mexico and Chair of the Global Commission. “It’s key to reigniting global growth. It’s key to reducing poverty. And it’s key to meeting the Paris Agreement. Infrastructure can be the pillar on which we build a sustainable economy, or it can crumble beneath us. It all depends on whether we get financing right, only then will capital fully shift in the low-carbon direction.”
The Sustainable Infrastructure Imperative: Financing for Better Growth and Development identifies the main barriers to financing sustainable infrastructure and lays out an action agenda for unlocking the capital required. The report was launched by President Felipe Calderón and Lord Nicholas Stern as well as other Global Commissioners at an event hosted by President Luis Alberto Moreno at the Inter-American Development Bank in Washington, DC.
The report finds that investments totalling about US$90 trillion will be needed in infrastructure over the next 15 years, more than is in place in our entire current stock, even if we continue under business-as-usual development. The good news is that it does not need to cost much more to ensure that this infrastructure delivers a low-carbon economy consistent with the climate goals agreed in Paris, and fuel and other operational savings can fully offset any additional up-front investments.
Meeting these investment needs will require a combination of public and private investment, with public investment used strategically to help crowd-in or leverage further private investment. The report also breaks down future infrastructure needs by sector and country groupings. It finds that the global South will account for roughly two-thirds of investment, with energy and transport sectors dominating.
The report notes that a single infrastructure project can require dozens of financial institutions, all with their own demands, and take more than a decade to build. The cost of project preparation is substantial, typically 2.5–5% of total investment. And the risk-return ratio for sustainable infrastructure is often too high to attract private capital.
The Global Commission identifies four action areas to finance sustainable infrastructure at the scale required:
- Tackle fundamental price distortions through fossil fuel subsidy reform and carbon pricing. Fossil fuel subsidies amounted to around US$550 billion in 2014, skewing investment away from sustainable options.
- Strengthen policy frameworks and institutional capacities. Better planning and governance can ensure the right projects are selected in the first place, and the right financing is used at the right time.
- Transform the financial system through new tools like green bonds and green investment banking, and by greening the existing financial system, including through corporate climate risk disclosure.
- Ramp up investments in innovation and deployment of clean technologies to reduce the upfront costs of sustainable infrastructure.
Lord Nicholas Stern, leading economist and co-Chair the Commission:
The next couple of decades, and particularly the next two or three years, will be critical to the future of sustainable development.
“We can and should invest in and build cities where we can move and breathe and be productive, while protecting the natural world that underpins our livelihoods. We cannot continue with ‘business as usual’ which will lock in high-carbon infrastructure and create further congestion and pollution, while choking off development opportunities, particularly for poor people. This will require not only better policies but also a sea change in the financial system itself to make it fit for purpose for the scale and quality of investment we now need. The development banks, both national and international, should be at the centre of this: the growth story of the future.”
Ngozi Okonjo-Iweala, former finance minister of Nigeria and Commissioner: “Our action agenda in this report knits together sustainable growth with development gains. It makes clear that the role of governments, the private sector, and development banks varies depending on a country’s stage of development. And it’s an especially exciting opportunity for the developing world, where we are just starting to build fundamental infrastructure, to show real leadership thanks to the opportunities to skip over the inefficient, polluting systems of the past.”
Caio Koch-Weser, former Vice Chairman of Deutsche Bank and Commissioner: “Green finance and climate risk are two sides of the same coin. The finance sector is increasingly grasping the opportunity side of the low-carbon transition. But any prudent investor looks not only at the opportunities in the portfolio, but also the risks, especially of legacy investments. Clear definitions of what counts as green on the one hand, and transparency requirements concerning carbon risk on the other hand would allow informed investment decisions and help ensure an efficient and smooth low-carbon transition.”
At the report launch on 6 October 2016, the IDB also launched NDC Invest, a one-stop shop for countries to transform their national commitments into investment plans.
A Good Look At How Homes Will Become More Energy Efficient Soon
Everyone always talks about ways they can save energy at home, but the tactics are old school. They’re only tweaking the way they do things at the moment. Sealing holes in your home isn’t exactly the next scientific breakthrough we’ve been waiting for.
There is some good news because technology is progressing quickly. Some tactics might not be brand new, but they’re becoming more popular. Here are a few things you should expect to see in homes all around the country within a few years.
1. The Rise Of Smart Windows
When you look at a window right now it’s just a pane of glass. In the future they’ll be controlled by microprocessors and sensors. They’ll change depending on the specific weather conditions directly outside.
If the sun disappears the shade will automatically adjust to let in more light. The exact opposite will happen when it’s sunny. These energy efficient windows will save everyone a huge amount of money.
2. A Better Way To Cool Roofs
If you wanted to cool a roof down today you would coat it with a material full of specialized pigments. This would allow roofs to deflect the sun and they’d absorb less heat in the process too.
Soon we’ll see the same thing being done, but it will be four times more effective. Roofs will never get too hot again. Anyone with a large roof is going to see a sharp decrease in their energy bills.
3. Low-E Windows Taking Over
It’s a mystery why these aren’t already extremely popular, but things are starting to change. Read low-E window replacement reviews and you’ll see everyone loves them because they’re extremely effective.
They’ll keep heat outside in summer or inside in winter. People don’t even have to buy new windows to enjoy the technology. All they’ll need is a low-E film to place over their current ones.
4. Magnets Will Cool Fridges
Refrigerators haven’t changed much in a very long time. They’re still using a vapor compression process that wastes energy while harming the environment. It won’t be long until they’ll be cooled using magnets instead.
The magnetocaloric effect is going to revolutionize cold food storage. The fluid these fridges are going to use will be water-based, which means the environment can rest easy and energy bills will drop.
5. Improving Our Current LEDs
Everyone who spent a lot of money on energy must have been very happy when LEDs became mainstream. Incandescent light bulbs belong in museums today because the new tech cut costs by up to 85 percent.
That doesn’t mean someone isn’t always trying to improve on an already great invention. The amount of lumens LEDs produce per watt isn’t great, but we’ve already found a way to increase it by 25 percent.
Maybe Homes Will Look Different Too
Do you think we’ll come up with new styles of homes that will take off? Surely it’s not out of the question. Everything inside homes seems to be changing for the better with each passing year. It’s going to continue doing so thanks to amazing inventors.
ShutterStock – Stock photo ID: 613912244
IEMA Urge Government’s Industrial Strategy Skills Overhaul To Adopt A “Long View Approach”
IEMA, in response to the launch of the Government’s Industrial Strategy Green Paper, have welcomed the focus on technical skills and education to boost “competence and capability” of tomorrow’s workforce.
Policy experts at the world’s leading professional association of Environment and Sustainability professionals has today welcomed Prime Minister Teresa May’s confirmation that an overhaul of technical education and skills will form a central part of the Plan for Britain – but warns the strategy must be one for the long term.
Martin Baxter, Chief Policy Advisor at IEMA said this morning that the approach and predicted investment in building a stronger technical skills portfolio to boost the UK’s productivity and economic resilience is positive, and presents an opportunity to drive the UK’s skills profile and commitment to sustainability outside of the EU.
Commenting on the launch of the Government’s Industrial Strategy Green Paper, Baxter said today:
“Government must use the Industrial Strategy as an opportunity to accelerate the UK’s transition to a low-carbon, resource efficient economy – one that is flexible and agile and which gives a progressive outlook for the UK’s future outside the EU.
We welcome the focus on skills and education, as it is vital that tomorrow’s workforce has the competence and capability to innovate and compete globally in high-value manufacturing and leading technology.
There is a real opportunity with the Industrial Strategy, and forthcoming 25 year Environment Plan and Carbon Emissions Reduction Plan, to set long-term economic and environmental outcomes which set the conditions to unlock investment, enhance natural capital and provide employment and export opportunities for UK business.
We will ensure that the Environment and Sustainability profession makes a positive contribution in responding to the Green Paper.”