The SDG Knowledge Hub of the International Institute for Sustainable Development (IISD) provides the July update on global developments in climate finance for mitigation.
Climate Mitigation Finance Update: Investments Scale Solar Capacity, Improve Energy Efficiency and Accelerate REDD+
Recent solar energy investments include finance for off-grid solar energy in Kenya, 500MW large-scale solar plants in Egypt and a tool to chart solar energy potential in Pacific Islands. In addition, three energy efficient kindergartens and a modernized district heating facility were launched in Kazakhstan, while China and Kenya, among others, are seeing the environmental and socio-economic benefits of land-use and forest-related projects and partnerships.
Pacific Solar Energy Potential Mapped
The 26th Annual Conference of the Pacific Power Association, in Apia, Samoa, saw the launch of the ‘Global Solar Atlas,’ a mapping tool that will enable Pacific Islands to chart potential sites for renewable energy. The on-line tool produces detailed solar maps, yielding data such as the annual average solar power potential, and is expected to assist governments and investors to facilitate the adoption of solar power within Pacific Island countries. It is funded within the World Bank’s Energy Sector Management Assistance Program (ESMAP).
Off-grid Solar to Enable Energy Access for Marginalized Communities in Kenya
The World Bank has approved a US$150 million International Development Association (IDA) credit to launch a project that will provide access to modern, off-grid solar energy services to isolated communities in Kenya. The credit will fund the ‘Off-grid Solar Access Project for Underserved Counties,’ which aims to provide energy access to 1.3 million people within 14 counties in Kenya, including 10 within the North Eastern Development Initiative (NEDI). A technical assistance component of the project will lead to a county-level capacity building program and a consumer education campaign that will foster greater citizen engagement. The project will contribute to achieving Kenya’s goal of universal electricity access by 2020.
US$660 Million Approved for 500MW of Solar Capacity Projects in Egypt
The International Finance Corporation (IFC) of the World Bank agreed to a US$660 million investment to enable 500MW of increased solar power capacity in the Benban solar complex in Egypt, which aims to become the world’s largest solar PV park. The Benban project will see total investments of US$730 million as part of Egypt’s innovative solar Feed-In Tariff (FIT) program. The project aims to reduce greenhouse gas emissions (GHG), foster economic growth, and bolster the local economy, including through creating temporary and long-term jobs in the construction, operation and maintenance of the plants.
Expected to tap into Egypt’s huge solar potential, the investment will finance 11 large-scale solar PV projects from public and private developers. The project will contribute to Egypt’s goal of installing 2 GW of large-scale solar capacity and its target to have 20% of national energy sourced from renewables by 2020.
Three Energy Efficient Kindergartens, District Heating Financed in Kazakhstan
As part of the World Bank’s four-year Kazakhstan Energy Efficiency Project, three energy efficient kindergartens have opened in Aktau, Kazakhstan, the first of their kind in the city. After initial energy audits to identify highly energy intensive units, the three kindergartens underwent efficiency retrofits including roof repairs and regulated heating installations, and received new windows, doors and lighting systems. The project, which has selected 44 public facilities to undergo energy efficiency retrofits since 2015, aims to cultivate a more enabling environment that will attract strategic investments in Kazakhstan’s energy efficiency sector. The three buildings in Aktau are among five kindergartens and a school that were selected to undergo work to improve their efficiency this year in the Mangistau region.
The project is financed by a trust fund grant of US$21.76 million from the Government of Switzerland and the Swiss Agency for Development and Cooperation, which is administered by the World Bank, and receives US$1.3 million in co-financing from the institutions participating in the project.
A project in Ust-Kamenogorsk, Kazakhstan will modernize the city’s district heating system to improve energy efficiency, reduce heat loss and optimize the system’s operations. Supported by the European Bank for Reconstruction and Development (EBRD), the modernization project is expected to bring substantial efficiency improvements to the city’s heating supply, while protecting consumers from extreme cold in the winter.
Since 2014, EBRD’s Enhanced Partnership Framework Arrangement with the government of Kazakhstan has enabled a substantial increase in public utilities investments, including modernization projects. The funding is the latest in a total of €7.3 billion the EBRD has invested in Kazakhstan, much of which focuses on non-oil and gas sectors.
Sustainable Agriculture and Land Management in Kenya
A 20-year project in Kenya to enable farmers to implement sustainable agriculture and land management has produced tangible benefits, including increased maize yields and sequestration of carbon. Supported by the World Bank’s BioCarbon Fund and Vi Agroforestry, Sweden, the project supports 60,000 farmers, managing a total of 45,000 hectares of land, to sustainably rehabilitate degraded farmlands. As well as increased productivity that has boosted farmers’ incomes, the project has also delivered climate mitigation benefits through sequestration of CO2 in trees and soil. According to the World Bank, it is the world’s first agricultural land management carbon project to issue Verified Carbon Standard emission reductions payments for the implementation of agricultural practices. To date, the BioCarbon Fund has purchased approximately US$580,000 of carbon credits from the project.
China Afforestation Project Sees Benefits for Environment and Farmers
A six-year World Bank-supported afforestation project in Shandong, China, has been completed. It planted trees in over 66,915 hectares of barren land and sequestrated the equivalent of 12 million metric tons of carbon dioxide (CO2). Located in the East China region, the US$162 million Shandong Ecological Afforestation Project increased forest cover in steep mountainous slopes and exposed saline coastal areas, typically challenging environments where few tree and shrub species survive.
Major project outcomes include increasing vegetation cover from 16% in 2010 to 90% in highly degraded hillsides of the region, and from 7% to 66% in saline coastal areas. The project also provided cost-benefit analysis data on carbon sequestration potentials of prospective project areas, which the World Bank expects to contribute to Shandong’s readiness to enter the Chinese carbon trading market. The project is also expected to generate incomes for 26,556 farming households, including through selling fruits, nuts and tea from commercial tree crops.
UNDP, Italy Partner on REDD+ implementation
A cost-sharing partnership between the UN Development Programme (UNDP) and the Ministry for the Environment, Land and Sea of the Republic of Italy will begin work on joint activities providing support to REDD+ at global, regional and national levels. The partnership aims to catalyze transformational REDD+ implementation, and will involve work in several geographic areas in which both organizations have existing operations. These include South America, West Africa and Asia-Pacific. Ecuador, Ghana and Myanmar are among the countries that will receive support through the Third Party Cost-Sharing Agreement between the two organizations. The overarching aim of the partnership is to enhance, strengthen and accelerate sustainable forest management, and REDD+ implementation and results, in the context of the Green Climate Fund (GCF), in particular.