Happy Earth Day, folks. We need to take care of this marble.
Follow me below the fold for some ideas on how to do that:
On January 27th, President Biden issued this expansive Executive Order tackling climate change. Here are some excerpts:
The United States will reconvene the Major Economies Forum on Energy and Climate, beginning with the Leaders’ Climate Summit (happening right now). In cooperation with the members of that Forum, as well as with other partners as appropriate, the United States will pursue green recovery efforts, initiatives to advance the clean energy transition, sectoral decarbonization, and alignment of financial flows with the objectives of the Paris Agreement, including with respect to coal financing, nature-based solutions, and solutions to other climate-related challenges.
The United States will immediately begin the process of developing its nationally determined contribution under the Paris Agreement. The process will include analysis and input from relevant executive departments and agencies (agencies), as well as appropriate outreach to domestic stakeholders. The United States will aim to submit its nationally determined contribution in advance of the Leaders’ Climate Summit.
The United States will also immediately begin to develop a climate finance plan, making strategic use of multilateral and bilateral channels and institutions, to assist developing countries in implementing ambitious emissions reduction measures, protecting critical ecosystems, building resilience against the impacts of climate change, and promoting the flow of capital toward climate-aligned investments and away from high-carbon investments. The Secretary of State and the Secretary of the Treasury, in coordination with the Special Presidential Envoy for Climate, shall lead a process to develop this plan, with the participation of the Administrator of the United States Agency for International Development (USAID), the Chief Executive Officer of the United States International Development Finance Corporation (DFC), the Chief Executive Officer of the Millennium Challenge Corporation, the Director of the United States Trade and Development Agency, the Director of the Office of Management and Budget, and the head of any other agency providing foreign assistance and development financing, as appropriate. The Secretary of State and the Secretary of the Treasury shall submit the plan to the President, through the Assistant to the President for National Security Affairs and the Assistant to the President for Economic Policy, within 90 days of the date of this order.
After reading yesterday's Coal Ash diary, you should understand just how critical that third part is. Global lending institutions are hesitant to invest in new coal plants (as well they should be), and this is a perfect opportunity to not only offer alternatives, but to provide the needed funding for them. The United Nations has been working on this for several years, but the progress has been limited:
SE4All’s Finance Committee has made it clear that the current pace of investment in sustainable energy is not sufficient to meet the SE4ALL goals by 2030. Investment in clean energy needs to nearly triple from the current US $400 billion a year to more than US $1 trillion a year.
We believe that this level of private capital is available, but investors tend to be wary to enter new markets that they regard as risky. That's where development partners like the World Bank are making a difference. Working closely with Governments, we are helping reduce risk and build strong, reliable energy institutions. It also means laying out energy-investment prospectuses to attract private capital and identifying a range of financial instruments, such as guarantees, that give investors the confidence they need. In Myanmar, for example, we have been part of a broad effort with a host of other development partners to get the US $700 million National Electrification Plan off the ground. Another World Bank Group initiative, Scaling Solar, is helping countries in sub-Saharan Africa develop utility-scale solar power inexpensively and quickly—in as little as two years—through a "one-stop shop" of advisory and financial services.
Bolding mine, because that is a huge understatement. Here in the U.S., we have a pretty strong financial motive for constructing renewable energy, thanks in a large part to various states' renewable energy portfolio standards (REPS), including NC. Either generate the electricity or purchase credits from other states, a formula which has supercharged the construction of solar and wind capacity. Unfortunately, that system doesn't exist in most other countries, especially developing ones. Combine that with political instability, and the will to invest large sums is simply not there.
But if the U.S. and other relatively wealthy developed nations could provide some guarantees, whether it's underwriting those potential loans or some other financial mechanism, the potential is huge.