WORKING TITLE: Development in a Changing Climate or A Changing Climate for Development

1. WORKING TITLE: Development in a Changing ClimateorA Changing Climate for Development World Development Report 2010

2. A call to action • Climate change is one of many challenges facing developing countries… • ..but unless it is tackled soon, it will reverse development gains and exacerbate inequalities. • “Climate-smart” development is needed and can be achieved. • Rich countries must take leadership on climate action now, but we can’t succeed without the active cooperation of middle-income countries.

3. The science is incredibly strong and verified Surface and tropospheric temperatures increasing Atmospheric water vapour increasing Ocean heat content increasing … … sea level rise directly linked and probably cyclone/hurricane intensity Glaciers and snow cover decreasing Greenland and Antarctic ice sheets losing mass with … … Arctic Sea ice extent decreasing—VERY RAPIDLY!!!! Area of seasonally frozen ground decreasing More intense and longer droughts Frequency of heavy precipitation events and floods increasing Extreme temperatures increasing Monsoon patterns changing Unequivocal Manning, IPCC, WGI, 2007

4. Why Climate Change is a Serious Development Issue All countries are vulnerable to climate change but the poorest countries and the poorest people within them are most vulnerable. They are the most exposed and have the least means to adapt. In this decade over 3 billion people in developing countries are likely to be affected by climate related disasters People in developing countries are affected at more than 20 times the rate of those in developed countries Source: World Bank analysis based on CREDA data.

5. Climate Change and the Bank

6. Climate Change and the Bank • Carbon Finance • Prototype Carbon Fund (PCF) in 1999 – capped at $180M • Now 10 funds and over $2 billion under management • Carbon Partnership Facility (CPF) – go programmatic • Engage both buyers & sellers – target $5 billion • Clean Energy Investment Framework (CEIF) • A call for the Bank’s engagement in three climate pillars • Energy Access • Clean Energy for Development • Climate Resilient Development (Adaptation)

7. Climate Change and the Bank • Forest Carbon Partnership Facility (FCPF) • Pilot REDD – c. $0.5 billion • IDA Replenishment • Argued that increased resources were need to move to climate resilient development • Accept that not all of these initiatives meet the demand that all funding come under the UNFCCC process

8. Climate Change and the Bank • Climate Investment Funds • Clean Technology Fund • c. $5 billion for transformational change in currently viable technologies • Strategic Climate Fund • Pilot Program for Climate Resilience – c. 0.5 billion • Forest initiative • Renewables initiative

9. Strategic Framework for Climate Change and Development (SFCCD) • The SFCCD is about development in the context of climate change • Priority of growth, poverty reduction and MDGs • Importance of meeting energy needs of developing countries • Role of development in helping to adapt to climate risks • Resource mobilization in addition to the current ODA levels

10. SFCCD Pillars • Make effective climate action – both adaptation and mitigation - part of core development efforts • Address the resource gap through existing and innovative instruments for concessional finance • Facilitate the development of innovative market mechanisms • Create enabling environment for and leveraging private sector finance • Accelerate the deployment of existing and development of new climate-friendly technologies • Step-up policy research, knowledge management and capacity building Sustainable Development @ The World Bank

11. Climate Change Matters for Development

13. Stabilizing CO2 concentrations means fundamental change to the global energy and land use systems. 13

14. Projected Impacts of Climate Change Stern, 2006

15. Climate change cannot be tackled without developing countries

16. Development matters to climate change • The past…rich countries responsible for about 60% of GHGs stocks • The future…half GHGs flows are now from middle-income countries and that share will grow. • Costs of controlling emissions rise if we delay; the sooner all countries participate, the lower the total costs

17. The basis for a global deal GHG stabilization costs for 550 ppm target, relative to ‘first best’

18. The precautionary principle • The case for (in)action is not just about discount rates… • Also about irreversibility, tipping points, extreme events and sustainable development • 50% chance of warming above 2oC even with concentrations at 450 ppm CO2e • Above 2oC, real danger of irreversible changes • Danger is real, particularly for poorer countries…

19. Objectives and Value Added of the WDR 2010

20. Objectives • Inform development policy: Climate change does represent a changing climate for development • Inform climate policy: Unless development realities are integrated into climate change agreements, such agreements will fail • Refocus the vision of sustainable development: Increase understanding of how development policy should be designed in a greenhouse world

21. Value added • Focus on development • Integrate adaptation and mitigation • Present evidence that the elements of a deal exist • Highlight development opportunities in the changing competitive landscape – and how to seize them

22. Proposed Outline

23. Part I. Climate-Smart Development Policy • The land and water challenge - Managing competing demands and creating new opportunities • The energy challenges - Managing competing objectives and creating a new comparative advantage • Managing human vulnerability - helping people help themselves

24. Where we are headed – crop yield by 2080

25. Agro-Economic Vulnerability to Future Climate Change

26. Water: More crop per drop" (E. Marris, 3-21-08) Nature, 2008

27. Emissions Mitigation Scenario Policy Scenario includes a cumulative reduction of emissions of 40% from 2012 to 2100, where limits on fossil fuel usage spurs biomass conversion. Page 27 Source: Gurgel et al. 2007

28. Part II. Development-Smart Climate Policy • An International Architecture for Climate change and Development • Harnessing Finance and Market Instruments for Mitigation and Adaptation • Harnessing Innovation and Technology Diffusion for Mitigation and Adaptation

29. Development public R&D expenditure (in OECD) in billion $ Source: Doornbosch, 2006

30. The near-term challenge of scale CO2 Storage—550 ppm Stabilization Case 30

31. The mid- and long-term the challenge CO2 Storage—550 ppm Stabilization Case 31

32. Cross cutting themes

33. Adaptation Anticipatory Reactive Natural Systems Private Human Systems Public Source: Based on Klein 1998: IPCC 2001

34. Anticipatory Reactive Natural Systems Private Human Systems Public Source: Based on Klein 1998: IPCC 2001

35. Adaptation and Surprise • Complex systems: inherently hard to predict • “Data sparse, theory limited, surprise normal” • Climate change will interact with multiple stressors in unexpected ways • Increasing global prosperity • Demographic and Public health challenges • Urbanization and Rural-urban migration • Coastal vulnerability (floods, storm surge, sea level)

36. Part III Achieving climate-smart decisions • Global problem, local action: effective national and community-level actions • Getting to decisions - Managing the politics and social-psychology of climate change • Getting to good decisions – institutions and information; Adaptive policies and governance • Recent “Climate Governance and Development Conference” in Berlin will be a key input

37. Characteristics of adaptive policies: - in-built adjustment mechanisms - interactive decision-making and learning - decentralized (subsidiarity) - encourage self-organization and networks - provision of review mechanisms

38. When two elephants fight… …it is the grass that gets hurt

39. Feedback Sought • Storyline & key messages • Doom & gloom or vision & opportunity • Climate change as an opportunity: REDD, land-based emissions • Bottom-up adaptation approaches; top-down incentives • Case studies – good and bad • HOW TO MAKE IT HAPPEN, AND IN TIME…. • Where “IT” is adequate, acceptable and achievable? • Can (should) the WDR be neutral to the negotiations?

40. Some other ‘food for thought’ • How can the emissions cuts be achieved while leaving space for development and time for technological and lifestyle changes? • Role of CDM • Global 2 tCO2/person cap and trading of these rights • Should we keep working for a 450ppm stabilisation (2ºC) while also preparing for a 550+ppm (3 to 4ºC)?

41. Some other ‘food for thought’ • Can a momentum for change be sustained in the face of other pressures (e.g. food and finance crises) • If there are so many win-wins out there for climate change and development, why haven’t they been taken up already?

42. Some other ‘food for thought’ • What is the best role for the WDR with respect to the UNFCCC process and Copenhagen? • What constitutes a fair outcome? • Natural debt of the North v financial debt of the South • Within nation equity • Is ‘Adequate, Achievable and Acceptable” a more pragmatic approach?

43. Thank you

44. Advisors • J. Schellnhuber (PIK) • N. Nakicenovic (IIASA) • JC. Hourcade (France) • G. Heal (Columbia) • J. Weyant (Stanford) • Zhou Dadi (China) • C. Nobre (Brazil) • C. Juma (Harvard) • N. Adger (East Anglia) • S. Huq (IIED) • J. Holdren (Harvard) • R. Watson (DEFRA, UK Govt)