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SUMMIT IMPLEMENTATION REVIEW GROUP (SIRG) First Regular Meeting of 2009 January 12-16, 2009 (Working Group Sessions) January 14-16, 2009 (Plenary Sessions) Padilha Vidal Room– 1889 F Street NW, DC 20006 Washington, D.C. PRESENTATION ON ENVIRONMENTAL SUSTAINABILITY THE WORLD BANK OEA/Ser.E GRIC/O.1/doc.5/09 14 January 2009 Original: English Low Carbon, High Growth: Latin American Responses to Climate Change January 14, 2009 Outline Consequences of climate change are already with us Significant risks of severe impacts in the future Why LAC should be part of the solution LAC has already made important contributions Priorities for LAC to become a bigger part of the solution International pre-conditions for LAC to play its role Summary of main findings 3 Significant climate change impacts on LAC are already observable Melting of Andean glaciers Caribbean corals are bleaching and dying 30% have already died since 1980s; they could all be dead by 2060 Large impact on biodiversity, fisheries, tourism, coastal protection Increased risk of natural disasters Most low altitude glaciers will disappear within next 20 years Severe impact on unique ecosystems (drying of páramos) and water supply Tenfold increase in hurricane damages in Mexico by 2025; three to fourfold increases in other Caribbean countries Climate-related natural disasters (storms, droughts and floods) cost, on average, 0.6 percent of GDP in affected countries Increased mortality & morbidity from tropical diseases, for example dengue and malaria From 400 to 800 cases of malaria/100,000 in Colombia (70s vs. 90s) 4 Threat of even more severe damages during the 21st century Warming threatens LAC’s rich biodiversity Amazon rainforest could shrink by 20–80% for 2-3oC warming A possible 50% reduction in rainfall could trigger “savannization” Impact on biodiversity and rainfall of whole hemisphere Some areas may face collapse in agricultural productivity Mexico, for example, could lose up to 26% of mammals by 2050 Reductions of 12% to 50% by 2100 in South America Mexico: total loss of economic productivity in 30- 85% of farms (2100) With impacts on world food supply (LAC is 12% of world exports) Increase in the number of people under water stress by 6 to 20 million by 2055 Small islands in the Caribbean can suffer from multiple impacts Natural disasters, sea level rise, agriculture yields, loss of corals, etc. Losses could reach 7 to 18% of GDP by 2080 5 LAC should be part of the solution: to ensure global effectiveness and efficiency Effectiveness: to keep warming under 3oC, for example… Even if rich countries reduce their GHG emissions to zero… Up to 28% reduction in the per capita emissions of developing countries will still be needed by 2050 Efficiency also requires developing country participation Explore low cost mitigation options first More than 50% of the options for emission reductions at carbon prices under US$100/tCO2e are in developing countries Almost 70% in industry, agriculture, forestry Source: Stockholm Environment Institute (2007) and IPCC (2008). 6 To some extent LAC has already been part of the solution… LAC’s energy emissions are well below the world’s average both in per capita terms and as fraction of the region’s GDP But, with business as usual, LAC is projected to shift to a higher carbon growth path And although this is not necessarily surprising, beyond energy LAC emissions are higher than usually thought Emissions from land use change Non-CO2 emissions, mainly from agriculture 7 LAC’s low carbon growth: emissions intensity of energy is well below the world’s average Carbon Intensity of Power (Mt CO2/Mtoe), 2005 7.0 6.0 Energy-related emissions 5.0 are 60% of global GHG LAC is 6% of global energy-related emissions 4.0 5.8 3.1 3.0 2.4 2.6 2.2 2.0 1.5 1.0 0.0 All Developing Transition OECD LAC China & India World Source: WB staff calculations with data from EIA (2008). Note: units in figure are tones of CO2 per tone of oil equivalent energy. 8 LAC’s energy-related emissions to grow faster than the world average after 2015 140.0% 120.0% Projected Growth in per capita CO2 Energy Emissions (2005-2015 and 2005-2030; business as usual) 2015 130.0% 2030 102.6% 100.0% 80.0% 59.1% 59.0% 60.0% 40.0% 40.0% 33.3% 31.8% 24.4% 20.0% 9.5% 14.6% 3.6% 5.5% 0.0% LAC OECD All Developing Source: WB staff calculations with data from EIA (2008). China India World 9 LAC emissions from land use change are understandably high Land use change (18 % of GHG) 53% LAC has over 30% of world forest biomass 22% -5% -1% 31% Low Income Middle income (excluding LAC, China & India) High Income LAC China & India Source: WB staff calculations with data from WRI (2008).. 10 LAC’s non-CO2 emissions are also high, driven mainly by agriculture… Other (23% of GHG) LAC has 12% of global agricultural 27% production, which is the source of most non-CO2 emissions 22% 13% 15% 22% Low Income Middle income (excluding LAC, China & India) High Income LAC China & India Source: WB staff calculations with data from WRI (2008).. 11 All things considered…LAC has 12% of global GHG emissions…(vs. 6% of energy) Total (100% of GHG) 26% 37% 9% 16% 12% Low Income Middle income (excluding LAC, China & India) High Income LAC China & India Source: WB staff calculations with data from WRI (2008).. 12 Priorities for LAC to be a bigger part of the solution, mostly with “no regrets” (I) Reduce emissions from deforestation Avoid “tragedy of the commons” by assigning clear land ownership or management responsibility Continue to take advantage of innovative financing instruments for forest conservation Avoid shift to “dirtier” energy sources, especially by taking advantage of low impact hydroelectricity Consider hydro in light of global benefits of emission reductions Make use of increased experience and better tools to avoid negative environmental and social impacts: e.g., strategic impact assessments Intensify efforts to exploit other sources of renewable energy (e.g. wind) Continue to take advantage of low cost and sustainable biofuels (taking into account direct and indirect land use change effects) 13 Priorities for LAC to be a bigger part of the solution, mostly with “no regrets” (II) Improve energy efficiency Promote efficiency labeling, standards, information programs Reduce level and improve targeting of fossil fuel subsidies Design incentives for energy saving technologies, e.g., co-generation Improve energy efficiency in the public sector Transform urban transport with integrated policy approach Integrate policies for transport sector with urban planning Increase attractiveness of public and non-motorized transport relative to private automobiles For example, through fostering dense urban development along main public transport corridors For ex., Bus Rapid and Rail Based transit systems, inter-modal integration Improve fuel efficiency in private, public and freight transport For ex., through new efficiency standards, low-carbon fuels, and programs to improve fleet maintenance and driver behavior 14 Adaptation will still be inevitable given inertia of climate system Many adaptation priorities are also “no-regrets”: increasing resiliency, flexibility and mobility of households also promotes growth and poverty reduction Enhancing weather monitoring/forecasting improves risk management Improving social protection programs can specifically help protect against weather shocks while providing general income support to poor households Improving land and water markets will be necessary to use these resources better, but is also good development policy Some of LAC’s adaptation responses will take new investments to: Maintain and protect ecosystems Mitigate the effect of, and recover from natural disasters Capture and store water, control floods Strengthen public health systems Continue evolution of agricultural research and extension 15 To play its role in reducing emissions, LAC needs the right international CC architecture Equity issues: no global deal without addressing them… Full participation by high-income countries essential To establish leadership and perception of equity To generate market for low-carbon technologies To finance low carbon technology development and transfer A LAC friendly architecture would... Fully incorporate emissions reductions from avoided deforestation and land degradation Be friendly to development of sustainable hydropower Have no or low trade barriers to sustainable biofuels Expand carbon finance beyond project based CDM 16 Summary of Main Findings • Negative climate change impacts are already observable in LAC and will become much more severe during the 21st century • LAC is a small part of the problem: very low energy-related GHG emissions, one third of the world’s forest biomass • LAC can be an important part of the solution: keeping its energy matrix clean, avoiding deforestation, pursuing low carbon growth • Many of the domestic policy actions needed for LAC to adapt to and mitigate climate change are good for development (“no regrets“) • But for LAC to make a significant global contribution, a strong leadership by high income countries will be needed… • Together with international support for climate-friendly policies in areas of LAC comparative advantage (forestry, hydros, biofuels) 17 END