How to finance the net-zero transition of industry in emerging economies?

by Joseph Cordonnier and Deger Saygin, OECD Environment Directorate

Although policy makers and industry acknowledge the urgency of action for the net-zero industry transition in emerging and developing economies, the investment challenge remains significant.

The manufacturing industry serves society with a variety materials and products essential for economic activity and sustainable development. As this sector is responsible for 40% of global carbon dioxide emissions, the role of industry will be critical in reaching net-zero emissions by mid-century and to achieve the goals of the Paris Agreement. International fora such as the G7 and the G20, as well as numerous new public- and private-led initiatives, have also launched dedicated programmes to support dialogue to identify and propose solutions for the decarbonisation of industry.

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Solving global environmental emergencies: are financial actors playing their part?

by Valentina Bellesi and Hugh Miller, OECD Environment Directorate

After a summer of record-breaking temperatures, droughts, wildfires and floods causing devastation across the globe, the need to rapidly scale-up finance and investment to support a low-emission and climate-resilient transition could not be more apparent.

Limiting global warming to around 1.5°C above pre-industrial times requires global greenhouse gas emissions (GHG) to peak before 2025 at the latest. In other words, emissions trajectories in all sectors need to radically shift in the next three years. This means a radical shift in finance. Financial institutions representing 40% of global private financial assets have committed to reach net zero by 2050. However, there are significant gaps between financial actors’ net-zero commitments and the emissions of their portfolios.

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Seeing the Unseen: The Value of Water

by Aude Farnault and Xavier Leflaive, Water Team, OECD Environment Directorate

Credit: Noah Silliman (Unsplash)

Although extreme heat, droughts, and floods have been recurrent in recent years, weather patterns this summer have reached unprecedented limits: the continuation of catastrophic drought in Western States in the United States and in East Africa, record low levels of water in Europe, and catastrophic floods in Pakistan. This week, the 2022 Stockholm World Water Week took place in this very critical context, with a particularly timely theme: “Seeing the Unseen: The Value of Water”.

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Feux de forêt en Europe : Vont-ils devenir la norme ? 

Ce blog a été initialement publié le 22 juillet 2022 sur la page Linkedin OECD Environment ainsi que sur notre blog Environment Focus. Les données ont été mises à jour pour refléter l’évolution de la situation.

Catherine Desiree GamperÁgnes Szuda et Giulia Bonazzi, Direction de l’environnement de l’OCDE  

Crédit: Adobe stock images

Alors que l’Europe bat des records de températures, elle est aussi en proie à de violents feux de forêt. En France, la Gironde a vu partir en fumée plus de 20 800 hectares en juillet, et plus de 36 000 personnes ont dû être évacuées de leur domicile ou de leur lieu de vacances. Des feux massifs ont ensuite à nouveau repris en août en Gironde et dans les Landes. Dans tout l’Hexagone, de nombreux feux ont fait rage pendant l’été, de la Bretagne à la région Grand Est en passant par l’Occitanie. 

En Espagne, plus d’une vingtaine de feux de forêt estivaux étaient hors de contrôle d’après les autorités, tandis qu’au Portugal, de très importants dégâts ont été signalés – y compris aux habitations – dans le Nord, le Centre et l’Algarve. Même les pays d’Europe du Nord ne sont pas épargnés cette année, car à l’hiver sec a succédé un été plus sec encore et les températures s’emballent sur tout le continent.  

Les incendies surviennent naturellement dans beaucoup d’écosystèmes et peuvent être bénéfiques dans certains cas. Il n’en est pas de même des incendies extrêmes qui causent des dommages irréversibles à certaines espèces, à leur habitat et aux services écosystémiques – au point de laisser derrière eux des terrains où la forêt ne repartira pas et qui seront gagnés par la désertification. Ces incendies sont difficiles à éteindre et compliquent beaucoup la protection des personnes, des habitations, des entreprises et des infrastructures.  

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Wildfires in Europe: towards a “new normal”?

This blog was originally posted on 22 July 2022 on the OECD Environment Linkedin page.

by Catherine Desiree GamperÁgnes Szuda and Giulia Bonazzi, OECD Environment Directorate

Credit: Adobe stock images

Amidst record-breaking temperatures, wildfires have been raging across Europe. France’s Gironde region has already seen 19,000 hectares of forest destroyed and 34,000 people evacuated from their homes and holiday resorts.

Simultaneously Spanish authorities have reported over 20 wildfires that are out of control across the country, while Portugal is reporting major damage, including to homes, in the country’s north, centre and Algarve regions. Even northern European countries may not be spared from fires this year, after a dry winter, and even drier summer and soaring temperatures across the continent.

Wildfires are a natural component of many ecosystems and can deliver positive benefits in certain cases. This is different for extreme fires, which cause irreversible damage to certain species, their habitats and ecosystem services – to the point where desertification will follow as opposed to natural reforestation. Extreme fires are hard to suppress and make it challenging to protect people, homes, businesses and infrastructure assets.

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Limiting environmental impacts through unused or expired medicine

By Frithjof Laubinger, Environmental Economist, OECD Environment Directorate

Credit: Yulia YasPe/Shutterstock

Pharmaceuticals are widely considered as essential for maintaining human and animal health, but many of us do not consider their impact beyond treating infections and disease. In fact, residues from medicine can become an environmental concern when they enter the environment. This can happen in a myriad of ways – not just from improperly discarded unused or expired medicine, but also after they are consumed and excreted. While it is hard to address the latter, the former is more straightforward.

Flushing antibiotics down the toilet or pouring unused liquid medicine into the sink leads to leakage into freshwater systems. Alarmingly, most conventional wastewater treatment plants are not designed to remove these pharmaceutical residues. Medicines thrown away amongst residual household waste can also enter the environment when this waste is landfilled.

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Enabling conditions for bioenergy finance and investment in Colombia

By Lylah Davies, John Dulac, OECD Environment Directorate

Credit: Jeff Kraft/Shutterstock

With sunny skies, windy shores and fertile grounds, Colombia is abundant in natural resources and has substantial potential for renewable energy production. At the same time, domestic oil and gas reserves are in decline and the effects of climate change increasingly impact hydropower installations. Clean energy solutions like solar and wind power can therefore increase Colombia’s capacity to ensure secure, reliable and affordable energy.

The Government of Colombia has committed to diversifying the country’s energy mix and delivering on ambitious climate targets. This can been seen through recent legislation such as the Renewable Energy Law of 2014 and the Energy Transition Law of 2021, which prioritised the use of renewable energy technologies and provided various fiscal incentives. Notable progress includes Colombia’s first renewable energy auctions in 2019 and again in 2021, which enabled project developers to secure long-term supply contracts, attracting considerable investment in new solar and wind projects.

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Norway’s environmental performance: “Are we as green as we think we are?”

by Julia Wanjiru Nikiema, OECD Environment Directorate

Credit: VladOrlov/Shutterstock

“We, Norwegians, are we really as green as we think we are? Do we live up to the national and international environmental commitments we made?” some Norwegian stakeholders wondered. This has been the starting point of the OECD Environmental Performance Review of Norway launched today in Oslo, which provides some answers to these questions. The review examines Norway’s environmental performance over the past decade and how it compares with other countries, offering insights and lessons for other OECD members and partner countries.

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Recovering from the pandemic while facing the climate and energy crisis

By Enrico Botta, OECD Environment Directorate

Credit: Metamorworks/Shutterstock

The energy crisis triggered by the war in Ukraine has further exposed the risk posed by dependence on fossil fuels and an undiversified energy mix. While a number of OECD countries use renewable energy to meet around a third of their power demand, the overall role of fossil fuels in the total energy supply remains elevated at around 80% on average.  This leaves many OECD countries highly exposed to geopolitical and market volatility.

Following the invasion of Ukraine, the shock to oil and gas prices has been remarkable in countries that are particularly dependent on Russian oil and gas. In Europe, gas prices reached levels 10 times higher than a year ago, and the price of oil has almost doubled.

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The road to a sustainable tomorrow: Tracking a COVID-19 gender-sensitive and green recovery

By OECD (Sigita Strumskyte, Co-ordinator for SDGs and Gender, Environment Directorate; Dimitra Xynou, Policy Analyst, Environment Directorate), UNDP (Esuna Dugarova, Gender Specialist; Verania Chao, Programme Specialist, Climate Gender and Inclusion; Brianna Howell, COVID-19 Global Gender Response Tracker Analyst) and UN Women (Silke Staab, Research Specialist; Constanza Tabbush, Research Specialist)

Credit: StunningArt/Shutterstock

This year’s International Women’s Day theme “Gender equality today for a sustainable tomorrow”, puts a spotlight on the role of women and girls in the fight against climate change. Yet International Women’s Day takes place again in the midst of the COVID-19 pandemic. The feminisation of poverty keeps growing, the climate emergency is worsening, conflicts and violence are raging, and the international immunisation effort is not moving fast enough.  

In the context of the global pandemic, emergency government measures and stimulus packages have played a key role in supporting households and businesses throughout the pandemic, but have largely failed women. At the same time, environmental crises loom in the backdrop. As countries work to recover from COVID-19, governments have a unique opportunity to take steps towards gender-equitable, greener and fairer societies, a goal that was embraced by most in the early days of the pandemic.

To make this a reality, we must shift fiscal and other support to productive investments and sustainable consumption and production patterns that promote gender equality and strengthen inclusive and sustainable growth. It is also imperative to align policy measures with the Sustainable Development Goals (SDGs) and the 2050 net zero emissions goal that many countries have committed to. Putting the rights of women and girls at the centre of transitions to green economies provides an opportunity to address underlying inequalities and secure a more equal and sustainable future for all.

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