EBRD to unveil ambitious plans for shift to green at COP27 Egypt
The European Bank for Reconstruction and Development (EBRD) is heading to the UN climate conference COP27 in Egypt on November 6-18, with ambitious plans to ratchet up its pioneering climate work across the regions where it works.
EBRD President Odile Renaud-Basso, will be leading the bank’s delegation to the climate summit in the Red Sea resort of Sharm El-Sheikh.
In cooperation with other multilateral development banks (MDBs), the EBRD is exerting key efforts to help decarbonise economies and enable the transition to a more sustainable future, with a focus on involving the private sector in tackling climate change.
The bank, which operates across three continents – in central and eastern Europe, Central Asia, and the southern and eastern Mediterranean (SEMED) – aims to instill confidence in the green transition and enthusiasm for the opportunities it offers, it added in a statement on Thursday.
“We want to generate confidence in our countries of operation so that they can have big ambitions for their low carbon pathways. However increasingly ambitious they get, they will be able to count on EBRD unwavering support and finance.” Odile Renaud-Basso said.
“The low carbon transition is an economic and social opportunity, not simply a cost to be borne. A low carbon economy has cleaner air and water, and cheaper, more secure and less volatile energy. It also presents big new opportunities for employment and economic growth, whether in minerals, clean fuels or new products.” she added.
In COP26 in Glasgow last year, Scotland represented a step change in the global level of ambition. Major economies have committed to reach the goal of net zero emissions by mid-century – some 90 percent of global emissions are now covered by such commitments – and Glasgow witnessed growing engagement from the private sector, vital to boost investments to levels needed to reach the Paris Agreement temperature goals.
With climate change hitting hard, notably in the developing world, finance for climate adaptation will be high on the November agenda, particularly since this is a COP (Conference of the Parties) on the African continent. Another priority will be delivery on pledges made to date, the bank noted.
“This is a particularly important COP for the EBRD, since it is held in one of its biggest countries of operations. Senior representatives of the Bank – including President Renaud-Basso and First Vice-President Jürgen Rigterink – will participate in over 100 events.” the bank statement further said.
EBRD work will be grouped around four themes following COP27 priorities: supporting Egypt to accelerate its green energy transition; increasing finance and support for climate adaptation and resilience; expanding private sector climate mobilisation; and supporting corporate transformation.
The EBRD will support Egypt in the coordination of the energy pillar of its planned Nexus Water-Food-Energy initiative, which will be launched at COP27. Egypt has huge renewable energy resources and is close to markets in Europe and Asia, giving it the potential to be a global hub for green fuels and products. The country also aims to increase the share of renewable energy in its electricity mix to 42 percent by 2035.
The energy component of this plan will comprise retiring 5 GW of inefficient fossil fuel capacity by 2025 and deploying 10 GW of solar and wind energy by 2028. Using $500 million of technical assistance, grants, and loans to carry out a just transition and support for absorption of renewable capacity, NWFE-EP is set to mobilise $10 billion in private investments.
“The EBRD is ready to support its countries of operation in replicating similarly ambitious transition platforms in the energy and other high-carbon sectors,” said Harry Boyd-Carpenter, EBRD’s managing director for climate strategy and delivery.
The EBRD’s work on systemic reform to improve the environment for green investment is helping encourage the private-sector investors who hold the key to the trillions in private investment needed to bring about a successful green economic transition.
As it pledged at COP26, the EBRD is on track to double its own mobilisation of private-sector climate finance by 2025. The bank is helping countries formulate climate strategies, supporting innovative financial instruments in capital markets, regulatory frameworks like renewable energy auctions, and the implementation of carbon pricing instruments.
As well as working with countries of operation on Nationally Determined Contributions and Long-Term Strategies, which send clear signals to corporations about their climate vision, the bank is increasing its work with corporates on transforming their understanding of climate risks and opportunities.
For financial institutions, corporate and municipal clients, the EBRD is launching a Corporate Climate Governance (CCG) programme to help clients assess, manage, and incorporate climate information into their governance, strategy and risk management structures.
In 2021, developed countries pledged at Glasgow to at least double the 2019 climate adaptation finance of $20 billion to developing countries by 2025. The EBRD will set out how it will play its part in boosting both the finance and the policy support it will provide to help its countries of operations adapt to climate resilience, including launching an EBRD Climate Adaptation Action Plan at COP27.
The EBRD chairs the climate heads’ group of MDBs which work together to publish an annual Joint MDB Climate Finance Report. The latest report unveiled record levels of climate finance in 2021. One key aim at COP27 is to highlight progress towards aligning all MDB work with the goals of the Paris Agreement.
The bank, among the first, plans to be fully Paris aligned by 1 January 2023. It has also pledged to make at least 50 percent of its investments green by 2025.
