The world’s rapidly growing urbanization helps lift global economic
growth, but it also generates most of the global energy demand which, at
present, is met mostly with fossil fuels.
Cities are responsible for 70 percent of global carbon emissions and are
especially vulnerable to climate change.
International organizations have started to warn that limiting global
warming won’t be an easy task and the world and its cities need to turn to
climate-friendly projects and industries if we were to curb the damages of
environmental pollution and climate change.
Cities can lead the way for global actions to mitigate climate change,
according to the International Finance Corporation (IFC), a member of the
World Bank Group and the largest global development institution focused on
the private sector in emerging markets.
The fast-growing cities in emerging markets represent a huge investment
opportunity for green initiatives and industries—from renewable energy and
electric vehicles (EVs) to green buildings and public transportation and
climate-smart water and waste solutions, the IFC says.
The six key areas of green investments—EVs, renewables, waste, water,
green buildings, and public transportation—in the world’s emerging cities
could attract US$29.4 trillion in investments by 2030, a new IFC report
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Currently, more than half of the world’s population lives in cities, and
this share is expected to jump to 70 percent by 2050. Cities generate 80
percent of the world’s gross domestic product (GDP), but they also account
for two thirds of the world’s energy demand and 70 percent of global carbon
emissions, the IFC has estimated.
As much as 60 percent of the world’s area expected to be considered
‘urban’ by 2030 has yet to be built, so climate-friendly considerations must
play a major role in planning in the next few decades, according to the
IFC.
The institution has calculated that the investment potential in EVs is
US$1.6 trillion to 2030, waste solutions could attract US$200 billion,
renewable energy US$842 billion, public transportation US$1 trillion,
climate-smart water US$1 trillion, and green buildings as much as US$24.7
trillion, for a total global of US$29.4 trillion over the next 12 years.
Of course, city budgets alone will not be capable of financing projects at
such an enormous scale and amount, so the private sector, public-private
partnerships (PPPs), and green bonds must also be used to finance
climate-friendly initiatives, the IFC noted in its report.
The world needs such initiatives, especially in the light of the latest UN
report which showed last week that global carbon dioxide (CO2) emissions increased again in 2017
after a three-year hiatus.
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“The science is clear; for all the ambitious climate action we’ve seen –
governments need to move faster and with greater urgency. We’re feeding this
fire while the means to extinguish it are within reach,” said the United
Nations Environment Programme’s (UNEP) Deputy Executive Director Joyce
Msuya.
Cities around the world have started to commit to more actions to mitigate
climate change. For example, 26 major cities around the world—including
Paris, London, Los Angeles, Copenhagen, Barcelona, Vancouver, Seattle, Mexico
City, Auckland, Milan, Rome, Oslo, Oxford, Rotterdam, Santa Monica, Seoul,
and Tokyo—have pledged
to procure only zero-emission buses from 2025 and ensure that major areas of
their city are zero emission by 2030.
This could be a huge opportunity for electric buses makers and for
zero-emission vehicle manufacturers to continue working to bring battery
costs down to internal combustion engine (ICE) parity.
If cities around the world adopt the right policies to attract investment
and private partnerships, urban centers can lead the way to industry-wide
transitions to limit global warming.
By Tsvetana Paraskova for Oilprice.com
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