Event recap
On July 8th, the The World Bank Group (WBG), the International Institute of Green Finance (IIGF), Carbon Pricing Leadership Coalition (CPLC), and Partnership for Carbon Accounting Financials (PCAF) jointly organized the Official Side Event of the UNFCCC Asia-Pacific Climate Week 2021. The online meeting brought international and domestic experts from government, financial institutions, international organizations, and academia to exchange views on the role of carbon pricing and GHG accounting strategies in accelerating carbon neutrality in China.
In the opening remarks, Professor Wang Yao, Director General of the IIGF underlined the effectiveness of carbon pricing and emission rights trading in reducing carbon emissions.
Daniel Mira Salama Mira-Salama, Senior Environmental Expert from the World Bank, outlined that World Bank’s new Climate Change Action Plan (2021-2025) increases the climate financing target from 28% to 35%. He noted that an increasing number of public and private players promote the decarbonization strategies through international cooperation.
Giel Linthorst, Executive Director of the PCAF, focused on the importance of introducing standardized greenhouse gas (GHG) accounting strategies to help financial institutions measure and manage the climate risks of their investment portfolios.
In the keynote speech, Ye Yanfei, Director General of the Policy Research Bureau of the China Banking and Insurance Regulatory Commission said that carbon pricing can effectively guide the market behavior of investors and FIs to transition to green and sustainable development. The development of effective carbon pricing will encourage low-carbon technological innovation of enterprises achieving carbon-neutral goals. Additionally funds collected through the carbon market can increase investment in carbon sink projects.
During first roundtable, LI Jin (Shanghai Environmental Rights and Energy Exchange Centre), Dimitri de Boer (Client Earth) SHAO Shiyang (Gulian Capital), Alistair Ritchie (Asia-Pacific Sustainability) and SHI Yichen (IIGF) discussed the global development of carbon pricing and other financial instruments that support decarbonization. They exchanged views on the carbon market as well as opportunities and challenges that China will face after the launch of the national carbon market. Wu Jichong, from the World Bank, presided over the discussion.
During the second roundtable chaired by Ola Janus from the IIGF with the participation of ZHANG Yongmiao (Huaxia Bank), FAN Binbin (Bank of China), Jiangxi Bank, Giel Linthorst (PCAF), and Chenguang Zhao (CDP) discussion focused on role of measuring financed emissions. Experts shared the latest progress of Chinese banks in greenhouse gas emissions accounting and environmental information disclosure in the context of China’s neutrality goals and outlined the existing challenges and future trends in this area.
Background
As one of the world’s fastest-growing economies, the levels of emission reductions and removals needed to reach China’s carbon peak and neutrality targets will require a fundamental transformation in its energy and industrial systems. Carbon pricing, as one of the most effective policy approaches, and can play an important role in incentivizing low-carbon action by internalizing the cost of greenhouse gas emissions. What are the challenges of transitioning to low- and zero-carbon development for the power sector in China? What is the role of carbon pricing in incentivizing sectoral transformations and aligning investments to drive decarbonization technology breakthroughs? How can financial institutions better support industries in reaching carbon-neutrality goals? This meeting will aim to address these questions.
As globally, growing numbers of financial institutions are committing to delivering net-zero financed emissions, and banks increasingly opt to include climate risks in their portfolio management and financing decisions, in the second part of the event, experts will explore how measuring and disclosing financed emissions could facilitate financial institutions to more effectively support the decarbonization of hard-to-abate sectors.
In partnership with the International Institute of Green Finance (IIGF) and the Partnership for Carbon Accounting Financials (PCAF), the Carbon Pricing Leadership Coalition (CPLC) and the World Bank are convening a virtual workshop – an official side event of APCW2021 of UNFCCC to discuss these issues. The event’s goal is to bring together policy experts and corporate management from China and the world to have a peer-to-peer dialogue on the role of carbon pricing in helping the hard-to-abate sector companies achieve their climate targets.