FEATURING

Andrew Steer President and CEO, WRI

(Photo: jdlasica/Flickr)

It’s been a great two decades . . .

↑100% real per capita income in developing countries

2 billion gained access to improved drinking water

↓50% people living on less than $1.25 per day

↓47% maternal deaths

↑58% girls enrolled in primary education in least developed countries

(United Nations, World Bank, 2012)

. . . Or has it?

3.3 million deaths per year from air pollution

13 million hectares of forest lost per year

↑2.9x cement production

↑50% CO2 emissions

(WHO, The Lancet, EU, US DOE, FAO)

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Car

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1900 1920 1940 1960 1980 2000

Car

bon

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ide

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(US DOE, 2010; EU, 2012)

35 BILLION TONS (2012)

6 BILLION TONS (1950)

GLOBAL CO2 EMISSIONS ON THE RISE

3% (1800)

70% (2050)

50% (2000)

30% (1950)

14% (1900)

SHIFT TO AN URBANIZED WORLD

(UN DESA, 2012)

EXPLOSION OF THE GLOBAL MIDDLE CLASS

1 billion in 1990 2 billion in 2010 5 billion by 2030

(Photo: ben124/Flickr)

(WRI chart using World Bank data, 2012)

ARE WE RUNNING OUT? Price trends of major commodity bundles (real 2005 dollars)

Pric

e in

real

200

5 do

llars

250

200

150

100

50

1960 1970 1980 1990 2000 2010

Food Energy Timber Fertilizers Metals and Minerals

(Photo: MC-Leprosy/Flickr)

ENERGY MIX 1

1 WHAT ENERGY MIX? 1.3 billion people without access to electricity

(Photo: Martini DK/Flickr)

55+ U.S. coal plants shut down in 2012; 395 remain

COAL

4

5

6

7

8

2000 2002 2004 2006 2008 2010

Mill

ion

met

ric to

ns

4

5

6

7

8

2000 2002 2004 2006 2008 2010

Mill

ion

met

ric to

ns

(EIA, 2012)

COAL | GLOBAL CONSUMPTION INCREASING

(WRI, 2012)

COAL | PROPOSED NEW COAL POWER CAPACITY

COAL | PROPOSED NEW COAL POWER CAPACITY

(WRI, 2012)

INDIA

(WRI, 2012)

COAL | PROPOSED NEW COAL POWER CAPACITY

INDIA

CHINA

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

2002 2004 2006 2008 2010 2012 2014

Rel

ativ

e to

200

2

EXPORTS

CONSUMPTION

COAL | U.S. COAL EXPORTS ARE RISING (2002 = 1.0)

(EIA, 2012)

WHAT TO WATCH 1. How many of the

proposed coal power plants will be built?

2. Will U.S. coal exports continue to grow?

(Photo: LHOON/Flickr)

NATURAL GAS | U.S. PRODUCTION INCREASING

(EIA)

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1990 1995 2000 2005 2010 2015 2020 2025 2030

Trill

ion

cubi

c fe

et

OTHER NATURAL GAS

SHALE GAS

NATURAL GAS | SHALE GAS PUTS DOWNWARD PRESSURE ON NATURAL GAS PRICES

(EIA, 2009-2012)

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Aver

age

Hen

ry H

ub s

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($)

2009

NATURAL GAS | SHALE GAS PUTS DOWNWARD PRESSURE ON NATURAL GAS PRICES

(EIA, 2009-2012)

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1990 1995 2000 2005 2010 2015 2020 2025 2030

Aver

age

Hen

ry H

ub s

pot p

rice

($)

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2010

NATURAL GAS | SHALE GAS PUTS DOWNWARD PRESSURE ON NATURAL GAS PRICES

(EIA, 2009-2012)

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2

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10

1990 1995 2000 2005 2010 2015 2020 2025 2030

Aver

age

Hen

ry H

ub s

pot p

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($)

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NATURAL GAS | SHALE GAS PUTS DOWNWARD PRESSURE ON NATURAL GAS PRICES

(EIA, 2009-2012)

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1990 1995 2000 2005 2010 2015 2020 2025 2030

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age

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ry H

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($)

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2012

NATURAL GAS | SHALE GAS RESERVES

(EIA, 2011)

N.B. Estimates for Russia and the Middle East are not included

WHAT TO WATCH 1. Will U.S. shale gas boom

continue or will it level off?

2. What will happen with the development of shale gas in China? What about India, the UK, South Africa, and other countries?

(Photo: Giorgio Giorgetti/Flickr)

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2004 2005 2006 2007 2008 2009 2010 2011 2012

Bill

ions

of d

olla

rs

Quarterly

RENEWABLES | WHERE NEXT FOR INVESTMENT?

(Bloomberg New Energy Finance, 2013)

N.B. Total values include estimates for undisclosed deals. Excludes corporate and government R&D.

2004 2005 2006 2007 2008 2009 2010 2011 2012

$268.7BN (2012)

RENEWABLES | COUNTRIES WITH RENEWABLE ENERGY TARGETS

(REN21, 2012)

With targets Without targets Map is illustrative; see REN21 for full list of countries

WHAT TO WATCH 1. Will countries make

progress on their commitments? Will new countries announce new energy targets this year?

2. How will this impact investments?

(Photo: Russian Reporter)

(Photo: Andreas/Flickr)

ENERGY MIX 1 “ECOLOGICAL PROGRESS” IN CHINA

2

2 TOWARD “ECOLOGICAL PROGRESS” IN CHINA?

CHINA DRIVES GLOBAL CONSUMPTION Share of the world total

48%

Iron

Ore

28%

CO

2 47%

Coa

l

45%

Stee

l

Cem

ent

53%

GD

P

10%

CHINA’S ENVIRONMENTAL DEGRADATION IS MASSIVELY COSTLY

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Cos

t of e

nviro

nmen

tal d

egra

datio

n as

%

of G

DP

equi

vale

nt

9.2% OF GDP

(World Bank reports, 2005-2012)

755 air quality index in Beijing

BEIJING AIR POLLUTION

CHINA LEADS ON RENEWABLE ENERGY Renewable energy installed capacity

(Pew, 2012)

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China UnitedStates

Germany Spain Italy Japan India France Brazil

Gig

awat

ts

China U.S. Germany Spain Italy Japan India France Brazil

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2000 2005 2010 2015

GD

P gr

owth

(%)

2017 (8.5%)

2013 (8.8%)

CHINA’S GDP GROWTH: WHERE NEXT?

(IMF, 2012)

18TH NATIONAL CONGRESS OF THE COMMUNIST PARTY OF CHINA, NOVEMBER 2012 “We must fully implement the overall plan for promoting economic, political, cultural, social and ecological progress.”

- PRESIDENT HU

(Photo: Remko Tanis/Flickr)

WHAT TO WATCH 1. How much progress will

China make toward its energy targets?

2. Will China make progress on its carbon trading pilots?

3. Will China develop its massive shale gas potential, which could in part displace its dependence on coal?

(Photo: World Bank Photo Collection/Flickr)

(Photo: Alvise Forcellini/Flickr)

ENERGY MIX 1 AFRICA’S LIONS

3 “ECOLOGICAL PROGRESS” IN CHINA

2

3 HOW WILL AFRICA’S LIONS GROW?

(IMF, 2012)

BOOMING ECONOMIES National GDP growth, 2007-2012

Ethiopia 8.9%

Equatorial Guinea

8.0%

Rwanda 7.5%

Sierra Leone 10.2%

Ghana 8.2%

Angola 9.2%

7.5%+ 5-7.4% 2.5-4.9% 0-2.4% Insufficient data

65% currently live in slums

36% 67% urban population in 2010

37% increase in middle class from 2000-10

(African Development Bank, Deloitte)

48% currently live in absolute poverty

AFRICAN CITIES GROWING QUICKLY

AFRICAN MIDDLE CLASS GROWING

urban population in 2050

(Freedom House, 2012)

Improved No change Worsened Insufficient data

A MIXED BAG Change in Freedom House rankings, 2002-2012

50% foreign direct investment going to extractive industries

(Photo: ENOUGH Project/Flickr)

$16bn 2011 Chinese investments in Africa

(Photo: Oxfam International /Flickr)

400m people living in the dry lands

THE GREAT GREEN WALL

(NASA; Pan-African Agency of the Great Green Wall)

SEC Rules (Photo: Securities and Exchange Commission/Flickr)

DODD-FRANK LEGISLATION PASSED IN 2010

(Photo: TREEAID/Flickr)

WHAT TO WATCH 1. Will we see more

transparency from extractive industries?

2. How will Africa respond to drought and food security issues? Will we see an expansion of efforts at regreening?

(Photo: CIFOR/Flickr)

ENERGY MIX 1 AFRICA’S LIONS

3 “ECOLOGICAL PROGRESS” IN CHINA

2 THE WORLD’S FORESTS

4

4 ARE WE TURNING THE CORNER ON FORESTS?

Forests provide $720 billion to global economies

13m hectares of forest lost per year

2.8 2.6 12

.5

2.6

Indonesia 23%

Other 42%

Brazil 35%

SHARE OF TROPICAL

DEFORESTATION, 1990-2010

BRAZIL AND INDONESIA: VITAL PLAYERS

(FAO)

WHAT TO WATCH 1. Will President

Yudhoyono extend the moratorium?

(Photo: CIFOR/Flickr)

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2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Thou

sand

s of

squ

are

kilo

met

ers

(National Institute for Space Research, Brazil, 2012)

DEFORESTATION IN BRAZIL IS ON THE DECLINE

WHAT TO WATCH 1. How will Brazil’s new

legislation, signed by President Rousseff impact the dynamics?

(Photo: Neil Palmer/CIAT)

Presenter

Presentation Notes

Dave will probably have the .idd file for the GFW logo

ENERGY MIX 1 AFRICA’S LIONS

3 “ECOLOGICAL PROGRESS” IN CHINA

2 GREEN INVESTMENT

5 THE WORLD’S FORESTS

4

5 WILL GREEN INVESTMENT SURVIVE THE SQUEEZE?

(Photo: Francisco Diez/Flickr)

-3

-2

-1

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2002 2004 2006 2008 2010 2012 2014

Rea

l glo

bal G

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grow

th (%

)

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-1

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2002 2004 2006 2008 2010 2012 2014

Rea

l glo

bal G

DP

grow

th (%

)

(World Bank, 2012)

UNCERTAIN TIMES – RISK AVERSION Change in global GDP

(CPI, 2012; Bloomberg, 2012)

GLOBAL ANNUAL CLIMATE FINANCE

$1 tr

illio

n WHAT IS NEEDED

2010-11

$364

bill

ion

(Photo: BIS)

FINANCIAL RULES | UNINTENDED CONSEQUENCES

Basel III Full compliance by 2019

(Photo: theverb.org/Flickr)

Green Climate Fund What role will it play?

PUBLIC SECTOR FINANCE | DE-RISKING MECHANISMS

(Photo: Michael Oko)

$175bn sustainable transport commitment

MULTILATERAL DEVELOPMENT BANKS | SEEDING NEW DEVELOPMENT

(UPS, Unilever, Johnson & Johnson)

CHANGING MINDSETS

NEW FINANCING STRUCTURES, NEW PLAYERS

(Photo: David Blaikie/Flickr)

WHAT TO WATCH 1. Will new funding

mechanisms emerge to de-risk the markets?

2. Will companies recalibrate risk and adopt longer-term perspectives?

3. Will new financing structures and new players emerge?

(Photo: Windwärts Energie GmbH)

(Photo: Barack Obama/Flickr)

ENERGY MIX 1 AFRICA’S LIONS

3 “ECOLOGICAL PROGRESS” IN CHINA

2 OBAMA AND CLIMATE CHANGE

6 GREEN INVESTMENT

5 THE WORLD’S FORESTS

4

“The issue of climate change is one that we ignore at our own peril.”

- Senator Barack Obama, 2006

6 WILL OBAMA LEAD ON CLIMATE CHANGE?

(Bloomberg Businessweek, 2012)

(Photo: NASA Goddard/Flickr)

EXTREME WEATHER 2012

2012 to be the hottest year on record for the contiguous United States

67% of global losses occurred in the U.S.

$60+ billion in damage from Hurricane Sandy

1% of GDP lost from drought

AMERICANS’ EVOLVING BELIEFS ON CLIMATE CHANGE

1 Pew, Oct 2012 2 Rasmussen, Nov 2012 3 Yale-George Mason University, Oct 2012

67% believe there is solid evidence of the Earth’s warming1

68% of likely voters say global warming is a serious problem2

74% believe global warming is affecting weather in the United States3

WHAT TO WATCH 1. Will we see more political leadership

on climate?

2. Who will President Obama appoint to his cabinet?

3. Will the Obama administration be a go-getter on climate change?

(Photo: Randy Le’Moine Photography/Flickr)

(Photo: National Park Service)

1 WHAT ENERGY MIX?

6 WILL OBAMA LEAD ON CLIMATE CHANGE?

3

HOW WILL AFRICA’S LIONS GROW?

4 ARE WE TURNING THE CORNER ON FORESTS?

5 WILL GREEN INVESTMENT

SURVIVE THE SQUEEZE?

2 TOWARD “ECOLOGICAL

PROGRESS” IN CHINA?