By Sophie Mbugua: Paris: As nations of the world gathered on Monday in Paris to reach a new and universal climate change agreement, Germany, Norway, Sweden, and Switzerland has announced a new $500 million initiative that will find new ways to create incentives aimed at large scale cuts in greenhouse gas emissions in developing countries to combat climate change.
The initiative developed through the World Bank Group will measure and pay for emission cuts in large scale programs in renewable energy, transport, energy efficiency, solid waste management, and low carbon cities.
“We want to help developing countries find a credible pathway toward low carbon development,” said World Bank Group President Jim Yong Kim.
Dubbed the Transformative Carbon Asset Facility, the initiative will help developing countries implement their plans to cut emissions by working with them to create new classes of carbon assets associated with reduced greenhouse gas emission reductions, including those achieved through policy actions.
Speaking during the initiative launch at the global climate talk on the 21st Conference of Parties (COP21) in Paris, President Jim Yong Kim noted “This initiative will help countries create and pay for the next generation of carbon credits.”
The initiative is planned to start operations in 2016 until 2028 with an initial expected commitment of more than $250 million from contributing countries. With $2 billion support of investment and policy-related lending from the World Bank, the facility will remain open for additional contributions until a target of $500 million is reached.
The facility will help countries implement programs and policies that will assist developing countries in achieving their mitigation goals. Through the concept of net mitigation, the facility will only purchase a portion of the emission reductions generated by the programs with individual countries deciding if to use the remaining carbon portions to meet the targets outlined in their respective INDCs.