The World Bank will lend EUR 250 million to Poland to help the country improve its air quality and energy efficiency. This financing was approved on Wednesday by the World Bank Group’s Board of Executive Directors, who represent the institution’s shareholders.
In this new project, the World Bank will support the scale-up of the Clean Air Priority Program. The program offers assistance and incentives to owners of single-family buildings that rely on old, polluting boilers to replace them with cleaner, more efficient installations, and get their houses insulated. It is implemented by the Polish Ministry of Climate and Environment and the National Fund for Environmental Protection and Water Management (NFOŚiGW) in cooperation with 16 regional funds. It is the largest air quality and energy efficiency program in Europe, expected to cover three million households and significantly improve air quality, whilst generating tangible benefits for health, environment, and climate.
“In partnership with the Polish institutions and the European Commission, we helped lay the foundation for a universal, nationwide initiative for air quality improvement in Poland three years ago. Now we are reinforcing our cooperation, with a combination of financial and technical support designed to strengthen the Clean Air Priority Program. Our ambition over the next five years of our partnership is to support both the decarbonization of the heating sector as well as the program’s inclusion and pace,” said Gallina A. Vincelette, World Bank Country Director for the European Union.
The loan funds from the World Bank’s new Program for Results (PforR) operation will go directly to the state budget and be disbursed according to the reform milestones achieved by the Clean Air Priority Program. These include policy enhancements, such as the launch of a lowest-income component and expanding commercial bank participation, as well as targets based on the number of boilers upgraded and homes renovated.
“The Ministry of Climate and Environment is helping improve the quality of air through programmatic, legislative, and financial actions. Over the last three years, we have demonstrated that the Clean Air Priority Program, with a monthly uptake of up to tens of thousands of participants, is a real platform for the improvement of air quality in Poland. But we cannot sit back and relax. On the contrary, we are determined to make further improvements and broaden the initiative, especially by reaching out to the lowest-income population. We are delighted that the World Bank continues to be our international partner on this journey,” said Anna Moskwa, the Minister for Climate and Environment of Poland.
Poland has struggled with air quality for years. According to international estimations, more than 46,000 people die prematurely due to poor air quality every year. As much as 80 percent of pollution is generated by burning poor-quality fuel in single-family buildings, which are targeted by the World Bank’s PforR.
“In fighting smog, we care about the good health of people and the environment, while contributing to the much-needed energy transition in Poland. For a long time, we have been working closely with civil society, smog alerts, and local communities to find optimum solutions for this priority issue. Our efforts have also benefited from the support of international institutions, such as the World Bank and the European Commission,” said Bartłomiej Orzeł, Polish Prime Minister’s Plenipotentiary for the Clean Air Priority Program.
For many years, the World Bank has supported countries in their air quality improvement efforts. The countries that have received World Bank financing or advice on this reform agenda include, among others, China, India, Peru, Egypt, Chile, and Mexico.
Canada’s bold policies can underpin a successful energy transition
Canada has embarked on an ambitious transformation of its energy system, and clear policy signals will be important to expand energy sector investments in clean and sustainable energy sources, according to a policy review by the International Energy Agency.
Since the IEA’s last in-depth review in 2015, Canada has made a series of international and domestic climate change commitments, notably setting a target to cut greenhouse gas emissions by 40-45% from 2005 levels by 2030 and a commitment to reach net zero emissions by 2050.
To support those climate and energy targets, governments in Canada have in recent years worked on a number of policy measures, including an ambitious carbon-pricing system, a clean fuels standard, a commitment to phase out unabated coal-fired electricity by 2030, nuclear plant extensions, methane regulations in the oil and gas sector, energy efficiency programmes and measures to decarbonise the transport sector.
“Canada has shown impressive leadership, both at home and abroad, on clean and equitable energy transitions,” said IEA Executive Director Fatih Birol, who is launching the report today with Jonathan Wilkinson, Canada’s Minister of Natural Resources. “Canada’s wealth of clean electricity and its innovative spirit can help drive a secure and affordable transformation of its energy system and help realise its ambitious goals. Equally important, Canada’s efforts to reduce emissions – of both carbon dioxide and methane – from its oil and gas production can help ensure its continued place as a reliable supplier of energy to the world.”
Canada’s profile as a major producer, consumer and exporter of energy presents both challenges and opportunities for reaching the country’s enhanced targets. Energy makes up 10% of gross domestic product and is a major source of capital investment, export revenue and jobs. Moreover, Canada’s highly decentralised system of government means that close coordination between federal, provincial and territorial governments is essential for a successful energy transition.
“This report acknowledges Canada’s ambitious efforts and historic investments to develop pathways to achieve net-zero emissions by 2050 and ensure a transition that aligns with our shared objective of limiting global warming to 1.5 degrees Celsius, “ said Minister Wilkinson. “These are pathways that make the most sense for our people, our economy and our country and will also yield technology, products and know-how that can be exported and applied around the world.”
The IEA finds that emissions intensity from Canada’s oil and gas production has declined in recent years, but the sector remains a major source of greenhouse gases, accounting for about a quarter of the country’s GHG emissions. Along with strong action to curb methane emissions, improving the rate of energy technology innovation will be essential for the deep decarbonisation that is needed in oil and gas production, as well as in the transport and industry sectors. Canada is actively advancing innovation in a number of key fields, including carbon capture, utilisation and storage; clean hydrogen; and small modular nuclear reactors, with a view to serving as a supplier of energy and climate solutions to the world. The IEA notes that further federal support for research, development and demonstration would help accelerate progress towards these goals.
The IEA is also recommending that Canada’s federal government promote a comprehensive energy efficiency strategy in consultation with provinces and territories that sets clear targets for energy efficiency in the buildings, industry and transport sectors
The IEA report highlights that Canada’s electricity supply is among the cleanest in the world, with over 80% of supply coming from non-emitting sources, thanks to the dominance of hydro and the important role of nuclear. To further support the expansion of clean power and electrification, the report encourages increased interconnections among provinces and territories to ensure balanced decarbonisation progress across the country.
The IEA commends Canada on its efforts to advance a people-centred approach to its clean energy transition, including initiatives to promote diversity and inclusion in clean energy sectors; programmes to increase access to clean energy in northern, remote and Indigenous communities; and actions to enable just transitions for coal workers and their communities.
“Canada has laid out a comprehensive set of policy measures and investments across sectors to meet its climate targets, including a strong clean energy component to its Covid-19 economic recovery efforts,” said Dr Birol. “I hope this report will help Canada navigate its path toward economy-wide emissions reductions and a net zero future.”
Iran to add 10GW to renewable energy capacity
Iranian Energy Ministry and some of the country’s private contractors signed memorandums of understanding (MOU) on Sunday for cooperation in the construction of renewable power plants to generate 10,000 megawatts (10 gigawatts) of electricity across the country.
The signing ceremony was attended by senior energy officials including Energy Minister Ali-Akbar Mehrabian and Head of Renewable Energy and Energy Efficiency Organization (SATBA) Mahmoud Kamani, IRIB reported.
The MOUs were signed following the Energy Ministry’s public call for the contribution of private companies in a project for developing renewable power plants in the country.
According to SATBA, after the ministry’s public call, so far 153 requests for the generation of 90,000 megawatts (MW) have been submitted to the ministry by private companies.
Speaking in the signing ceremony, Energy Minister Ali-Akbar Mehrabian said: “When the private sector invests in this industry [the renewables], the government is obliged to return the equivalent of the investment plus its interests to the investor.”
Mehrabian noted that the government has allocated over 30 trillion rials (about $101 million) for the development of renewables in the budget bill for the next Iranian calendar year (begins on March 21), saying that it is an unprecedented budget in this area.
Further in the ceremony, SATBA Head Kamani mentioned some of the Energy Ministry’s plans for the development of the country’s renewable energy industry, saying: “Export of renewable energy is a goal that has been targeted by the government.”
“Constructing renewable power plants for the cryptocurrency miners is also being seriously considered,” he added.
Back in December 2021, Kamani had announced plans to create 10,000 MW capacity of new renewable power plants across the country within the next four years.
He had put the current capacity of the country’s renewable power plants at 905 MW, saying that such power plants account only for one percent of the country’s total power generation capacity.
“Currently, 30 percent of the world’s electricity needs are provided by renewable energy sources, and some countries have even declared 2030 as the final year of using fossil fuels,” he said.
“We are far behind the global standards in the development of renewable energy,” he regretted.
Referring to another program for the development of renewable energies in the domestic sector, Kamani noted that to encourage households for constructing such power plants the Energy Ministry has announced that it will buy their surplus generated electricity at a guaranteed price.
He further pointed to the indigenization of the knowledge for the construction of the equipment used in renewable power plants as another priority of the Energy Ministry and SATBA, saying: “Currently, the construction of solar panels and wind power plants is completely indigenized, and we must strengthen our producers to finally become able to build all the required equipment from start to finish, in this regard, of course, some enterprises have announced their readiness.”
Tajikistan’s Energy Sector to Benefit from World Bank Support
The World Bank’s Board of Executive Directors approved today additional grant financing of $65 million in support of the Second Phase of the Nurek Hydropower Rehabilitation Project, which will contribute towards more reliable electricity supply and expansion of renewable energy exports in Tajikistan.
“The World Bank is committed to supporting Tajikistan’s energy sector, given the country’s considerable potential in hydropower generation and export of clean, renewable energy resources,” said Ozan Sevimli, World Bank Country Manager in Tajikistan. “Investments in the Nurek hydropower plant – the mainstay of the country’s energy system – are essential in ensuring stable and reliable electricity supply for households and businesses domestically, as well as increased revenues from export at the regional market.”
The first phase of the Nurek Hydropower Rehabilitation Project, financed by the World Bank with $225.7 million; the Asian Infrastructure Investment Bank (AIIB) with $60 million; and the Eurasian Development Bank (EaDB) with $40 million, was launched in March 2019. It supports the rehabilitation of three of the nine generating units and the key infrastructural components of the power plant, replacement of six autotransformers that are used to evacuate the generated electricity, enhancement of dam safety to protect the facility from seismic hazards and floods and technical assistance to strengthen operational, technical, and financial management capacity of the utility company Barqi Tojik. The project’s second phase, financed by the World Bank ($50 million approved in June 2020), supports the rehabilitation of the remaining six generating units, the Nurek bridge, the powerhouse, and other key buildings, while also strengthening the capacity of the hydropower plant (HPP) to effectively operate and maintain the plant’s operations.
The additional financing of $65 million approved today is intended to reduce the current financing gap of $164 million for the second phase of the project. The remaining gap is expected be covered by other potential co-financiers, including reallocation of savings from the EaDB and AIIB resources allocated for the first phase of the project. The total World Bank investments for this strategically important project amounts to $341 million.
The Nurek HPP generates about 50 percent of total annual energy demand in Tajikistan and supplies most of the energy for exports. Due to technical problems, the power plant’s initial installed capacity of 3000 megawatts has reduced to 2,320 megawatts over the past four decades. The facility is currently undergoing its first major rehabilitation since its commissioning in 1972-1979. Once completed, the rehabilitation will allow to increase the HPP capacity to 3,214 megawatts that will ensure improved electricity supply during the cold winter months and bringing much-needed revenues from expanded electricity exports during the summer months.
The rehabilitation will also ensure dam safety improvement measures, which will help lower operational and maintenance costs. Lastly, the project will generate global environmental and climate mitigation benefits in the form of net reduction of CO2 emissions, leading to 69 million tCO2e net reduction in emissions versus the baseline during the project’s economic life.
The World Bank Group’s active portfolio in Tajikistan includes 23 projects, totaling $1.2 billion that aim at helping Tajikistan to take advantage of emerging regional opportunities, transform its economy, and improve the livelihoods of its citizens. Since 1996, the World Bank has provided over $2 billion in grants, highly concessional IDA credits, and trust fund resources to the country.
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