#2 World Bank Carbon Financing

Lesson 2G: The World Bank Carbon Finance Programme, and Prototype Carbon Fund
The World Bank's carbon finance programme is part of a series of initiatives to contribute to the global effort to combat climate change, and to the Bank's mission to reduce poverty and improve living standards in the developing world. The threat climate change poses to long-term development and the ability of the poor to escape from poverty is of particular concern to the World Bank. The impacts of climate change could unravel many of the development gains of the last several decades.
The World Bank is therefore trying to ensure that developing countries and economies in transition can benefit from international efforts to address climate change, including the emerging carbon market for greenhouse gas emission reductions. Their stated mission is to “catalyze a global carbon market through the purchase of high quality emission reductions in climate-friendly projects in developing countries and economies in transition”. The Carbon Finance Programme is the first large scale initiative that seeks to catalyze private sector investments to address a global environmental issue.



Lesson 2G: The World Bank Carbon Finance Programme, and Prototype Carbon Fund
The Prototype Carbon Fund (PCF) is a partnership between 17 companies and 6 governments, managed by the World Bank, which became operational in April 2000. As the first carbon fund, its mission is to pioneer the market for project-based greenhouse gas emission reductions while promoting sustainable development and offering a learning-by-doing opportunity to its stakeholders. The PCF will pilot production of Emission Reductions within the framework of Joint Implementation (JI) and the Clean Development Mechanism (CDM). The PCF will invest contributions made by companies and governments in projects designed to produce Emission Reductions fully consistent with the Kyoto Protocol and the emerging framework for JI and the CDM. Contributors, or "Participants" in the PCF, will receive a pro rata share of the Emission Reductions, verified and certified in accordance with agreements reached with the respective countries "hosting" the projects. Canada has contributed millions of dollars to the PCF, and expected to received certified carbon emission reduction credits to help it meet its Kyoto Protocol targets once the Protocol enters into force.



Lesson 2 Summary
In this Lesson, you learned about the terms and applicability of the United Nations Framework Convention on Climate Change.
You learned about the terms and applicability of the Kyoto Protocol to the United Nations Framework Convention on Climate Change.
You also learned about Joint Implementation and Clean Development Mechanisms.
Finally, you learned about controversies within the international climate change system.