Interview: Private sector's support for climate change reaches new level: UN senior official

Financing and support from the private sector in the fight against climate change have reached a new level around the world, a senior UN official in charge of climate change said.

UN Assistant Secretary-General on Climate Change Janos Pasztor made the remarks in an exclusive interview with Xinhua during the World Bank Group and International Monetary Fund Annual Meetings in Lima this week.

Pasztor said that in 2014, companies made commitments worth 200 billion U.S. dollars to decarbonize their investments.

"This year, we checked how these commitments are being implemented. A major finding of our latest report is that most companies are implementing their commitments, many have gone further than they pledged, and some new companies have made their own pledges," Pasztor said.

The UN report, released on Thursday and titled "Trends in Private Sector Climate Finance", reveals that the private financial community is forging a strong relationship with the public sector ahead of the United Nations Climate Change Conference (COP 21) to be held in Paris in December.

It lists five major points as evidence of this shift.

Private companies across the world have committed hundreds of billions of dollars to fight climate change, and 50-70 billion dollars of green bonds will be issued in 2015.

Meanwhile, the number of companies using internal carbon pricing increased by around 300 percent last year. Many investors are now divesting high-carbon investments by decarbonizing their portfolios, and insurance companies are developing new tools to cover growing climate risks and resulting vulnerability.

While acknowledging that the Chinese private sector had not gone as far, Pasztor praised the country's efforts, including its new emissions trading scheme.

"We have had some contracts with Chinese institutional investors, although the input has not been as broad. That is still to come," he said. "However, in areas like green bonds, China is very strong. The People's Bank of China's focus on green financing is very significant."

According to Pasztor, China's policies will also make its private companies and state-owned enterprises alike to move toward green financing.

"China has started the world's largest national emissions trading system to begin in 2017. That will have consequences we have not yet seen. We do not know the positive implications it will have for the world, let alone China," the official said.

As part of a joint presidential statement on climate change with U.S. President Barack Obama, Chinese President Xi Jinping said during his September state visit to the United States that China "plans to start in 2017 its national emission trading system, covering key industry sectors such as iron and steel, power generation, chemicals, building materials, paper-making, and nonferrous metals."

The scheme commits China to promoting low-carbon buildings and transportation, with the share of newly built green buildings reaching 50 percent and the share of public transport reaching 30 percent in big- and medium-sized cities by 2020.

However, Pasztor warned that this progress from the private sector was still not going far enough, even when combined with public efforts, to keep the world under the two degrees Celsius temperature growth limit.

"Companies are seeing the writing on the wall. We are at the cusp of a new low-carbon economy. Companies that are leading the pack will benefit in the future because they reacted faster than others," Pasztor said.

"However, we must now push for a package to come out of the inter-governmental negotiations in Paris in December that will accelerate this whole process," he concluded. Endi