The OPEC Fund for International Development OPEC FUND QUARTERLY 3 2025
TIPPING POINTS The cascading impacts of global climate change
INSIDE STORY Behind the scenes with a climate negotiator
FINANCE FOR DEVELOPMENT
INTERVIEW Why renewables are not only indispensable but also unstoppable
Island Resilience Facility endorsed
1 How climate finance can find its way and fulfil its promise Searching for scale
The OPEC Fund Quarterly is published four times a year by the OPEC Fund for International Development. The OPEC Fund works in cooperation with developing country partners and the international development community to stimulate economic growth and social progress in low- and middle-income countries around the world. The organization was established by the member countries of OPEC in 1976 with a distinct purpose: to drive development, strengthen communities and empower people. Views and opinions expressed by guest contributors are solely the authors’ and don’t reflect the opinions or beliefs of the OPEC Fund. The OPEC Fund Quarterly is available free. If you wish to be included on the digital distribution list, please contact us via opecfund.org . Back issues of the magazine can be found on our website. The contents of this publication do not necessarily reflect the official views of the OPEC Fund or its Member Countries. Any maps are for illustration purposes only and are not to be taken as accurate representations of borders. Editorial material may be freely reproduced, providing the OPEC Fund Quarterly is credited.
PUBLISHERS The OPEC Fund for International Development Parkring 8, A-1010 Vienna, Austria Tel: (+43-1) 51564-0 Fax: (+43-1) 51392-38 www.opecfund.org
EXECUTIVE EDITOR Nadia Benamara EDITOR Axel Reiserer EDITORIAL TEAM Howard Hudson, Axel Reiserer, Nicholas K. Smith CONTRIBUTORS Hana Alhashimi, Zahraa Awada Badawi, Ines Fejzic, Valerie Herzog, Mahdi Rahimi PHOTOGRAPHS Abdullah Alipour Jeddi (unless otherwise credited) PRODUCTION Iris Vittini Encarnacion DESIGN Robin Turton, More Tea Design Ltd PRINTED IN AUSTRIA Print Alliance HAV Produktions Gmbh This publication is printed on paper produced from responsibly managed forests. Front cover illustration: ProVector – stock.adobe.com; Shutterstock AI; Robin Turton, More Tea Design
CONTENTS
5-29 CHRONICLE OF CURRENT EVENTS Cover story With the world facing multiple tipping points, how high are the stakes for climate finance?
6-7 Close to the tipping point: When do we exceed the 1.5°C climate target? 8-11 Interview Anthony Bartzokas, University of Athens: “Look beyond the funding gaps” 12-13 On the rocks: Why the clock is ticking for the world’s glaciers 14-17 Interview Francesco La Camera, IRENA: “The energy transition is delivering immense rewards” 18-19 Preventing the Amazon rainforest from reaching the point of no return 20-23 A former climate negotiator takes us behind the scenes 24-27 Amid low expectations for Belém, can meaningful progress be made? 28-29 The story of the tree of life
What future for the Amazon rainforest p 18-19
IN OTHER SECTIONS
In the Field 30-31 The OPEC Fund at the Sevilla Financing for Development conference: Island Resilience Facility endorsed Spotlight 32-35 Environmental & Social Safeguards: The OPEC Fund and AfDB join forces for sustainable development across Africa
Development News 36-38
Review 42-45
New OPEC Fund projects in Botswana, Cameroon, Costa Rica, Honduras, Liberia, Rwanda, Senegal and Türkiye Events 39-41 39 Mission to Maldives 40 Tashkent International Investment Forum; AIIB Annual Meeting 41 Mission to Kyrgyz Republic
A Modern Guide to Uneven Economic Development , edited by Erik S. Reinert and Ingrid Harvold Kvangraven The Back Page 46
Lesotho: “You have bigger power when you are more”
Photo: Xxxxxx
Photo: OPEC Fund
EDITORIAL
WHEN THE BUTTERFLY SHAKES THE OAK
“D oes the flap of a butterfly’s in Texas?” That was the radical question posed by US mathematician and meteorologist Edward Lorenz in his 1972 lecture to the American Association for the Advancement of Science. Over half a century later we are now witnessing the full and baffling force of “chaos theory” – how tiny variations in initial conditions can lead to wildly different outcomes across complex systems; outcomes that still challenge even the most sophisticated climate modelling. On the ground, wings in Brazil set off a tornado meanwhile, the interconnectedness of our economies and societies further compounds that complexity for international development. Anthropogenic global warming is clearly linear, but the knock-on effects for our climate are anything but. As we see in our tipping points story on page 6, the greening of the African Sahel may sound positive but could trigger feedback loops – particularly for the West African monsoon system. The northern expansion of Boreal forests may sound positive, but thawing permafrost could release hundreds of gigatonnes of greenhouse gases. What was previously unimaginable has already in some ways come to pass. Parts of the Amazon rainforest, “the lungs of the Earth,” have become net carbon emitters, as we see in our story on page 18. Once mighty glaciers from the Swiss Alps to the Peruvian Andes are “retreating,” often predictably but sometimes suddenly
and dangerously, as per our article on page 12. And even the hardiest of Mediterranean olive trees are in danger, as discussed on page 28. The world as we know it is changing fast and perhaps irrevocably. Yet many argue that we still have time to turn our vulnerabilities into strengths by facing the crosswinds arm in arm. When naysayers ask: “What is the point of yet another climate conference?” – as discussed on page 24 – one response is that the UN still has a plan in the form of the Paris Agreement. Yes, the world is warming fast, but renewables are clearly gaining ground and the energy transition has a momentum all of its own, as we hear in our interview with IRENA Director-General Francesco La Camera on page 14. Meanwhile the spirit of mutirão (a Brazilian term for “collective effort”) remains strong ahead of the COP30 meeting in Belém. That sentiment has a long pedigree, covering an entire generation of climate activists and concerned policymakers, including the UAE’s chief climate negotiator from COP28. A self-confessed “stubborn optimist,” Hana AlHashimi gives us the inside story on the road from Dubai to Baku to Belém, including late- night talks on the landmark Loss and Damage Fund on page 20.. Equally bullish is Anthony Bartzokas, founding director of the International Economics and Development Laboratory at the University of Athens, in our interview on page 8. He urges all sides to stop obsessing about “the trillions that are missing”
and focus instead on what steps are needed to scale up the global energy transition – from systematic knowledge sharing to investing in trade finance to empowering central banks in the credit ratings process. The road to climate justice may be long and winding, but so is development itself, according to our book review on page 42. A Modern Guide to Uneven Economic Development takes us on a post- colonial tour of economic theory, policy and practice, covering everything from poverty in Iran’s oil-rich Khuzestan province to the inexorable rise of South Korea, an economy built on steel, cars and electronics that grew 125,000 percent from 1955 to 2025. “Mighty oaks from little acorns grow” is an old English proverb that captures the metaphorical (and sometimes literal) strength of complex systems, be they Asian economies or American ecosystems. Every year for more than a millennium, tornadoes and hurricanes have shaken “Big Tree” on Goose Island on the border between Texas and Louisiana – and every year for over a thousand years that oak has weathered the storm thanks to its network of gnarly roots. Whatever happens in Brazil this November may be complex, chaotic and connect us in ways we cannot yet fathom, but a stubborn collective optimism seems our best bet for survival. Read on for our roadmap to mutirão .
Howard Hudson, Editor
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COVER STORY
CLIMATE FINANCE MAKE OR BREAK?
The world is facing a range of climate tipping points. Our challenge is to scale up our response – before it's too late
5
COVER STORY GLOBAL PERSPECTIVE
The race to net zero is not going as planned and the point of no return is getting nearer and nearer. Experts, though, are not entirely sure where, exactly, that point is By Nicholas K. Smith, OPEC Fund
T he Canadian journalist Malcolm Gladwell popularized the phrase “tipping point” in his bestselling book of the same name. “The tipping point is that magic moment when an idea, trend, or social behavior crosses a threshold, tips, and spreads like wildfire,” he wrote. The book, published in 2000, examines how some
carbon can really be in the atmosphere before temperatures dramatically accelerate? And, most topically given COP30’s location in Belém, Brazil, just how much of the Amazon rainforest (see page 14) can we afford to lose before there is no way to ever bring it back again?
Tipping Points Summary Report identified more than 25 parts of the Earth system that have tipping points. Some are very close already, like the collapse of the Greenland ice sheet, the Great Barrier Reef die-off and, of course, the ever-shrinking Amazon rainforest. Led by the University of Exeter’s Global Systems Institute and supported by more than 200 researchers, the Global Tipping Points Report also issued a number of recommendations to stave off the rush towards those tipping points such as phasing out fossil fuel and land use emissions and creating policies for positive tipping points, such as accelerating investment in renewables in the Global South. Yet one problem around any sort of tipping point is identifying where, exactly, that point is. A recent episode of The Economist magazine’s science and technology podcast about climate tipping points mentions that some models predict that the Greenland ice sheet will irreversibly start melting when global temperatures rise above 0.8°C above pre-industrial levels while other models state that point will occur at a 3°C increase. One issue is that the former
A 2022 article in the journal Science highlights that since average global warming temperatures have exceeded 1°C above pre-industrial levels, we are already at risk of triggering some tipping points. The paper identifies 16 global and regional tipping elements. According to the article, exceeding the 1.5°C
seemingly minor social trends, fads and ideas go mainstream, seemingly overnight. Often an idea will creep towards some sort of critical mass before becoming contagious, much the same way a virus does, Gladwell argues. These tipping points can be
thought of like a car speeding towards the edge of a cliff. There is danger ahead and at a certain point the car will still be on the cliff, but no amount of slowing or swerving can keep it from going over the edge. For decades, climate scientists have been carefully monitoring, and trying to pinpoint, exactly where some of the Earth’s tipping points are. In other words, just how much ice must melt before things become irreversible? How much
level targeted by the Paris Agreement would likely tip between six and ten of the 16 (see map). As the planet exceeded that mark last year, according to various observers, we will get a front row seat to see if the 2022 predictions turn out to be accurate. Knowing where these climate tipping points are becomes all the more necessary if we are to avoid them. One such effort was launched at COP28 in December 2023: the Global
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COVER STORY
system to detect climate pressure points before they arrive. The 26 teams of experts assembled within the program will work on a variety of projects which include using drones to better collect data on Arctic ice, deploying wind- propelled robots to monitor the ocean atmosphere and connecting subsea sensors with satellites to develop an automated data collection system that doesn’t require human intervention. The point of many of these projects is to have as many eyes on as many things as possible, so if something starts to shift in, say, an ice sheet or an atmospheric reading, you can be ready to counter it. A quarter-century after his breakout book, Gladwell published a follow up that looked at topics like COVID-19, the opioid crisis and social engineering. His Revenge of the Tipping Point from 2024 revisits many of its predecessor’s concepts that could easily be applied to the challenges surrounding climate tipping points: “If change happened gradually, you could see that you were getting closer and closer to your goal – and you wouldn’t be surprised when you reached it,” Gladwell writes. “But if nothing happens and then everything happens, you are in the strange position of being discouraged during the long stretch when nothing is happening and stunned at the point when it all shifts.”
Illustration: twelvee_id/Shutterstock
temperature has been reached decades ago while the latter temperature might never be reached. No one doubts that protecting the ice sheet from melting is essential, but so is knowing if it is too late to do anything about it.
The UK’s Advanced Research and Innovation Agency, which funds research and development across a range of areas, is working on a £81 million program Forecasting Tipping Points, which aims to develop an early warning
Regional tipping elements – the impact of exceeding the 1.5°C target
Arctic winter sea ice: Collapse
Barents Sea ice: Abrupt loss
Boreal permafrost: Collapse
Boreal permafrost: Abrupt thaw
Boreal forest: Southern dieback
Boreal forest: Northern expansion
Sahel/West African monsoon: Greening
Greenland ice sheet: Collapse
Low latitude coral reefs: Die-off
Labrador Sea/sub- polar gyre: Collapse
Global warming thresholds
Amazon rainforest: Dieback
< 2°C 2–4°C > 4°C
Atlantic meridional overturning circulation: Collapse
Mountain glaciers: Loss
West Antarctic ice sheet: Collapse
East Antarctic ice sheet: Collapse
East Antarctic subglacial basins: Collapse
Source: Science , Vol 377, Issue 6611, https://doi.org/10.1126/science.abn7950
7
COVER STORY INVESTMENT & INNOVATION
SEARCHING FOR SCALE IN SUSTAINABLE DEVELOPMENT
“Everybody’s talking about the trillions that are missing, but too few people are talking about what needs to be done on the ground,” argues Professor Anthony Bartzokas By Howard Hudson, OPEC Fund
F our years on from Mark Carney’s “billions to trillions” speech as UN Special Envoy for Climate Action and Finance, there is broad agreement – at least among observers – that the time for talk and half-measures is over. That means taking our eyes off the distant horizon and focusing instead on the next steps needed for the global energy transition. The money is there and the partners are willing, so how do we make it happen with sufficient scale and speed? A new research and policy center,
has already set out a range of recommendations for our era-defining transition – with proposals scrutinized at the highest levels, including recent G20 summits in Brazil (November 2024, on knowledge capacity for sustainable infrastructure) and India (July 2023, on how IFIs can be catalysts for financial innovation). In our interview, his first as director of the center, Bartzokas calls on the international development community to share knowledge systematically, be more transparent and substantially increase syndication. For quick wins he recommends a counter-cyclical investment in trade finance (which dovetails with the OPEC Fund Trade Finance Initiative launched at our Development Forum in June 2025). And perhaps most intriguingly, he calls for central banks to play a formal role in the credit ratings process.
Anthony Bartzokas
Anthony Bartzokas directs the International Economics and Development Laboratory at the University of Athens, where he holds the position of Professor of Development Economics. Also a Research Associate at the London School of Economics, Bartzokas specializes in sustainability, governance and financial management for multilateral and investment organizations. Previously, he worked with the United Nations University and the European Bank for Reconstruction and Development. He holds a PhD in the Economics of Technological Change from the University of Sussex, UK.
the International Economics and Development Laboratory at the
University of Athens, seeks to answer exactly that and more. Drawing on decades of learning from a range of international financial institutions (IFIs), the new center aims to break inertia and build momentum for climate-friendly sustainable development worldwide. Founding director Anthony Bartzokas
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COVER STORY
International Economics and Development Laboratory (IEDL) Founded in July 2025, the IEDL is a research initiative at the University of Athens that investigates growth dynamics, economic integration and structural transformation.
Its particular focus is on the erosion of global public goods and the critical role of financial markets in fostering innovation.
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COVER STORY
Growth in climate finance needs to increase five-fold by 2030 to meet the Paris Agreement goals The first graph shows that a dramatic increase in annual climate finance is needed to meet the 1.5°C goal by 2030. The second graph highlights that current adaptation flows need to increase nearly 200% to meet 2024-2030 adaptation needs in emerging markets and developing economies (EMDEs) alone.
institutions can join in this A-loan via a parallel loan structure. In addition, commercial parties – impact investors or institutional investors – are invited to participate via the B-loan structure. This has a catalyst effect, building a network of investors with credible asset solutions in developing countries. IFIs have been doing business in this standardized way for the last 50 years, basically raising loans for developing countries, so they have a large pool of these good investments on their balance sheets. Now the intermediaries are coming into the picture and saying: If you have a balance sheet of US$10 billion, including US$2 billion of loan syndications with credible private sector companies in sub-Saharan Africa, why not pass this on to us and take it off your balance sheet? This is a good example of how you can find practical bottom-up solutions for projects in sub-Saharan Africa, which improve the local financial system through innovative policies. OFQ : How else can IFIs make a difference? AB: Our laboratory is also investigating the obstacles, best practices and how knowledge is shared, including operational insights into how the allocation of capital enables innovation and sustainable development. I’ve also started research into global public goods, particularly knowledge, which can help fill the abovementioned gaps. There’s more than half a century’s worth of knowledge concentrated in IFIs, which needs to be quantified, standardized and disseminated. Developing countries need this knowledge, particularly the 44 UN- designated Least Developed Countries. Local financial capabilities are weak in these countries. Practical examples from IFIs include data and analysis on
8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0% US$ billion
US$ billion 300
250
200
150
100
50
0
Annual needs through 2030 under 1.5°C Annual climate finance
EMDE adaptation finance needs Global adaptation finance flows
* 2023 value estimate between US$1.5 and US$1.6 trillion
Source: Climate Policy Initiative, IIF
OPEC Fund Quarterly : This summer you founded the International Economics and Development Laboratory at the University of Athens. What will be the main focus? Anthony Bartzokas: I was elected Professor of Development Economics at the University of Athens in September 2024 and set up a new laboratory the following July to create the opportunity for researchers to investigate the real-life trends and challenges of sustainable development and the potential of financial innovation. Our starting point is to look beyond the funding gaps in sustainable development. Everybody’s talking about the missing trillions, but too few people are talking about what needs to be done on the ground. So we’re trying to build a bridge between policy-relevant research and
OFQ : What case studies can you already point to? AB: Consider what the banking sector is already doing for investment in sustainable development. Here’s one example of an “A/B loan”: Say you’re the CEO of a mining company in Africa and you need US$100 million for a major expansion. The local financial market can’t provide that kind of money, so you contact the African Development Bank (AfDB), which is a trusted partner to a large network of collaborating banks. Every now and then these banks share new opportunities for funding, for which you then apply. You do your due diligence and establish yourself as a credible partner. But still you’re based in sub-Saharan Africa, so private sector investors and other institutional investors remain hesitant. Recognizing that it’s a difficult
what happens in the field. My personal conviction is that: (a) economics is never an end in itself, but always a means to the end of contributing to the better allocation of scarce resources and (b) policy engagement is never a substitute for clarity, rigor and intellectual honesty.
environment, the AfDB takes on the riskier A component. Other development finance
“It’s important to bring in the central banks of developing countries. To not include them is a missed opportunity.”
Anthony Bartzokas, Professor of Development Economics, University of Athens
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COVER STORY
“We’re trying to build a bridge between policy-relevant research and what happens in the field.”
Anthony Bartzokas, Professor of Development Economics, University of Athens
loan syndications, where they become off-balance sheet structures for scaling up investments, while improving local capabilities and overall efficiency. How does this work in practice? Let me come back to loan syndications. One side, the beneficiaries, often suggest that we need to be more local-oriented. The other side, the international investment community, often cite quality problems for the lack of bankable projects in the pipeline. In my experience, it’s best to pursue investments where you can align local capabilities with local and international needs. Take infrastructure development, where investment decisions must be tailored to local communities. Those localized decisions don’t have to end there. Instead, they can feed into standardized approaches, which are often required by international investors. That in turn can improve efficiency and unlock future investments in developing countries. Moreover, where cross- border collaboration is needed for big infrastructure projects, these aspects are even more important. OFQ : How can we encourage more private sector involvement in sustainable development projects? AB: One tried and tested approach is to provide technical assistance to
help local stakeholders identify needs, formulate proposals and understand the regulatory environment. There should indeed be private sector involvement, even limited contributions, because that boosts investment capacity. This is the main issue when it comes to the polarization between bankable and missing markets. Where you lack investment capacity the way to create it is to add a thin layer of technical assistance to help identify needs and start building the project. It is also important to be practical and develop platforms where you can share the established practices and data of IFIs with local financial institutions from the Global South, as well as other institutional investors. The attractiveness and opportunities that the development finance asset class present have been reinforced by an impactful EIB initiative, i.e. the Global Emerging Markets Risk Database report on recovery statistics. This report, coupled with IFI-specific disclosure on sovereign default and recovery rate statistics, will contribute to an accurate risk assessment, mitigate the current disparity between perceived risk and actual risk, and grow investors’ confidence when investing in emerging markets. It’s important in this debate to bring in the central banks of developing
countries. To not include them is a missed opportunity because there’s one in every country and it’s usually a strong institution with fair credibility that monitors the quality of loans across the territory. However, there’s often a big gap between the data held by central banks and what the rating agencies are observing. The best way to break that inertia – and to help rating agencies make better decisions – is to bring the central banks formally into the process. OFQ : What should we be focusing on next? What holds the greatest potential for development effectiveness? AB: The challenge ahead for policy relevant research is how to gain a deeper understanding of the imbalances in capital allocation and innovation processes and how these imbalances can be effectively addressed with scalable innovation- driven and market-based solutions. Let me give you an example: Because we’re now dealing with deglobalization, a prominent area for easy wins is trade finance. At the same time there are fascinating technological changes – and opportunities – in how trade transactions are taking place. If we want to help developing countries catch up, including via sharing knowledge and building capacity, trade finance is a key area.
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GUEST CONTRIBUTION
A CHANGING WORLD GLACIERS
ON THE ROCKS It’s the International Year of Glaciers’ Preservation, yet opportunities to save them are melting away By Nicholas K. Smith, OPEC Fund
I n 1840, a man named Friedrich Simony, then in his late 20s, travelled to Dachstein in the Austrian Alps to study the mountains. Over the next 50 years, the geographer would return again and again to the region: Mapping its mighty elevations, measuring its lakes and, perhaps most importantly, snapping its glaciers. It is through his photographs that, for the first time, Simony was able to see something that now seems sadly commonplace. The glaciers were disappearing. These images provided the first scientific evidence that the Dachstein-Hallstätter Glacier was gradually getting smaller. Today, scientists estimate that because of the rapid rise in global temperatures, the Dachstein-Hallstätter Glacier, which has occupied the Alps for thousands of years, will disappear by the end of the century. What Simony, now known as the father of glaciology, saw over his career wasn’t just the shape of things to come, it was the beginning of the end of the glacier. Today you don’t need to compare photographs like Simony did to take in the scale of the loss. Many glaciers now have milestones marking where they once extended to, often a dramatic distance from where they terminate today. A recent paper in the journal Science noted that if present climate polices continue, less than a quarter of glacier mass will remain by the end of the century. That estimate assumes a 2.7°C warming. The paper notes that though there will be significant glacial loss, much can still be preserved if warming is kept to the magic 1.5°C level set in the Paris Agreement.
The (last) Year of the Glacier? In recognizing this slow-moving
sometimes is 100,000 years old, to understand what the atmosphere and climate was like long before humans were able to record it. These ice cores give us some insight into both the past and future; if the glaciers melt away the only remaining record of this knowledge could be efforts like the Ice Memory Sanctuary. This facility is currently being built in Antarctica by the Ice Memory Foundation, a scientific initiative, to house a collection of irreplaceable ice cores for future generations to research, much the same way that the Svalbard Global Seed Vault in Norway provides humanity a backup of the world’s crops. “The sight was Dantesque” Glacier retreat is most catastrophic for communities in developing countries living beneath them. But it is dramatic for wealthy countries too. In May, just three months after the UN kicked off the Year of the Glacier, the Birch Glacier in the Swiss Alps began to crack. A massive rockfall from the mountain on which it sits finally caused it to give way sending millions of cubic meters of debris down towards the village of Blatten.
catastrophe, the United Nations declared 2025 the International Year of Glaciers Preservation. At a January 2025 event introducing the year, Stefan Uhlenbrook, Director of Hydrology, Water and Cryosphere at the World Meteorological Organization (WMO), said, “We got the question, ‘why do we need another year, there are so many of these years and why do we need one on glaciers preservation?’” He then showed audience a data set showing how glacier mass had changed over the past 50 years. The bluer the bar, the more glacier mass had increased in a given year; the more red, the more mass a glacier had lost. As the chart approached the present day, the deeper red it became. “In the Swiss glaciers, they lost about 10 percent of their volume in only two years, so the situation is really dramatic,” Uhlenbrook said. Much is at stake when glaciers melt away. They hold about 70 percent of the world’s freshwater. Remove just a little of that amount and you have water scarcity, rising sea levels and an increased risk of floods and landslides, not to mention all the ecosystems and human livelihood (such as agriculture) that depend on that water supply. The faster glaciers melt, the more sea levels rise. Currently, oceans rise by about 4 millimeters a year – of which one full millimeter comes from glaciers. Glacier retreat is damaging in other ways. The frozen ice of a glacier is a kind of archive, one which traps dust, atmospheric particulates and even tiny bubbles of prehistoric air. Scientists take a core sampling of the ice, which
In May 2025, a collapsing Alpine glacier destroyed the Swiss village of Blatten
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A CHANGING WORLD
“Swiss glaciers, they lost about 10 percent of their volume in only two years, so the situation is really dramatic.” Stefan Uhlenbrook, Director of Hydrology, Water and Cryosphere at the World Meteorological Organization (WMO)
Annual global glacier mass changes, 1976-2023
Glacier mass change (gigatonnes): Negative values refer to ice loss while p ositive values refer to ice gain
-602
0
139
Source: C35/ECMWF/WGMS; Data – WGMS
In just a few seconds, rock and ice completely buried Blatten, destroying houses that had stood for centuries and, quite literally, wiped the town from the map. Before and after photos hardly seem like they were taken from the same place; only a few buildings and roads remained untouched. For all the destruction the Swiss glacier caused, only one death was recorded, a local shepherd who was outside the evacuation zone. The rest of the town of about 300 had fled to safety when it became clear that the Birch Glacier may not be entirely stable. Places without early warning systems, evacuation procedures or adequate protective infrastructure rarely fare as well. A melting glacier is not like an ice cube melting on the ground, which expands evenly. Glaciers often hold back huge
amounts of water and rock, so when they lose structural integrity they can quickly cause problems many miles away. For example, glacier lakes are a common, and picturesque, sight in the mountains. Yet like a bathtub slowly filling with water until it spills over, global warming and glacier melt create an ever-increasing risk that these lakes will spill over onto nearby communities. According to a 2023 estimate, 15 million people worldwide are at risk from these glacial lake “outburst” floods. “The changes we are making to our planet are increasing our collective risk,” said Jenty Kirsch-Wood, Head of Global Risk Management and Reporting at the United Nations Office for Disaster Risk Reduction. “As that risk is increasing, it is essential that we invest in better hazard monitoring.”
Monitoring every glacier in every country is an expensive endeavor and history is filled with stories of how quickly things can go wrong if there is no way to tell if danger is on its way, whether it is a slow drip or a force majeure. In 1941, a block of ice broke off from Peru’s Palcaraju mountain and fell into Lake Palcacocha. The resulting outburst flood killed at least 1,800 people and destroyed a third of the city of Huaraz. It only took the water 15 minutes from the initial crack of ice until the water reached the city. “The black water did not slide, but formed huge, inarticulate, boiling waves. Dense dust covered the scene. The sight was Dantesque,” a survivor later told an author researching the incident. “When I turned my face, my mother had disappeared.”
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INTERVIEW
“THE DEBATE ABOUT WHETHER THE ENERGY TRANSITION IS POSSIBLE IS BEHIND US”
IRENA Director-General Francesco La Camera on why renewables will succeed even without “the luxury of time” and how his institution helps developing countries escape the “triple penalty” of policy, capital and infrastructure By Axel Reiserer, OPEC Fund
OPEC Fund Quarterly : What plans and goals does IRENA have for COP30? The Brazilian Presidency has put “energy” on top of its “Action Agenda”, again calling for a “tripling of renewables and doubling of energy efficiency.” How is IRENA helping to deliver these goals? Francesco La Camera: Following COP28 in 2023, IRENA was tasked as the custodian agency for tracking progress towards the UAE Consensus goals of tripling renewable power capacity and doubling energy efficiency improvements by 2030. We are planning to launch our flagship tracking report at the Pre-COP, a series of meetings in the run-up to COP30, to provide a transparent picture of where the world stands on these targets. Preliminary findings suggest renewable power capacity will expand at a record pace again this year, bringing
the goals of the Paris Agreement closer than at any point since it was signed. The debate about whether the energy transition is possible is behind us. The tipping point has been passed, and we are now approaching the last mile. The challenge at COP30 is to ensure that this momentum translates into a human-centered transition that delivers equitable progress. Emerging markets and developing economies account for one-third of global GDP and comprise more than 150 countries – yet they receive less than 10 percent of energy transition investments. Unless this imbalance is corrected, progress will stall in the very regions where renewables could deliver the greatest benefits. In 2024, 91 percent of newly commissioned utility-scale renewable projects generated electricity at a lower cost than the cheapest fossil
Francesco La Camera
Francesco La Camera has led the International Renewable Energy Agency (IRENA) as Director- General since April 2019, bringing more than 30 years of experience in climate, sustainability and international cooperation to the agency. Under his leadership IRENA has forged a series a strategic partnerships in support of the energy transition. Previously, while holding key roles at the Italian Ministry of Environment, Land and Sea he spearheaded international cooperation on issues related to climate change and the environment.
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GUEST CONTRIBUTION INTERVI EW
“The challenge at COP30 is to ensure that this momentum translates into a human-centered transition that delivers equitable progress.”
Francesco La Camera, Director-General, IRENA
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INTERVI EW
“In 2024, 91 percent of newly commissioned utility- scale renewable projects generated electricity at a lower cost than the cheapest fossil fuel alternative.”
fuel alternative, making them the most affordable source of new power and the most economically rational path forward for emerging markets and developing economies (EMDEs). Beyond the climate imperative, the energy transition is delivering immense economic and social rewards. In 2024 alone, we estimate that renewable electricity generation helped avoid approximately US$467 billion in fossil fuel costs globally. For energy-importing regions, these savings strengthen economic stability and enhance energy independence, while the displacement of fossil fuels directly improve public health by cutting air pollution. Renewables have also demonstrated exceptional resilience, continuing to deliver reliably and shielding economies from the shocks of geopolitical turmoil. From 2018 to 2024, annual investments in renewables rose at an average of 14 percent per year, despite global crises ranging from the pandemic to inflation and trade disruptions. Brazil’s experience shows that the financing barriers facing EMDEs can be overcome. With clear policy signals, strong institutions and effective planning, the country has been able to attract large-scale private capital to its renewable energy sector. At the
investment decisions and ensures that capital flows where it is needed most. Together, GCEP and ETAF provide two essential levers of change: preparing investment-ready plans and unlocking the financing to realize them. This integrated approach narrows the gap between ambition, planning and action, resulting in concrete, bankable projects that deliver tangible benefits for communities around the world. We are also collaborating with the International Civil Aviation Organization (ICAO) to support the development and financing of sustainable aviation fuel (SAF) projects. The newly launched “Finvest@IRENA” portal operates under ETAF and serves as a single-entry point for SAF project developers seeking investment, linking proposals with a global network of public and private financiers. This is particularly timely, especially ahead of COP30, where sustainable fuels are expected to feature prominently on the agenda. OFQ : The preparations for COP30 were overshadowed by concerns about infrastructure, logistics and capacity. What can the organizers do to secure the success of the conference? FLC: Every COP comes with its own set of challenges, and managing a conference of this scale is never a small task. But Brazil is a country of great capabilities and a strong record of leadership on energy and climate. I have full confidence in Brazil’s ability to deliver a successful COP30. OFQ : What does IRENA as an advocate for renewable energy see as the biggest obstacles to the tripling of renewables? FLC: Numerous developing countries must overcome the multifaceted “triple penalty,” characterized by the
Francesco La Camera, Director-General, IRENA
Energy Planning (GCEP), launched under Brazil’s G20 Presidency. The coalition supports countries, particularly in the Global South, in preparing robust, credible and investment-ready energy plans, while strengthening institutions and governance. But planning alone is not enough. To help countries turn plans into projects, IRENA drives implementation through the Energy Transition Accelerator Financing (ETAF) platform. ETAF is a multi-stakeholder climate finance platform designed to mobilize up to US$5 billion by 2030 for renewable energy projects in developing countries. By connecting project developers with a coalition of public and private financiers, ETAF reduces risk, accelerates
request of the Brazilian G20 Presidency, IRENA analyzed this development arc to distil lessons for other countries facing similar challenges. The joint G20–IRENA report confirmed that integrating investment strategies into energy plans from the outset helps reduce perceived risks,
align policies with investor
expectations and unlock private capital at scale.
Building on this work, IRENA now serves as the Secretariat of the Global Coalition for
16
INTERVI EW
OFQ : IRENA and the OPEC Fund have forged a close relationship in recent years based on joint commitments. What has been achieved, what are the next exciting projects and where do you see space for this cooperation to develop even further? FLC: We have been working closely with the OPEC Fund through the ETAF Platform, where you are one of 14 partners. The OPEC Fund joined ETAF at its launch at COP26 in Glasgow and has since been one of the most agile partners, following up commitments with concrete support. Through this collaboration, IRENA has helped develop 10 renewable energy projects to date, including the Bumbuna Hydropower project extension in Sierra Leone, where joint missions were carried out to accelerate progress. This partnership illustrates how ETAF not only mobilizes capital but also strengthens the pipeline of bankable projects in developing countries. Ongoing support from the OPEC Fund will enable IRENA to scale up its project facilitation efforts further. Ultimately, playing a role in renewable energy solutions is not a privilege for the few, but a shared opportunity for all!
absence of supportive policies, the high cost of capital and inadequate grid infrastructure. Such hurdles lock these countries into reliance on older, more volatile energy systems, thereby exacerbating the global energy gap. Addressing these systemic barriers is essential to ensuring a truly inclusive and resilient global energy future. We need to take a hard look at why we are not moving faster and why more countries are not part of the “renewables revolution.” It is clear that we do not have the luxury of time to develop a clean energy system in the way the fossil-based system evolved over the past 150 years. To ensure a successful global energy transition there must be a simultaneous evolution of policy and regulatory frameworks. These must be adapted to account for the current dynamics and strategically guide investments in grid infrastructure and transmission routes, both on land and at sea. New locations for energy production, evolving trade patterns and changing centers of demand must also be considered. This effort must be complemented by a strategic reorientation of institutional capacities, ensuring that skills and capabilities are precisely aligned with the future energy system. OFQ : Will a re-scaling of emission targets undo the progress we have made or will it create space for a more gradual, affordable, equitable and more widely accepted process of energy transition? FLC: Renewables may be abundant, but it is our collective responsibility to make that abundance equitable by directing infrastructure investments, strong policies, technical skills and capacity as well as financing to where they are needed most. Abundance alone is not enough. True success means making renewables inclusive, accessible, affordable and fair for all. This calls on the global community to reimagine how international cooperation works. Initiatives such as the Accelerated
Partnership for Renewables in Africa (APRA), for which IRENA serves as Secretariat, are already delivering results. The first APRA Investment Forum in Nairobi mobilized projects worth approximately US$2.7 billion across 25 projects with a combined capacity of around 1 GW. It demonstrates how collaborative action can mobilize resources, build trust and turn ambition into project pipelines. Building on this momentum, we co- hosted the second APRA Investment Forum with the Government of Sierra Leone in October 2025, further strengthening regional leadership and collaboration. And we intend to replicate this model in other regions - Central Asia, Southeast Asia and Latin America - so that investment flows not only grow in scale but also reach the places where they matter most. OFQ : What, in your opinion, is the perfect energy mix? FLC: There is no single blueprint for the “perfect” energy mix. Each country must define its own transition pathway based on its national circumstances, resource endowment and development priorities. What is clear, however, is that the backbone of the global energy system will be renewables, complemented by green hydrogen and the sustainable use of biomass. In this way, the energy transition is not about maximizing the share of renewables at any cost, but about shaping a balanced system that keeps the 1.5°C target within reach. IRENA’s 1.5°C Scenario, presented at the World Energy Transitions Outlook 2024, shows that by 2050 renewables are set to provide 77 percent of global primary energy supply, with electricity accounting for over half of the total final energy use. Clean hydrogen and its derivatives are on course to cover some 14 percent of the energy mix, largely serving hard-to-abate sectors, while modern biomass is likely to contribute about 8 percent. Together, these elements underpin a climate-safe, affordable and resilient energy system.
“There is no single blueprint for the ‘perfect’ energy mix. Each country must define its own transition pathway based on its national circumstances.”
Francesco La Camera, Director-General, IRENA
17
A CHANGING WORLD RAINFORESTS
PREVENTING THE AMAZON FROM REACHING A TIPPING POINT The world’s largest rainforest is under threat like never before. The consequences will be felt everywhere By Axel Reiserer, OPEC Fund
A s the UN climate change conference COP30 comes to the Amazon, forests will be a central topic of the 12-day event in Belém. The largest rainforest in the world “is under siege like never before,” warns the World Wide Fund for Nature (WWF). The main threats include unchecked agricultural expansion, illegal mining and logging, wildfires and the impacts of climate change, according to the non-profit organization Amazon Conservation. The Amazon rainforest, often called “the lungs of the Earth”, is so big that it makes its own climate: Its billions of trees produce enough moisture to form clouds, which provide at least a third of the forest’s life-sustaining rainfall. But climate change is disrupting this circular process. The build-up of greenhouse gases in the atmosphere has raised regional temperatures, worsened droughts
The Amazon region could
and increased the risk of fires. Fewer trees mean less rainfall, higher temperatures and yet more fires. Climate change induced deforestation therefore risks becoming self-perpetuating.
shift back to being a major carbon sink, removing as much as 18 gigatonnes of carbon over 30 years.
18
A CHANGING WORLD
Much of the rainforest will turn into a dry savannah, and the tens of billions of tonnes of
carbon dioxide stored there will be released into the atmosphere, further heating the planet. Talks at COP30 will focus on how to stop, if not reverse a worrying trend: An estimated 17 percent of Amazonian forest cover has been lost and a further 17 percent degraded. Experts believe that the “tipping point” teeters around 20-25 percent. That’s the threshold beyond which self-sustaining processes irreversibly push a part of the Earth’s climate system from one state into another. This grim scenario dubbed “Amazon dieback” is one of the nine “tipping points” identified by the Intergovernmental Panel on Climate Change (IPCC). The “dieback” is among the most urgent as the Amazon rainforest is not only critical for the world’s climate thanks to its capacity for carbon capture, but also as a huge treasure trove of biodiversity: Despite covering only around 1 percent of the Earth’s surface, the Amazon rainforest is home to 10 percent of all known wildlife. In recent years, the centrality of the role of forests in the planet’s global temperature regulation system has come into the spotlight with the incorporation of the REDD+ mechanism under the umbrella of nature-based solutions. REDD+ stands for “Reducing Emissions from Deforestation and Forest Degradation”, the “plus” signifies further measures such as conservation, sustainable forest management and the enhancement of forest carbon stocks. These include the biological capture and sequestration of carbon, carried out through the photosynthesis of trees, in schemes that create financial incentives and rewards. For example, the state-owned Brazilian Development Bank (NBESD) plans to finance the restoration of 6 million
Brazilian rainforest residents: Squirrel monkey and capybara
“Brazil is uniquely positioned to help change how tropical forests are treated in global climate efforts.”
Beto Veríssimo, Amazon Institute of People and the Environment, and Juliano J. Assunção, University of Rio de Janeiro
hectares in the Amazon by 2030 and a further 18 million hectares by 2050 – hoping to attract substantial investments from the private sector and capital markets, which are interested in carbon credits. On the eve of COP30 the two Brazilian researchers Beto Veríssimo and Juliano J. Assunção published a paper calling for an entirely new viewpoint: “Brazil is uniquely positioned to help change how tropical forests are treated in global climate efforts: not merely as victims of deforestation and carbon emissions, but as vital assets in the fight against climate change.”
water, and supporting healthy ecosystem services,” they say. Seeing rainforests as assets will create the window to design a financial model that will reward regions for growing new forests and removing carbon, and another to reward the protection of standing forests. In the Brazilian Amazon, where much deforestation is driven by low-yield cattle grazing, even modest payments for carbon could be transformative. The region could shift from being a major carbon emitter back to being a major carbon sink, removing as much as 18 gigatonnes of carbon over 30 years. Meanwhile, the proposed Tropical Forest Forever Facility (TFFF) would offer annual payments to countries for each hectare of preserved forest. The proposal suggests US$4 per hectare per year, with steep penalties for any deforestation - a system that effectively pays countries to keep forests standing. Though not tied to carbon credits, the logic is simple: Reward stewardship and penalize forest loss. This approach treats forests like infrastructure, worthy of maintenance funding, just like roads or power grids. Veríssimo and Assunção state: “Tropical forests can be central to solving the climate crisis. Their protection and restoration can also bring economic benefits.”
To reach an effective climate solution, they argue, two major
actions are essential: First, a drastic worldwide reduction of new emissions and continuation of the path toward net zero by 2050. Second, even if emissions are brought down to almost zero (they are rising at the moment!) massive amounts of carbon must still be removed from the atmosphere. Belém, the authors write, is a “golden opportunity” to address these challenges by reforestation and regeneration: “Unlike expensive and unproven carbon-capture technologies, forest regeneration is affordable, scalable, and ready to deploy today. Focusing on forest restoration also brings other benefits: protecting biodiversity, conserving
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