In 1913, the esteemed John D. Rockefeller established the Rockefeller Foundation with the intention of utilizing scientific advancements to address the world’s most pressing issues in health, energy, and food, aiming to enhance the overall wellbeing of humanity. After 107 years, the foundation has made the decision to divest its $5 billion endowment from fossil fuel investments, with its president Raj Shah declaring it necessary to align their investment strategy with their values and mission. The foundation has also pledged $500 million, in collaboration with partners Ikea and the Bezos Earth Fund, to establish the Global Energy Alliance for People and Planet at the COP26 climate conference. This initiative aims to accelerate investments in green energy transitions with the goal of providing reliable and renewable energy to 1 billion individuals, avoiding or minimizing 4 billion tons of carbon emissions, and generating or improving 150 million job opportunities.
In an insightful discussion with FT climate reporter Aime Williams, Shah provides insights into the progress being made towards climate goals. Williams asks if we can achieve the Paris Agreement objective of limiting global warming to 1.5 degrees by 2030. Shah expresses his belief that although it is possible, we are not currently on track to reach that goal. He emphasizes the need for substantial changes in our approach to make 1.5 degrees a viable option for humanity. This is particularly crucial for the most vulnerable 2 billion individuals, including coastal populations in Asia and those who rely on food production in the Horn of Africa. The consequences of high levels of migration in Central and North America also exacerbate the challenges faced by these vulnerable populations. Shah dismisses the notion that recent public policy decisions in Europe and the United States will automatically lead us towards the goal, emphasizing the importance of recognizing the aspirations of the 2-3 billion people at the bottom of the economic pyramid. These individuals seek a better standard of living and will consume the energy available to them, which currently predominantly relies on fossil fuels. Shah highlights the need to consider the developmental aspirations of these populations, as failing to do so is a major strategic error in our approach to combating climate change.
Williams then questions Shah about potential solutions to this dilemma. Shah acknowledges the need for increased deployment of renewable energy in the developing world. However, achieving this requires bold leadership commitments, similar to the efforts made after World War Two to reconstruct Western Europe. Shah emphasizes that the threat we face today is climate change, and our politics have thus far fallen short in taking aggressive action to transform the energy landscape in energy-poor countries. He advocates for a different kind of global leadership and a heightened commitment to address this critical task.
When Williams asks about the role of multilateral lenders, particularly the World Bank, in funding the energy transition in the developing world, Shah emphasizes the importance of clarifying the goal. Energy poverty is defined as having less than 1,000 kilowatt hours per capita per year. Currently, 3.6 billion people live below this threshold, inhibiting their participation in the global economy and eroding their economic prospects and aspirations. Shah argues that a public-private partnership model is crucial, going beyond the traditional instruments established after World War Two. The focus should be on enabling countries to access the latest technologies, setting high aspirations for renewable energy, and fostering private sector entrepreneurial activity. This is precisely the objective of the Global Energy Alliance for People and Planet (GEAPP), which Shah announced at the Clinton Global Initiative.
Overall, Shah highlights the urgent need for transformative action, both in terms of political leadership and financing, to address climate change and energy poverty in the developing world. By aligning our strategies and commitments, we can strive towards a sustainable future for all.
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