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Climate change

Published on November 18, 2013
Interview given by M. Pascal Canfin, Minister Delegate for Development, to the daily newspaper Les Echos

Paris, November 15, 2013

Q. – In the face of the increasing number of extreme climate events, do we need more prevention?

THE MINISTER – We must work on resilience – that is, preventing damage and managing risks. That’s one of the key elements for the success of the climate conference due to be held in Paris in 2015. Insurers must be galvanized to protect farmers, companies and local authorities against the growing risks of climate change, flooding and drought. Today infrastructure is still being built with a lifespan of 40 or 50 years, without climate stress tests being included at an earlier stage, in the design. Water drainage pipes, for example, aren’t built to dimensions to match the risk of flooding, the probability of which has clearly increased. I’d like the French Development Agency [AFD] to include these types of stress test in infrastructure projects. We ask banks to do stress tests in relation to systemic risks; well, the climate is a systemic risk.

Q. – Could Typhoon Haiyan be a turning point for states [to take action]?

THE MINISTER – Awareness has to be raised. We saw that Hurricane Sandy brought about movement on policies in the United States. There have also been tragic events in Mexico, which is one of the most proactive countries on climate change. Typhoon Haiyan may also have an influence. We must reduce our emissions but also integrate the effects of climate disasters into our economic models. It’s crucial to integrate climate risk into the regulation of banks and insurers, because they’ve got more or less carbon-neutral assets that help increase or reduce the systemic risk linked to climate change. To this effect, the IMF would have an important role to play.

Q. – Many countries – including Poland, where the world climate conference is being held – are reluctant. How can we make them change?

THE MINISTER – To obtain results and overcome the deadlock, we must work on the conditions enabling an ambitious commitment, particularly on energy efficiency and renewable energy. This dialogue on the opportunities is also true for South Africa and India.

Q. – What’s your development policy for the South?

THE MINISTER – 50% of the projects funded by the AFD must have simultaneous benefits for the climate. In the energy field, we set investment in renewable energy and energy efficiency as a priority, but we also chose to stop funding coal-fired power stations. In Burkina Faso, for example, the AFD, the EIB [European Investment Bank] and the European Union are going to finance the construction of the largest solar power station. We’ve lent money and provided subsidies so that the cost of the operation isn’t higher than a fossil fuel project. It’s what I call a positive agenda, an agenda of solutions.

Q. – Europe is freezing 900 million tonnes of carbon quotas. Is that a good decision?

THE MINISTER – Yes, we had to reduce the supply in order to bring prices back up. A green product becomes profitable at around €30 per tonne of CO2. I think that a minimum price for carbon is necessary, which I put at between €10 and €15 and which gives companies 10-year predictability, and why not a cap so as not to create pointless concerns? We must seek an agreement on this in Paris./.

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