Denmark is on its way to introducing a world-first tax on greenhouse gas emissions from agriculture in 2030.
Central to the proposals – announced by the Danish government on 24 June – is the plan to charge farmers for emissions from their livestock.
This carbon tax would cost around €100 (£85) annually per cow, according to the Financial Times.
The proposal is one part of a wider agreement between the government and different agriculture and environmental groups aimed at helping the country meet its climate goals for 2030 and beyond.
As a major producer of dairy and pork, one-quarter of Denmark’s greenhouse gas emissions come from agriculture.
In this Q&A, Carbon Brief explains the agriculture tax plans, the possible impacts on farmers and the effect it could have on cutting Denmark’s emissions.
- How will the tax work?
- How will this tax help Denmark meet its climate targets?
- How was the agreement reached?
- What will the tax mean for Danish farmers?
- Are other countries planning to introduce a carbon tax on agriculture?
How will the tax work?
Under the proposed plans, Danish landowners will pay a levy based on their emissions from “livestock, fertiliser, forestry and the disturbance of carbon-rich agricultural soils”, the Copenhagen Post reported.
The effective cost of the tax paid by farmers will amount to 120 Danish kroner (£14/$18) per tonne of CO2-equivalent (CO2e) emitted when the tax is implemented in 2030. It will rise to 300 kroner (£34/$44) per tonne of CO2e from 2035 onwards.
The true cost of these taxes is actually higher (300 kroner per tonne of CO2e in 2030 and 750 kroner per tonne from 2035 onwards), but the government will also implement a 60% deduction. The aim of this “basic tax break” is to “limit the impact of the measure on production costs”, says EurActiv. It adds that, in the long run, “the most climate-efficient farms could be close to paying no tax”.
The proceeds of the levy “are to be pooled in a fund to support the livestock industry’s green transition for at least two years after the tax comes into effect”, according to the Guardian.
The tax is just one element of a wider agreement on a “Green Denmark”. This was signed by a “green tripartite”, namely, a three-party agreement between the Danish government, conservation groups and the Danish industrial and agricultural sectors.
The agreement aims to “form the long-term basis for a historic reorganisation and transformation of Denmark’s land and of food and agricultural production”.
Under the deal, Denmark will relinquish some agricultural lands to provide more space for nature and biodiversity. Those lands will comprise heaths, meadows, river valleys and bogs that had historically been converted to agriculture.
The country will plant 250,000 hectares of new forests by 2045 and set aside 140,000 hectares of lowlands to protect their carbon-rich soils by 2030. It will also acquire strategic agricultural lands and distribute or sell them to private and public investments to “contribute to large nature areas” or “installation of renewable energy” and boost technologies and measures to cut emissions, the agreement says.
All these targets will be financed by a new Denmark’s Green Area Fund, which amounts to 40bn kroner (£4.6bn/$5.9bn). Denmark’s government will also use EU agricultural subsidies for the technology transition.
Finally, the agreement also aims to improve Denmark’s coastal waters and freshwater and reduce nitrogen fertiliser use.
The Danish parliament still needs to approve the plan, but Reuters noted that “political experts expect a bill to pass following the broad-based consensus”.
How will this tax help Denmark meet its climate targets?
According to Denmark’s most recent national inventory report, the agricultural sector is the country’s second-largest source of emissions, after the energy sector.
Agriculture contributes around 28% of Denmark’s total greenhouse gas emissions, the report says, and accounts for more than 80% of methane and nitrous oxide emissions specifically.
A “major part” of these emissions stem from livestock production, the report says. Denmark has more than 15,000 livestock farms containing millions of cows, pigs and other animals.
The country’s high agriculture emissions “cannot continue”, the climate minister Lars Aagaard said in a statement about the CO2-cutting proposals, adding that a “great deal of work awaits” to implement these plans.
By 2030, the country is aiming to cut overall greenhouse gas emissions by 70% and agriculture and forestry emissions by 55-65%.
The new proposals are estimated to cut 1.8m tonnes of CO2e emissions in 2030, according to the government.
This will help Denmark meet its 2030 climate goals and “take a big step closer to becoming climate neutral in 2045”, tax minister Jeppe Bruus said in a statement.
The agreement will also boost forests, large wetlands and nature protection, according to the president of the Danish Society for Nature Conservation, Maria Reumert Gjerding.
Prof Søren Petersen, a soil microbiologist at Aarhus University in Denmark, agrees that the plan “could lead to substantial reductions in agricultural emissions” if implemented correctly. He tells Carbon Brief:
“It is my impression that there is a real interest in promoting climate-smart solutions and developing solutions that achieve real reductions in emissions.”
Petersen says that the agreement highlights the “need to speed up” new climate technologies and measures to cut greenhouse gas emissions from agriculture. He adds:
“Perhaps the greatest barrier at the moment is that many technologies with potential for greenhouse gas mitigation have not yet been sufficiently documented, or that the source is highly variable and difficult to quantify.”
He notes that it is often “difficult to measure” agricultural emissions, adding:
“If we can arrive at a set of criteria for documenting emissions, and effects of mitigation measures, and if such criteria can also be accepted in the international review of the national inventory, then I do think there is potential for developing several technologies for use at farm level.
“But tangible impact will require land use changes, as well as mitigation technologies.”
Niklas Sjøbeck Jørgensen, senior advisor on food and bioresources at Green Transition Denmark, an environmental thinktank, says the agreement is “an important step in a greener direction”.
But, he says, it “fails by maintaining problematic animal production”, adding in a statement:
“Unfortunately, the CO2 tax is correspondingly lagging behind, as the floor deduction of 60% and large technology subsidies maintain the current intensive form of animal production.”
How was the agreement reached?
The Danish government and the other members of the green tripartite reached this “historic agreement” after almost five months of talks, Politico reported.
Agreeing the tax “has been a very difficult journey”, Martin Kristian Brauer, chief economist at the Danish Agriculture and Food Council, one of Denmark’s largest organisations representing farmers and part of the green tripartite, tells Carbon Brief.
Brauer says his organisation had been against the tax from the beginning of the negotiations since “the risk connected to such a tax is far too big for the sector”. But over the past two years, they have worked on identifying those risks, listening to farmers’ concerns and negotiating with the government. He tells Carbon Brief:
“Although we have many [farmers] in Denmark still oppos[ing] this tax, I think we reached a point where we can live with it.”
Brauer says that broad participation of the different sectors was fundamental to allowing this “very difficult issue” to turn “into real politics”. He tells Carbon Brief:
“That was an agreement among all the parties. It was not just closing a lot of agricultural farms and thereby reducing emissions. The goal was to make a new regulation, where Danish agriculture meets climate goals, but [also having] the possibility to develop…an economically sustainable sector.”
Members of the tripartite agreed that the country “must have a strong and competitive” agricultural sector “with attractive business potential and jobs”, according to a statement by the Danish Ministry of Economic Affairs.
The agreement also stated that the new Green Area Fund would attempt to “facilitate a land conversion that mitigates the economic consequences for Danish agriculture”.
Brauer points out that there will be subsidies to incentivise farmers to enrol in the programme. The Green Area Fund, according to the agreement, will support private afforestation, the conservation of aquatic ecosystems and drinking water and the conversion of other lands, including wetlands and lowlands.
What will the tax mean for Danish farmers?
Petersen tells Carbon Brief that the agricultural CO2 tax proposal is “quite flexible and lenient on farmers”.
He notes that the gradual increase in the cost farmers will pay from 2030 to 2035 will “buy time for farmers to adjust, and for researchers to deliver the documentation of the effects of potential mitigation measures”.
In fact, farmers that comply with proven climate solutions “can avoid the tax”, according to a statement by Søren Søndergaard, president of the Danish Agriculture and Food Council.
The agreement provides a number of climate measures already available for farms from fertiliser use to livestock feed management. It also states that Denmark’s government will document and look for new climate technologies and measures for the agricultural sector.
Feed additives may be used to reduce direct emissions from livestock, Brauer notes. He tells Carbon Brief:
“That is an additive put into the feed and when the cows eat [it], emissions are reduced by maybe 20 or 30%.”
Another part of the agreement is land conversion and management. The territorial reorganisation will be planned and implemented by local governments, with the participation of coastal water councils and river basin management groups, the agreement says.
Brauer, from the Danish Agriculture and Food Council, says that land conversion does not mean farmers will lose their lands, instead, they will receive a subsidy to “convert the land”. He tells Carbon Brief:
“The farmer in Denmark in the future will be not just an agricultural farmer, he will actually be a land manager and will have some areas which [are] going to be traditional agricultural farming, forests and maybe wetlands. So he will have a portfolio of different kinds of lands in his state that will all generate some income.”
The agreement points out that farmers’ participation in setting aside carbon-rich shallow soils and reducing nitrogen emissions is voluntary, but they can obtain financial incentives from the new fund for doing so.
Brauer adds that for those goals, each Danish region is mandated to reach certain targets. He says:
“If that area does not meet these goals together, then there will be a mandatory regulation set up for each farmer, pushed from the government.”
Regarding how small producers would be impacted, the agreement mentions that it is being analysed how to determine when a producer or farm will be subject to taxation, through a threshold that aims “to exempt farms with relatively low greenhouse gas emissions to ensure that the total administrative and economic costs of the tax are commensurate with the potential CO2e reductions”.
Are other countries planning to introduce a carbon tax on agriculture?
Denmark is the first country to introduce this kind of legislation, although other countries have considered it and, until recently, New Zealand was pioneering similar moves.
Around half of New Zealand’s greenhouse gas emissions come from agriculture, primarily livestock. To tackle this, in 2022 the previous government planned to include agriculture in the country’s emissions trading scheme from 2025 onwards.
Under this scheme, the government sets a limit for the amount of greenhouse gases companies in certain sectors can emit. Companies whose emissions fall under the limit can sell their extra allowances to other organisations. These limits reduce over time, in line with climate targets.
Some New Zealand farmers protested these plans and the government received pushback from farm lobby groups.
In June this year, the country’s relatively new centre-right government scrapped plans for the so-called “burp tax” – a reference to the methane produced by livestock. This fulfilled a “pre-election pledge by [New Zealand prime minister] Christopher Luxon’s National Party”, Al Jazeera said at the time.
The government said it would instead invest hundreds of millions of dollars on emissions-reduction technology and boost funding for an agricultural greenhouse gas research centre.
Agriculture minister Todd McClay said that the government is “committed to meeting our climate change obligations without shutting down Kiwi farms”.
The Green and Labour parties criticised the government’s decision, Radio New Zealand reported.
In the EU, there have been on-and-off discussions about bringing agriculture into the bloc’s emissions trading system.
In March, Carbon Pulse reported that the EU was “testing the waters” on either creating a new emissions trading system for agriculture or revising existing rules.
Since then, a new European parliament was elected and the next European Commission line-up will be finalised this summer.
The EU’s climate advisory board earlier this year recommended introducing emissions pricing for agriculture and land use.
Danish prime minister, Mette Frederiksen, said she hopes Denmark’s planned agriculture carbon tax will “pave the way forward regionally and globally” for similar moves, the Financial Times reported.
Brauer says that farmers in Denmark are “quite concerned” about the tax as it may lead to Danish products being “a little bit more expensive than a product from Germany or from elsewhere”. He adds:
“If we get some kind of regulation in the whole EU, this difficulty would disappear.”
The post Q&A: How Denmark plans to tax agriculture emissions to meet climate goals appeared first on Carbon Brief.
Q&A: How Denmark plans to tax agriculture emissions to meet climate goals
Climate Change
DeBriefed 3 July 2026: US faces scorching Independence Day | Record ocean temperatures | Vietnam’s EV surge
Welcome to Carbon Brief’s DeBriefed.
An essential guide to the week’s key developments relating to climate change.
This week
Heating up
NOT FREE FROM HEAT: “Dangerous, record-breaking” heat altered plans for 4 July celebrations across the US this weekend, reported the Associated Press. New York and Boston hit 100F (37.8C) on Thursday, said the newswire. CNBC reported that temperatures of up to 105F (40.5C) are forecast in central and eastern parts of the country, with “daily, monthly and all-time records possible”.
TEMPERATURES SOAR: Heat that hit western Europe last week spread east to “scorch” Germany, Hungary, Romania, Poland and others, said Bloomberg. Red warnings for extreme heat were issued in a number of nations, noted the outlet, adding that the heat “underscores how climate change is transforming summers in the world’s fastest-warming continent”. The Independent said last month was confirmed to be England’s hottest June on record.
HEAT DEATHS: June’s extreme temperatures caused more than 2,000 excess deaths in Spain and France, reported the Guardian. The countries are bracing for further heat that “could bring temperatures of 44C (111F) over the coming days”, said the newspaper. Deaths in France rose almost 30% at the heatwave “peak” on the week of 22 June, according to Le Monde. Last week’s conditions also led to around 480 excess deaths in the Netherlands, reported Reuters.
BOILING: Global ocean temperatures reached record levels for this time of year, reported NBC News, “fuelling fears of more dangerous heatwaves this summer and fanning concerns over the escalating global climate crisis”. Scientists told the Financial Times that this could lead the world towards “uncharted territory”. The newspaper said global average sea surface temperatures reached 20.96C on 21 June, exceeding June records for 2023 and 2024.
Around the world
- GOAL DROPPED: The World Bank will “abandon” its goal to devote 45% of annual lending resources to climate-related projects, reported Reuters. Carbon Brief explored what it could mean for global climate action.
- FIVE-YEAR PLAN: China plans to invest more than 20tn yuan ($2.9tn) in “key energy projects and new business models” over the next five years, according to International Energy Net.
- DRILLING: The Guardian said UK Labour politicians “urged” the likely next prime minister Andy Burnham to ignore “deluded” calls to develop the Rosebank oil field located in the Atlantic north of Scotland.
- PLASTIC TALKS: Countries and activists feared key issues could be sidelined at “critical” talks on a global treaty to curb plastic pollution in Kenya, said Climate Home News. A treaty could have “important implications” for climate change, reported Carbon Brief in 2024.
- CANADA PIPELINE: Canadian prime minister Mark Carney announced plans to build an oil pipeline to supply Asia with up to 1m barrels per day, reported the Financial Times. Earlier this week, Carney called the previous government’s climate plans “expensive” and “divisive”, said CBC News.
63
The number of UK newspaper editorials calling for more oil and gas extraction in the North Sea so far in 2026, according to Carbon Brief analysis.
Latest climate research
- Including emissions from permafrost thaw raises the likelihood of the Arctic becoming a net-carbon source by more than 50% at 2C of warming | Earth System Dynamics
- Net-zero scenarios relying less on carbon dioxide removals lead to fewer residual emissions, which offers greater health improvements for “non-white and low-income groups” in particular | Nature Climate Change
- Agricultural plots of land in sub-Saharan Africa owned by women face heat impacts 2-2.5 times higher than those owned by men | Nature Sustainability
(For more, see Carbon Brief’s in-depth daily summaries of the top climate news stories on Monday, Tuesday, Wednesday, Thursday and Friday.)
Captured
Wind and solar were the world’s largest source of new energy in 2025, according to Carbon Brief analysis of the latest Energy Institute statistical review of world energy. Wind and solar also saw the fastest growth, up by 18% in 2025. Nevertheless, every source of energy – including coal, oil, gas, nuclear and hydro – also reached global all-time highs last year.
Spotlight
Vietnam’s EV surge
Carbon Brief explores the reasons behind soaring electric-vehicle sales in Vietnam.
Motorbikes are a constant fixture on streets across Vietnam. They pollute the air in cities and make crossing the road a feat of endurance.
But, increasingly, people are moving away from petrol-powered vehicles to save money and reduce air pollution.
Sales of electric motorbikes, scooters and mopeds more than doubled in Vietnam last year, according to a recent report from the International Energy Agency (IEA).
This identified that Vietnam has the largest electric vehicle (EV) market in south-east Asia.
Nearly one-in-five of the two-wheeled vehicles sold last year were electric, it noted, in a nation with 102 million people and 77m motorbikes.
This is “particularly impactful” given they are the main mode of transport in Vietnam, said Lam Pham, Asia energy analyst at thinktank Ember. He told Carbon Brief:
“Electrifying road transport is essential for Vietnam to achieve its net-zero target by 2050. Road transport accounted for around 86% of transport-sector emissions in 2022.”
The nation has just 6.8m cars, but this number is also climbing, partly due to EVs, with nearly 40% of new car sales being electric.
This is “above levels seen in most European countries”, noted the IEA. (The UK’s figure is around 30%.)
EV incentives
Fuel costs surged in south-east Asian countries earlier this year after the energy crisis caused by the US-Israel war on Iran.
This “accelerated” discussions from “why use EVs” to “why keep paying more for fuel”, said Dr Tham Nguyen, a lecturer at the Ho Chi Minh City campus of Australia’s Royal Melbourne Institute of Technology (RMIT) University, who has researched Vietnamese public attitudes to EVs.
But the surge is “not driven by fuel prices alone”, noted Pham.
Increased EV sales can also be attributed to a “convergence of affordability, convenience and sustainability”, Nguyen said:
“Vietnamese consumers buy EVs because they see real value with immediate personal benefits, such as cost savings and energy security, alongside long-term environmental gains.”
Government policies have also incentivised sales through registration fee exemptions and tax cuts for EVs.
Another factor is affordable EVs sold by Chinese companies and Vinfast, a Vietnamese manufacturer. The IEA report noted that Vietnam is the only country in south-east Asia with “sizeable” domestic production of accessible EVs.
Vinfast reported a 219% year-on-year increase in orders for electric motorbikes and e-bikes in the first quarter of 2026, but the company has yet to turn a profit.
Pham noted that “growing public awareness of air pollution” has also “dramatically strengthened” public support for EVs.
Future plans
Vietnam’s major cities also have plans to get drivers to go electric or turn to public transport.
The capital city Hanoi announced that it would ban fossil-fuel-powered motorbikes from a central zone this month, but this has been postponed until 2028.
Ho Chi Minh City, the nation’s largest city with more than 9.5 million people, intends to introduce low-emission zones and swap 400,000 petrol-powered motorbikes to electric by 2028.
The city’s green transport plans focus on metro lines, electric buses and e-bikes, explained RMIT associate professor Catherine Earl. She noted that walking and cycling are currently “not popular, accessible or safe for many residents in Ho Chi Minh City’s hot and humid climate”.
Looking ahead, Pham said Vietnam could focus on “purchase subsidies, financing schemes and adequate charging or battery-swapping infrastructure, to ensure lower-income riders, including delivery and ride-hailing drivers, are not negatively affected”.
Watch, read, listen
‘JUST 1%’ OF EMISSIONS: The Guardian debunked arguments that climate actions from smaller countries are “insignificant”.
DRILLING RISKS: Mongabay reported on the possible impacts oil drilling in the Amazon could have on a “little-known reef”.
HEATING UP: The BBC Climate Question podcast discussed the weather pattern El Niño and its links to climate change.
Coming up
- 7-10 July: AI for good global summit, Geneva, Switzerland
- 7-15 July: UN high-level political forum on sustainable development, New York
- 8-10 July: Ninth meeting of the board of the fund for responding to loss and damage, Manila, Philippines
Pick of the jobs
- Green Alliance, senior partnerships officer | Salary: £42,748-£47,346. Location: London
- World Vision, environment and climate action senior adviser | Salary: Unknown. Location: Kenya
- Nature Energy, interim associate or senior editor | Salary: Unknown. Location: London or Milan
- Climate Analytics, senior communications manager – climate policy (maternity cover) | Salary €60,605-€66,880. Location: Berlin
- Carbon Exchange, researcher | Salary: Unknown. Location: Hong Kong
DeBriefed is edited by Daisy Dunne. Please send any tips or feedback to debriefed@carbonbrief.org.
This is an online version of Carbon Brief’s weekly DeBriefed email newsletter. Subscribe for free here.
The post DeBriefed 3 July 2026: US faces scorching Independence Day | Record ocean temperatures | Vietnam’s EV surge appeared first on Carbon Brief.
The World Bank has abandoned a target for 45% of the funding it gives developing countries to be “climate finance”, following months of pressure from the Trump administration in the US.
However, a concerted effort by developed- and developing-country shareholders has seen the bank hold onto its “action plan” for tackling climate change.
The multilateral development bank (MDB) – which is headquartered in Washington DC – is the single largest provider of climate finance globally, distributing $39.2bn in 2025 alone, primarily as loans.
Amid widespread aid cuts by developed countries, the World Bank and other MDBs have previously pledged to significantly scale up their climate finance over the next decade.
Despite scrapping its central target, the bank says it will continue to support the demands of its “clients”, many of which have explicitly stated their need for climate-related investment.
Here, Carbon Brief looks at the likely impact of the World Bank’s policy shift and whether it is – as one expert puts it – “mostly a symbolic victory” for the US.
- How does the World Bank support climate action?
- Why has the World Bank abandoned its climate-finance target?
- Why is the World Bank important for international climate finance?
- How will these changes affect global climate action?
How does the World Bank support climate action?
The World Bank is the oldest and largest MDB. It is tasked by its 189 member governments – the bank’s shareholders – with supporting development projects around the world.
The US is the bank’s largest shareholder, followed, in order, by Japan, China, Germany, France and the UK.
Every year, the bank provides billions of dollars – predominantly as loans – to developing countries.
(One part of the World Bank, the International Development Association – IDA – specifically distributes grants to lower-income nations, as well as lower-interest loans.)
Through its financing, the World Bank also has an important role in “mobilising” private investments in developing countries.
In recent years, the bank has increasingly focused on helping developing countries to cut emissions and adapt their economies for climate change.
The World Bank provided $164bn in what it calls financing with climate “co-benefits” between 2020 and 2025.
The largest share of this funding – roughly one-fifth – went to clean energy and electricity access projects. Smaller shares went to areas such as public transport, water supply and sustainable farming.
As the map below shows, the largest recipients of the bank’s climate funds since 2020 have been emerging economies, such as Turkey ($10.3bn), India ($9bn) and Nigeria ($6.3bn).
Among the largest World Bank projects in recent years are two extensive programmes in India, totalling nearly $3bn, supporting renewables and green hydrogen.
Others include $1.7bn for a Pakistan hydropower project, $926m for Iraq’s railways and $803m to boost “green development” in Colombia.
Despite the bank’s major role in providing climate finance to developing countries, it has faced heavy scrutiny from climate advocates.
In particular, they have noted the dominance of loans that push developing countries further into debt. The World Bank has also been criticised for a lack of transparency around how it classifies projects as “climate-related”, as well as “over-reporting” of climate finance.
Why has the World Bank abandoned its climate-finance target?
When World Bank president Ajay Banga – nominated by former US president Joe Biden – took over the institution in 2023, there were widespread calls for MDB reform.
Many of the bank’s shareholders wanted to see billions more dollars being channelled to support climate action. Later that year, Banga announced that the bank would ensure that 45% of the bank’s funding was climate finance by 2025.
This replaced an existing target of 35% for climate finance between 2021 and 2025, which had been set out in the bank’s second climate change action plan (CCAP).
The CCAP is intended to “mainstream” climate action in the bank’s work. With it in place, the World Bank’s climate finance more than doubled from $17.2bn in 2020 to $39.2bn in 2025.
As the chart below shows, this meant the World Bank exceeded its 2025 goal, with climate-related projects making up a 48% share of total funding that year.
When Biden was replaced by Donald Trump as president in 2025, the US administration turned against international cooperation, including climate finance.
However, the US did not walk away from the World Bank, where it exerts considerable power as the largest shareholder.
With the CCAP due to expire in July 2026, the US has spent months pressuring the bank and its shareholders to weaken or abandon the plan altogether.
US Treasury secretary Scott Bessent issued a statement during the 2026 World Bank and International Monetary Fund (IMF) spring meetings in April 2026, in which he called for “jettisoning” the 45% climate-finance target. More broadly, he said:
“We welcome the coming expiration of the CCAP and…expect the bank to immediately shift its myopic focus on climate and financing volumes to one that emphasises high-quality, durable projects.”
This vision involves a push for the World Bank to finance more fossil-fuel projects, including drilling for new gas. (The bank has committed since 2019 to stop funding upstream oil and gas projects.)
The decision on whether to continue with the CCAP was negotiated behind closed doors by the board of directors – representing national shareholders. There were reports of “deep divides”.
A joint statement from 19 of the 25 directors last year affirmed the need for both a plan and a target. The US, Russia, Kuwait and Saudi Arabia all declined to sign up, while Japan and India abstained, according to Reuters.
There were reports of European nations championing a climate plan, bolstered by support from the developing countries that would stand to receive climate finance. The US call to drop the 45% target entirely was reportedly backed by Saudi Arabia and Russia.
Ultimately, the day before the CCAP was due to lapse, the World Bank announced what appeared to be a middle ground. It would drop both the 45% target and the 35% goal it had replaced, while also “extend[ing]” the CCAP.
UK development minister Jenny Chapman told a committee hearing in the House of Commons the next day that this marked a “compromise”. She said:
“It wasn’t clear we were going to get a CCAP at all and a bank without an action plan on climate is a problem for us – so that’s a good outcome.”
Supportive shareholders had been pushing for a one-year extension of the plan. While the World Bank did not initially define the length, Chapman confirmed on LinkedIn that the plan had, in fact, been extended “indefinitely”.
The bank said it would also engage an “independent evaluation group” to assess the CCAP, in line with a board request.
Gaia Larsen, director of climate finance at the World Resources Institute (WRI), tells Carbon Brief that this evaluation will likely be “relatively free from political ideology” and could be “focused on how to make the CCAP more effective”.
Why is the World Bank important for international climate finance?
Under the Paris Agreement, developed countries – including major World Bank shareholders in Europe and elsewhere – are obliged to provide climate finance for developing countries.
This includes a target of $300bn a year by 2035, which is expected to largely come from developed countries. One significant way these nations can contribute to this goal is via their support for MDBs, particularly the World Bank.
The World Bank has described itself as “by far the largest provider of climate finance to developing countries”. Each year, it oversees half of all climate finance from MDBs and far more than any single donor country.
Many developed countries have, therefore, enthusiastically backed the World Bank’s climate efforts, as well as a “bigger” role for MDBs in development more broadly. The bank can lend sums that far exceed the amount of new public finance that individual nations are willing to commit.
This is particularly significant, given many of these nations, including the UK, Germany and France, have announced large cuts to their aid budgets in recent years.
Carbon Brief analysis suggests that roughly a fifth of the international climate finance provided and “mobilised” by developed countries in recent years can be attributed to their World Bank contributions, as the chart below shows.
(This only accounts for the World Bank financing that can be linked to developed-country shares in the bank. Developing countries, such as China, also have significant shares, which are not included in the chart below.)
MDBs – including the World Bank – have committed to providing $120bn in climate finance to developing countries by 2030.
This was set to come from greater shareholder contributions, combined with a programme of reforms to free up capital.
If the World Bank continued to provide half of the MDB total, it would need to increase its climate finance by around 50%, from $39.2bn today to $60bn in 2030.
Therefore, experts see a “key” role for the World Bank in achieving not only the $300bn target, but also the more aspirational $1.3n target that countries agreed as part of the “new collective quantified goal” (NCQG) on climate finance at COP29 in 2024. This includes the private capital it could “unlock” through its lending.
Joe Thwaites, international climate finance director at Natural Resources Defense Council (NRDC), tells Carbon Brief that these “NCQG politics” are “quite important”. He says:
“The maths of the $300bn does not work if the MDBs pull back and so I think that’s why you’re seeing developed countries taking a stand.”
How will these changes affect global climate action?
To date, the World Bank has only released minimal details about its new climate plans. As such, experts say the impact on future climate finance remains uncertain.
Jon Sward, environment project manager at the Bretton Woods Project, tells Carbon Brief:
“They have said they are going to retain all the same processes about climate-finance reporting. So, of course, there is a world in which, actually, climate finance continues to increase like it has been.”
Some of the World Bank’s internal organisations will, in fact, keep their climate-finance goals for the time being. For example, the IDA’s largely grant-based funding retains a 45% target for its current round, which will last until 2028 – the year of the next US presidential election.
However, WRI’s Larsen tells Carbon Brief that the changes, from a bank that was previously a “champion for climate action”, remain significant:
“This reality, reinforced by the elimination of the 45% goal, means that it would not be surprising to see a reduction in climate investments.”
In a statement, the World Bank said its “work on climate is and will remain firmly client driven”, noting that it supports nations undertaking their Paris Agreement climate plans.
Therefore, its climate focus may come down to whether there is demand for climate action from “client” countries receiving finance.
At an April event in discussion with the climate sceptic Bjørn Lomborg, Bessent said that global financial institutions should focus on growth, characterising climate action as an “elite belief”.
The implication from the US Treasury secretary was that recipient countries are not interested in climate action. However, as reported by Devex, a group of World Bank shareholders representing nearly 100 developing countries, wrote a letter that appeared to push back against this framing.
This “G11+” group, led by Brazil and China, said the bank “must remain firmly client-driven”, noting that countries are “following nationally determined pathways toward climate action”. NRDC’s Thwaites tells Carbon Brief:
“It’s one thing for the Europeans to talk about climate…This was the client countries [100 developing countries] saying: ‘No, we want this.’”
Recent research by the ODI thinktank found that 79% of developing-country officials polled wanted to see MDB investment in solar projects, 54% wanted hydropower and 47% wanted wind power. Only 13% wanted investment in gas-power plants.
Rishikesh Ram Bhandary, a senior development researcher at Boston University, has stressed the need for an “enhanced CCAP”, which could be supported by the bank’s new independent evaluation. Among other things, he tells Carbon Brief:
“The bank needs to make a more convincing case about how climate change is being integrated into development priorities rather than competing with them.”
Thwaites says he is hopeful that the outcome is “mostly a symbolic victory for the US”.
However, he says major shareholders from Europe and elsewhere should make it clear to the bank that it is not “the only game in town” when it comes to climate finance. He says:
“If [the World Bank] are going to cave into one shareholder, when the vast majority of the other shareholders are supportive of continuing climate action, they can take their money elsewhere.”
The post Q&A: How will the World Bank’s abandoned finance goal affect climate action? appeared first on Carbon Brief.
Q&A: How will the World Bank’s abandoned finance goal affect climate action?
Rich Wilson is CEO of the Iswe Foundation and co-founder of the Global Citizens’ Assembly.
The numbers are stark. According to the 2026 Global Report on Food Crises, 266 million people across 47 countries experienced high levels of acute food insecurity last year, nearly double the figure recorded a decade ago.
Meanwhile, disruptions to oil, gas and fertiliser flows through the Strait of Hormuz drove a 46% month-on-month spike in urea prices early this year, sending agricultural price indices up 8% and raising the spectre of a global affordability crisis.
This is not a blip. It is a new baseline. The EAT-Lancet Commission concluded that food systems now account for roughly 30% of total greenhouse gas emissions and are the largest single contributor to the climate crisis. The science has been clear for years.
Now some of the solutions to the problem are becoming socially acceptable too.
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Earlier this year, people from more than 60 countries and territories, selected not by vested interest, but by lottery, spent seven weeks examining the evidence on food and climate for the latest Global Citizens’ Assembly. They heard from scientists, farmers and industry. They worked through 42 hours of structured deliberation, engaging with some difficult trade-offs.
They were not asked to endorse a predetermined conclusion. They were asked an open question: what changes, if any, should we make to how we grow, share and eat food, so that everyone has enough to nourish themselves while tackling the causes and impacts of climate change?
Phase down industrial animal farming
Their answer was unambiguous. They voted to protect forests. They voted to phase down industrial animal food production. They voted for supply chain reform and corporate accountability, explicitly rejecting the idea that the burden of change should fall on individual consumers. All 22 of their Calls to Action passed with over 85% support, a super-majority of randomly selected people from every region of the world, in agreement.
Consider what the assembly was actually being asked to decide. Industrial animal food production is the primary driver of tropical deforestation. Protecting more land as forest and ecosystem means less land available for the expansion of industrial production. That is a real trade-off, with real consequences for real livelihoods. Politicians have spent years avoiding it.
These randomly selected people looked at the evidence, deliberated across time zones and cultures, and chose the forests, with 64% in strong support and a further 20% in favour. People from livestock farming communities voted for change. Not because they were told to. Because deliberation led them there.
We estimate there have now been more than 7,000 citizen participation initiatives worldwide in the last decade. They have been organised because, as our 2025 report: People in the Lead demonstrated, people are now consistently and significantly ahead of politicians on issues ranging from climate to AI governance.
The people know best
What the research consistently shows is that ordinary people, given proper evidence and time, produce recommendations that are more effective and more aligned with public values than what emerges from elected legislatures. The gap in global governance is no longer primarily between science and the public. It is between citizens and their political leaders.
That gap matters for more than procedural reasons. When policy treats people as passive recipients rather than active participants, it leaves out the very actors whose behaviour, trust and consent the transition depends on. Institutions that speak only to other institutions, and negotiate only with state actors and industry lobbies, are missing out on the trust and energy of the people they are supposed to serve.
Governments, left to their own devices, are not moving fast enough to prove that argument wrong. At COP30 in Belém last November, countries failed to agree on a fossil fuel phaseout roadmap, and even full implementation of every submitted national climate plan still leaves the world on course for 2.3 to 2.8C of warming.
Citizens’ track at COP
But the Brazilian presidency grasped something important. Among the conference’s more significant outcomes was the formal launch of a Citizens’ Track within the UNFCCC process, a mechanism for connecting the global participation field to intergovernmental climate negotiations. Türkiye and Australia, who together hold the COP31 presidency in Antalya this November, now have the opportunity to strengthen and institutionalise what Brazil began.
In Guatemala, Indigenous women build climate resilience with old and new farming methods
The question before us is no longer whether citizens can contribute to solving these problems. Across the world, in local food networks, in community assemblies and in participatory planning processes, they already are, quietly generating more ambitious and more legitimate solutions than those emerging from formal diplomatic channels.
What is required now is the political courage to connect people to power. Not to consult citizens and file the results. Not to invite them to observe while the real decisions are made elsewhere. But to recognise the public as partners in perhaps the most consequential governance challenge of our time.
The post As food shocks spread, citizens are showing more leadership than governments appeared first on Climate Home News.
As food shocks spread, citizens are showing more leadership than governments
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Q&A: How will the World Bank’s abandoned finance goal affect climate action?
As food shocks spread, citizens are showing more leadership than governments
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