Summary provided by members of our ESG team; Nicola Leuratti, Senior Analyst, and Charlotte Dyvik Henke, Consultant.
Day 2 of COP 28 saw the opening day of the World Climate Action Summit (“WCAS”), where global and international leaders expressed their firm commitment to achieving the Paris Agreement goals, particularly considering concerns that the 1.5°C warming limit is becoming increasingly unattainable. Key topics included tripling renewable energy capacity, doubling efforts in energy efficiency, and actively phasing down the use of fossil fuels.
WCAS highlighted key challenges in infrastructure developments, the high risk involved in private investing, as well as remaining deficits in financing for climate strategies in developing markets. It has also cited the need for robust and widespread carbon markets and carbon taxes for high polluters.
The COP28 presidency unveiled Alterra, a $30 billion catalytic climate fund, establishing it as the world's largest private investment vehicle dedicated to climate action. In collaboration with partners such as BlackRock, TPG, and Brookfield, the initiative aims to steer private markets toward climate investments, with a special emphasis on transforming emerging markets and developing economies.
Delegates have stressed the importance of multi-stakeholder partnerships for climate finance, fast- tracking energy transitions and strengthening local resilience, with a particular focus on emerging economies.
COP28 President, Al Jaber’s, controversial comment to advocate for phasing-down instead of phasing out fossil fuels has sparked serious concerns about the ambition levels for this year’s COP28 final agreement. It remains to be seen whether the already more than 100 countries that support a phase-out will be able to push ambitions higher.
Meanwhile, the addition of the Local Climate Action Summit this year places much-needed emphasis on subnational climate efforts. With the landmark agreement of the Loss and Damage Fund, securing $420 million in funds on the first day of COP28, and numerous other private funding initiatives, there is an ever-increasing focus on accelerating funds for the climate transition. Ensuring these measures are adapted to local contexts is important for sustainable implementation. World leaders must continue to be in the room to achieve action at the scale needed.
