The upcoming United Nations climate conference in Dubai, known as COP28, has been marked by a notable shift in focus towards the private sector. While much attention has been given to the controversial role of the oil and gas industry, there is another sector that has steadily gained importance leading up to the conference – the renewable energy industry.
The United Arab Emirates, known for its wealth derived from oil, has not only embraced deal-making but has also actively pursued private sector investments. With this mindset, the country has strategically approached COP28, aiming to place the private sector at the heart of the conference.
Pre-conference negotiations have been a complex process, as is often the case. However, one highlight has been the widespread support for tripling the deployment of renewable energy capacity by 2030. This initiative, championed by the European Union, the U.S., and the U.A.E., has garnered backing from numerous countries.
The rationale behind this push for renewable energy is twofold. Firstly, it is essential to tackle climate change effectively. According to a United Nations “stocktake” report, scaling up renewables is described as indispensable in the fight against global warming. By tripling the output of renewable energy, significant reductions in CO2 emissions can be achieved, as stated by Maroš Šefčovič, an executive vice-president of the European Commission.
Secondly, there is a political advantage to supporting the development of a new clean energy industry rather than attempting to phase out an existing one. This creates an atmosphere of enthusiasm and opens doors for more significant commitments towards emission reduction targets.
During a COP preparatory meeting in Abu Dhabi, a collaboration between governments and the renewable energy industry was highlighted as crucial to charting a path forward. The International Renewable Energy Agency (IRENA), representing over 160 countries, along with the Global Renewables Alliance, an industry group encompassing thousands of companies, presented a roadmap developed in partnership with the COP presidency.
While the message conveyed by the coalition was fundamentally optimistic, they emphasized that substantial work lies ahead. Countries need to restructure their electricity sectors, bolster clean technology supply chains, and provide comprehensive training for workers. Additionally, an average investment of $1.3 trillion per year globally by 2030, including in riskier emerging markets, is necessary. Achieving this requires substantial reforms in international finance, as noted by Francesco La Camera, the head of IRENA.
It is important to recognize that public support for renewables, particularly in the U.S., has predominantly relied on subsidies. However, the coalition’s primary focus is not simply diverting subsidies from fossil fuels to renewables. Instead, they emphasize crucial technical fixes. Governments can reform the purchasing and selling of electricity to accommodate more renewable energy, while revised permitting measures can expedite the realization of renewable energy projects.
What sets COP28 apart is the increasing involvement of the private sector. While the COP process traditionally revolved around negotiations between governments, the urgency to fast-track projects has placed even greater significance on the role of businesses. Conference organizers are actively pushing this agenda, acknowledging that it will be the private sector, with its investment, risk-taking, and implementation capabilities, that will ultimately drive the deployment and operation of renewable energy capacity.
COP28 in Dubai showcases a notable shift towards the private sector, with the renewable energy industry taking center stage. Support for tripling renewable energy deployment by 2030 is gaining traction, underpinning the urgent need to combat climate change while simultaneously creating new economic opportunities. By recognizing the central role of the private sector, COP28 aims to foster collaboration between governments and businesses to achieve ambitious climate goals and transition to a cleaner, more sustainable future.
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