Engaging the Business Community at COP29 - Clean Energy
A new IEA report finds that the global market for key clean technologies is set to triple to more than $2tn over the coming decade as energy transitions advance. It highlights the deepening connections between energy, trade, manufacturing and climate. As COP29 approaches, we address the importance of engaging the private sector in tackling challenges presented by climate change.
The rise of clean energy technology
The International Energy Agency’s (IEA) Energy Technology Perspectives 2024 report (ETP) published today (30 October) focuses on the deepening interconnectedness of energy, industry and trade.
According to the report, the rapid uptake of clean energy technologies offers major opportunities for countries looking to manufacture and trade them, but at the same time presents challenging decisions for governments, which face tensions and trade-offs based on the industrial and trade policies they opt to pursue.
ETP focuses on the outlook for the top six mass-manufactured clean energy technologies: solar PV, wind turbines, electric cars, batteries, electrolysers and heat pumps. Based on current policy settings, the global market for these technologies is set to rise from $700bn in 2023 to more than $2tn by 2035. Trade in clean technologies is also expected to rise sharply. The outlook suggests that it more than triples in the next decade to reach $575bn, more than 50% larger than the global trade in natural gas today.
“The market for clean technologies is set to multiply in value in the coming decade, increasingly catching up with the markets for fossil fuels. As countries seek to define their role in the new energy economy, three vital policy areas – energy, industry and trade – are becoming more and more interlinked. While this leaves governments with tough and complicated decisions ahead, this groundbreaking new IEA report provides a strong, data-driven foundation for their decisions,” said IEA Executive Director Fatih Birol.
“Clean energy transitions present a major economic opportunity, as we have shown, and countries are rightly seeking to capitalise on that. However, governments should strive to develop measures that also foster continued competition, innovation and cost reductions, as well as progress towards their energy and climate goals.”
The crucial role of private sector engagement for boosting clean energy technology
The report highlights the importance of a strong innovation ecosystem, and its ability to bring benefits to investors and, for emerging technologies in particular, its influence over investment decisions. A predictable, stable and effective regulatory and political environment increases the attractiveness for investors and boosts confidence in new clean energy supply chain infrastructure. It notes that private sector innovation is spurred by expectations of growing markets and the policies that support them. Further, the IEA industry survey highlights public funding or financial support for innovation are an important driver of private investment in innovation for clean energy technologies.
Well-designed industrial strategies are conducive to the success of the transition to clean energy. According to ETP, long-term government strategies, integrated into overall energy, climate and industrial policy and system planning is a key principle when designing these strategies. As part of this, medium term milestones are required to heighten credibility and ensure the support of the private sector. Thus, the perspective of businesses and investors cannot be undermined.
The convening power of COP29
As COP29 fast approaches, its power to bring together governments, businesses, civil society and international organisations to address the urgent challenges of climate change must be put into full force. It will mark the first COP since the UAE Consensus was agreed, containing the goal of tripling renewable energy capacity by 2030. It will also be the last major gathering before the next round of NDCs (NDCs 3.0) due to be submitted by February 2025, which must reflect the level of ambition set out by the Parties at COP to drive all stakeholders to intensify their efforts aligned with national goals.
The Climate Action Innovation Zone across its three flagship events – Sustainable Innovation Forum (SIF), Hydrogen Transition Summit (HTS), and Agri-Food Systems Summit (AFSS)– integrates the voice of the private sector amongst the high-level themes set out by the COP29 Presidency.
Over three days, 13-15 November, a variety of industry leaders will take the stage alongside stakeholders from government, inter-governmental organisations and non-governmental organisations.
At the Sustainable Innovation Forum, Erich Labuda, President of Motion Services Division ABB; Mike Train, Chief Sustainability Officer at Emerson; and Takajiro Ishikawa President and CEO Mitsubishi Heavy Industries America, will represent the private sector and lay out the public-private partnerships that are driving the rapid deployment of cutting-edge clean energy on the second panel of the Forum, Powering the Future: Rapid scaling of clean energy for stability and resilience. Alongside them, Damilola Ogunbiyi, UN Special Representative and CEO for Sustainable Energy for All, and Erik Solheim, Champion of the Global Renewables Alliance, will provide their holistic view as international organisations working to accelerate the deployment of renewable energy solutions.
To see the Climate Action Innovation Zone’s full agenda and to register, please visit: Climate Action Innovation Zone
