At COP29, the Coal Transition Commission, co-chaired by the French and Indonesian governments, released its first report with recommendations to accelerate the coal-to-clean transition. This report is key to keeping global warming below 1.5°C, in line with climate targets.
The Commission brings together governments, international organizations, and financial institutions to address this pressing challenge.
The Need for Immediate Action
Coal remains the largest source of electricity worldwide, accounting for 36% of global generation and over 40% of energy sector emissions. To meet the 1.5°C climate goal, countries must immediately halt new coal power plant projects and fully phase out existing coal plants by 2040. Without this intervention, the continued operation of coal plants will push the world beyond 1.5°C of warming.
Although coal phase-out efforts are underway, emerging market economies and developing nations face significant challenges. These countries account for 85% of global coal demand and often have constrained fiscal positions.
They also face the task of ensuring affordable, reliable energy while growing their economies. The success of the coal-to-clean transition in these countries depends on strong domestic policies and substantial international support.
Agnès Pannier-Runacher, France’s Energy Minister said, ”The message from this report is both of urgency and hope. Urgency because accelerating coal phase-out in emerging economies will determine if we are successful in keeping 1.5°C in reach.”
She said, “Hope because there is a clear path forward to mobilise the billions that would truly match the needs, so that no country has to choose between fighting poverty and fighting climate change, as recalled in the Paris Pact for People and the Planet. Key solutions include long-term credible energy plans, expanding the involvement of multilateral development banks, innovative financing instruments and clear regulations that would mobilise private finance at scale.”
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Key Recommendations from the Report
The Coal Transition Commission’s report, Accelerating Coal-to-Clean Energy Transitions: First Report and Recommendations of the Coal Transition Commission, outlines essential steps for accelerating the global coal-to-clean transition. These include policy recommendations, financial strategies, and practical steps that governments, international organizations, and private financial institutions should take.
- Develop Long-Term Transition Plans: Governments must create clear power sector plans that phase out coal and scale up renewable energy. Strong policies should support these plans and encourage businesses, citizens, and investors to commit to the coal-to-clean transition.
- Increase Financing for Coal-to-Clean Transition: The report stresses the need to significantly increase financing for the coal-to-clean transition. Multilateral Development Banks (MDBs) should continue to provide support through technical assistance, project preparation, and catalytic capital. In addition, private finance should also play a critical role. Regulators must offer clear guidance on investments in reducing emissions from existing coal plants.
- Innovative Financing Mechanisms: To manage the high costs of transitioning away from coal, financial structures must be developed. Governments and financial bodies should explore innovative solutions, like high-integrity coal-to-clean carbon credits. These can cover transition costs and attract private investment.
- Establish a Pipeline of Priority Projects: A priority pipeline of projects must be developed, focusing on early retirement of coal plants and repurposing them for flexible uses. Collaboration and capacity building are essential to accelerating implementation, and the Coal Transition Commission will drive this work forward.
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The Role of International Collaboration
The report is the product of extensive consultations with policymakers, MDBs, international organizations, and financial experts. It is an essential tool in helping governments and financial institutions collaborate to achieve a global coal-to-clean transition.
President Macron launched the Coal Transition Commission at COP28, and the French and Indonesian governments co-chair it. Bloomberg Philanthropies supports the commission, with the Powering Past Coal Alliance providing secretarial support.
The Coal Transition Commission’s report outlines a roadmap for accelerating the coal-to-clean transition. It highlights the need for strong domestic policies and international support. Governments must act quickly to create clear plans, secure financing, and implement projects that reduce emissions. These steps are crucial for building a sustainable, low-carbon future.
The urgency of the climate crisis demands immediate action. The Commission’s recommendations provide a clear path to stay on track for the 1.5°C targets.
The full report can be read here.
