Climate Smart Ventures to co-lead global initiative to spur the transition from coal to renewables
November 11, 2021
On 4 November 2021, the European Climate Foundation (ECF), Climate Smart Ventures (CSV), Carbon Trust, RMI and International Network of Energy Transition Think Tanks (INETT), with the support of the IKEA Foundation and the Growald Climate Foundation launched a new global initiative called the Coal Asset Transition Accelerator (CATA) at the 26th United Nations Climate Conference (COP26).
CATA shall engage core audiences (countries, financial institutions, investors, donors, and other stakeholders) in service of high-priority objectives that advance an accelerated coal transition. Elizabeth McKeon, Head of Climate Action Portfolio at the IKEA Foundation, said, “This is critical if we are to minimise the impacts of climate change and protect the planet for children and families everywhere.”
Lawrence Ang, Managing Partner of CSV, says “Climate Smart Ventures is proud to be part of CATA and is ready to learn and dialogue, as well as share its knowledge and insights in accelerating the shift to net-zero, driven by principles of a just and orderly energy transition. Together with our partners, CSV is eager to support a growing list of private and public sector leaders to make the shift today in ways that create sustainable value.”
Clean energy is at an economic tipping point globally. As highlighted at COP 26, new renewables and energy storage will be able to cost-effectively replace about 80% of existing coal power by 2025. CATA arrives at this critical time ready to support key local stakeholders – governments, utilities, financiers, and civil society organisations – with innovative analysis, leading expertise, and a range of tools and resources to make the transition from coal to clean energy in an equitable, orderly, and practical way.
Laurence Tubiana, President and CEO of the ECF, said “What is clear is that economics and climate policy alone will not take coal off the system as quickly as the climate science urges and that financial mechanisms that respect regional and local context and take into account just transition are key”.
CATA’s goal is to help overcome these barriers through well-designed financial and non-financial mechanisms, policy and regulation to enable a faster, smoother and more equitable energy transition. In doing so, CATA is initially focusing on regions that are already intensively engaged in the energy transition, such as South Africa, Indonesia and the Philippines.
The new platform also seeks to track and learn from leading countries and organizations as they launch and implement their coal transition mechanisms, including securitization in the United States, the Climate Investment Funds Accelerating Coal Transaction Investment Program, and the Asian Development Bank’s Energy Transition Mechanism.
Ensuring a just transition is central to CATA’s mission and goals. In addition to providing necessary resources to stakeholders, CATA will seek their input in developing guiding principles for the coal phase-out. One of these principles is that financial mechanisms should fairly distribute costs, benefits, risks, and opportunities to ensure fair and equitable outcomes for key stakeholders, especially those most at risk.