Businesses urged to spearhead global fossil fuel phase-out
The We Mean Business Coalition has launched a new global campaign urging businesses and governments to take bold action in eliminating fossil fuels while accelerating the adoption of clean energy solutions.
The Fossil-to-Clean campaign introduces a series of guiding principles for the cessation of fossil fuel usage, designed to empower businesses to take the forefront in combatting the global dependence on fossil fuels.
We Mean Business Coalition’s chief executive officer María Mendiluce said: “More than 80 countries rallied behind a call to phase-out all fossil fuels at COP27, but action is not happening fast enough.
“The climate and economic warnings are clear. We need immediate, decisive action on a just and equitable transition from fossil fuels to a clean energy system.”
The Fossil to Clean principles inform the strategies of oil and gas producers, corporate energy users, and financial institutions, as well as government policies.
These principles are based on UN High-Level Expert Group recommendations and use the latest models for achieving 1.5C global heating limits and net-zero emissions by 2050.
For companies consuming fossil fuels, the campaign recommends committing to phasing out unabated thermal coal and oil/gas by 2040; setting credible net-zero commitments and publishing Climate Transition Action Plans (CTAPs) with phase-out and clean energy targets; and encouraging Tier 1 suppliers to set net-zero commitments pre-2030.
The companies supplying oil and gas are advised to halt new oil and gas exploration and field development; achieve near-zero methane emissions by 2030, publish CTAPs outlining production, emissions and clean investment targets, and set science-based targets once Science Based Targets initiative (SBTi) standard is available.
The finance institutions are urged to cease funding coal and new oil/gas projects; publish CTAPs; implement timebound restrictions on existing financial flows; increase clean energy investment annually; and set science-based targets as per the 2024 SBTi standard.
Lastly, the campaign requires the governments to set phase-out targets for unabated fossil fuels in line with 1.5C; commit to 100% decarbonised power systems by 2035 (advanced economies) or 2040 (other countries); support Global South in just transition and 1.5C-aligned pathways; and redirect financial flows from fossil fuels with carbon pricing and subsidy reforms.
The Fossil to Clean campaign additionally urges governments to include fossil fuel phase-out in the final text of the upcoming COP28 climate conference in Dubai, claiming that it would provide businesses and investors with increased assurance to advance clean energy scaling efforts.
Current state of fossil fuel abatement
According to the UN, fossil fuels represent the predominant driver of global climate change, responsible for more than 75% of worldwide greenhouse gas (GHG) emissions and nearly 90% of all carbon dioxide emissions.
Fossil fuels continue to make up approximately 80% of the world’s energy provision, a proportion that has seen minimal change since the first COP in Berlin in 1995, according to data from the International Energy Agency (IEA).
In a recent survey by the We Mean Business Coalition, nearly half of business leaders (47%) anticipate phasing out fossil fuels from their companies by 2040, with 70% aiming for this transition by 2050.
However, business leaders across all sectors assert that they still encounter considerable obstacles related to commercial feasibility and infrastructure. Government regulations are viewed as the primary catalyst for the energy transition by 82% of respondents. Furthermore, 51% find regions with stricter energy laws more appealing for business.
Nevertheless, businesses are urging governments to expedite policy actions to bolster the clean energy shift.
Leading up to the recent G20 Summit in India, companies and green groups called on G20 members to adopt clear and consistent targets and policies aimed at swift private sector decarbonisation aligned with the 1.5C goal.
During the summit, the nations did agree to “pursue and encourage efforts to triple renewable energy capacity globally” by 2030, in line with the IEA recommendation. However, concerns arose over the absence of strong agreements on fossil fuel phase-outs.
© Faversham House Ltd 2023 edie news articles may be copied or forwarded for individual use only. No other reproduction or distribution is permitted without prior written consent.