Back in October 131 companies, worth a combined $1 trillion in revenue, joined in the Fossil to Clean campaign, sending a letter to urge the heads of state attending COP28 to commit to a full phase-out of unabated fossil fuels, a tripling of renewable energy and a doubling in the pace of energy efficiency reforms………

Dear Heads of State attending UNFCCC COP28,

We, the undersigned companies representing $987 billion in global annual revenue, celebrate the exponential growth of solutions that have made clean energy cheaper and more accessible than ever before. However, global emissions continue to rise because we haven’t addressed the primary cause of climate change: the burning of fossil fuels.

Our businesses are feeling the impacts and cost of increasing extreme weather events resulting from climate change. We recognize the need to transition in a way that safeguards our future collective prosperity on a liveable planet. That means reducing our emissions, adopting clean solutions and reducing our use of fossil fuels to limit global heating in line with the Paris Agreement’s ultimate goal of 1.5°C.

As energy purchasers and users* in the global system, we have an important role to play in sending a clear signal about our future energy use, which is rapidly becoming cleaner through renewables. We are taking action and working toward phasing out our use of fossil fuels. That is why we are setting science-based targets, developing climate transition action plans, investing in net-zero solutions and disclosing our progress. Climate action is good for business now and in the future.

To decarbonize the global energy system, we need to ramp up clean energy as fast as we phase out the use and production of fossil fuels. This means turbocharging the renewables revolution, electrifying key sectors and massively improving efficiency — thereby creating the conditions for a rapid, well-managed and just transition away from fossil fuels. The transition to net zero could boost global GDP by 4% by 2030***.

But we cannot make this transition securely or efficiently alone. Financial institutions, fossil fuel producers and governments all have crucial roles to play.

We urge:

• Financial institutions to work collaboratively with us, and with policymakers, to ensure that capital is being allocated to accelerate the clean energy transition — creating a financial system that safeguards future growth and returns for people and planet.
• Fossil fuel producers to join us in setting science-based, net-zero targets and to develop and publish transition plans on short- and long-term steps to decarbonize business operations, products and services. This includes shifting investments away from fossil fuels and toward clean energy to halve GHG emissions by 2030 and enable a net-zero global energy system by mid-century.
• Governments to set the enabling conditions, policies, regulations and investments for a just clean energy transition. The decisions made today are critical to protect people and ensure a livable, healthy and prosperous future. Policy certainty will allow businesses to develop affordable and reliable near-term alternatives to fossil fuels for their operations and supply chains.

We call on all Parties attending COP28 in Dubai to seek outcomes that will lay the groundwork to transform the global energy system towards a full phase-out of unabated**** fossil fuels and halve emissions this decade. This can be enabled by agreeing to a global target of tripling renewable electricity capacity to at least 11,000 GW and doubling the rate of deployment of energy efficiency by 2030.

In support of the above, we urge all governments to:

• Set targets and timelines for the phase-out of unabated fossil fuels in line with 1.5°C, supported by national plans and policies to ensure a just transition for affected workers and communities. Wealthier countries have the responsibility to be first movers and support other countries in their efforts.
• Accelerate the clean energy transition by committing to reach 100% decarbonized power systems by 2035 in advanced economies, and by 2040 for other countries, at the latest.
• Support countries in the Global South in diversifying their energy systems and developing 1.5°C-aligned economic pathways, including through the provision both of finance that does not exacerbate unsustainable sovereign debt, and of capacity-building for just transition planning. This must be part of a broader alignment of public and private financial flows with the objective of an equitable global phase-out of fossil fuels.
• Ensure clear pricing signals through a meaningful price on carbon that reflects the full costs of climate change — and reform and repurpose fossil fuel subsidies toward energy efficiency, renewable energy and other measures to support a people-centered and equitable clean energy transition.

Leadership from policymakers, alongside coordinated actions from finance and fossil fuel producers, will enable us, as energy users, to develop and deploy the climate solutions of the net-zero economy.

We stand ready to support and work with you on the path away from fossil fuels, and toward healthier and more resilient communities, sustainable economic growth and shared prosperity.

*Inclusive of power generators
**IEA
***IPCC AR6 WG3 2022. “Unabated fossil fuels refers to fossil fuels produced and used without interventions that substantially reduce the amount of GHG emitted throughout the life-cycle; for example, capturing 90% or more from power plants, or 50-80% of fugitive methane emissions from energy supply.” Storage must be on a geological timescale. WGIII Summary for Policymakers Headline Statements (ipcc.ch).

Reuters has since reported that the signatories are worried for the prospects of COP28 because of the lack of consensus over priorities and the increasing political polarisation.  Businesses are hampered by a lack of incentives and policies to support decarbonisation. 38% of respondents in a survey of 1,000 business leaders said they could not afford to decarbonise in the current environment: “One thing is clear: the business case for low-carbon investments is often weak, and businesses are looking for government to help create the market incentives to change that,” said Katherine Dixon, partner at consultants Bain & Company.

The business and finance sectors have long called for a global carbon emissions price that they say would level the playing field and make the switch to low-carbon more cost-effective, as has the IMF.

As stated in the Fossil to Clean campaign’s letter governments need to ensure ‘clear pricing signals through a meaningful price on carbon that reflects the full costs of climate change’.