Axios House at COP28: Achieving a Low Carbon Future through Collaboration

The big picture: Countries are implementing climate policies to enact incentives for companies to develop clean energy infrastructure. At an Axios House event in Dubai for COP28, private sector leaders and climate experts gathered to discuss the ways industry collaboration can help achieve a low carbon future.

Zoom in: On Dec. 4, Axios senior climate reporter Andrew Freedman and 1 big thing host/editor Niala Boodhoo hosted conversations with VCMI executive director Mark Kenber, and Citi chief sustainability officer Val Smith.

Why it matters: As more extreme weather events occur, companies and governments are urgently looking for ways to expedite and meet net zero goals and deal with the drastic impacts of climate change.

Kenber highlighted the need for carbon market solutions:

• "We need the carbon finance and where's it going to come from? It's from the corporate sector. The corporates who need to be responsible for their greenhouse gas emissions and can do that by investing… in carbon reduction removal projects. It doesn't solve the problem long term, but it does solve a big part of the problem in the short term."

Kenber also shared his outlook on the standard setters coming together to discuss voluntary carbon markets at COP28:

• "I think it's the beginning of a win. We've qualified for the Olympics. We haven't won the medal yet, but we have to qualify first. And we're being supported by people from almost every sector of society indigenous peoples, local community, global South governments, global North governments, an increasing number of non-government organizations. And importantly, because they're going to be investing in this, corporates. So we've got the foundations and we've got the foundations right."

Smith detailed the biggest challenge for banks, like Citi, trying to support clients seeking to decarbonize their business models:

• "I think the big challenge is that we have to move a lot more quickly in the economy than we had before. And we know that, you know, there's a tremendous, tremendous amount of urgency. So I would say a couple of years ago, the market for climate finance didn't feel as promising as it feels today."

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Rebecca Kujawa, president and chief executive officer of NextEra Energy Resources, explained the impact of the Biden administration's Inflation Reduction Act:

• "We were thrilled with the IRA, not just because of the extension of the incentives, but for the long term visibility that these incentives now provide…In the history of the renewable sector in the U.S., we've had a boom and bust cycle of the tax credits favorable and that they kept getting extended, but challenging in the sense that if you didn't have long term visibility and you're someone in the supply chain needing to make big capital investments in manufacturing, you didn't have the confidence that you now can have that renewables will continue to be a huge part of the growth opportunity in the electricity sector so that long term visibility is a real game changer."

Thank you to NextEra Energy for sponsoring this event.