Kerry announces proposed public-private carbon market for developing countries
US climate envoy John Kerry on Wednesday officially announced the Energy Transition Accelerator, a public-private partnership aimed at developing carbon markets to transition developing countries away from fossil fuels with private funds.
In remarks at the UN COP27 climate summit in Egypt, Kerry said the proposed initiative will involve private capital in partnership with governments and NGOs to facilitate the transition to renewable energy. The former secretary of state described conversations with world leaders in which they identified money as the main obstacle to the transition.
“Rich countries are stepping up their support. Our administration is working as hard as we can to deliver on President Biden’s pledge to quadruple US climate support by 2024. We are absolutely committed to doing our part,” Kerry said in remarks Wednesday. “But no government in the world has enough money to do this job. We will only succeed with a massive injection of private capital.
Kerry, who has often spoken of the need for private sector cooperation on decarbonization goals, said the initiative could trigger a snowball effect by convincing other funding sources of the opportunities presented by the transition. Another possibility, he said, is to allow companies involved in the program to use a limited amount of credits for their own short-term emissions reduction goals. “And companies would acquire additional credits to go beyond their targets – to achieve a higher overall level of emissions reductions,” he added.
Carbon credits have been a controversial concept among environmentalists and policymakers, with some calling them “green money” that allows companies to mislead about their environmental impact. In a statement on Wednesday morning, international NGO ActionAid denounced the announcement as an “exhausting talking point”.
Kerry was first confirmed that he plans to make an announcement on the proposal earlier this week.
“Carbon markets are not climate finance. Secretary Kerry keeps saying that public finances alone won’t be enough to meet our climate goals, but no one is actually claiming that. Now is the time for the United States to take responsibility for its contribution to climate injustices,” Action Aid senior policy analyst Kelly Stone said in a statement.
“Carbon markets have historically failed to achieve climate goals and often deeply harm communities and violate human rights. The Secretary’s assertions that this time will be different are not enough,” she added.