The U.S. Department of State, together with the Bezos Earth Fund and The Rockefeller Foundation, revealed the foundational framework of the Energy Transition Accelerator (ETA).
This innovative carbon finance platform aims to mobilize private capital to support ambitious and equitable energy transition strategies in developing and emerging economies.
During the launch event at the U.S. Center at COP28, the three ETA partners highlighted major achievements since the initiative’s inception at COP27 one year ago.
Their objective is to formally establish the ETA as an independent initiative by Earth Day 2024.
The ETA seeks to unite governments and private sector stakeholders, leveraging high-integrity carbon crediting to expedite greenhouse gas reductions by transitioning from fossil fuels to clean power in developing and emerging economies.
Preliminary estimates suggest that the ETA could mobilize between $72 billion to $207 billion in transition finance by 2035.
Pioneering a sectoral-scale crediting approach, the ETA incentivizes participating countries to intensify near-term activities contributing to power sector decarbonization.
This includes deploying clean power, retiring fossil fuel assets, enhancing storage capacity, transmission, and distribution, and making necessary policy shifts.
The core framework lays the groundwork for the ETA Coalition, defining its objectives and providing an overview of key elements, including:
– An approach to carbon crediting, featuring the development of an independent sectoral-scale crediting standard for emissions reductions from electricity generation.
– Criteria for participating companies and how they would use ETA carbon credits to meet voluntary climate commitments.
– Just transition provisions addressing worker and community needs.
– Plans to allocate a portion of generated finance to enhance adaptation and resilience in vulnerable countries.
– Options for innovative financial structures to attract investment into energy transition strategies.
Countries and leading companies expressed their interest in engaging with the ETA partners during the development of this groundbreaking initiative. The governments of Chile, the Dominican Republic, and Nigeria announced their participation as pilot countries.
Nine prominent companies, including Bank of America, Boston Consulting Group, Mastercard, McDonald’s, Morgan Stanley, PepsiCo, Salesforce, Standard Chartered Bank, and Schneider Electric, signed a letter of interest, recognizing the ETA as an opportunity to support large-scale power sector transformation and accelerate progress towards ambitious climate goals.
Extensive input from a High-Level Consultative Group of over 30 experts and leaders, supported by organizations such as the Center for Climate and Energy Solutions (C2ES), the Environmental Defense Fund (EDF), the Climate Policy Initiative (CPI), and the Glasgow Financial Alliance for Net Zero (GFANZ), contributed to the design effort of the ETA.
