Building a Cleaner Future: Financing the Coal-to-Clean Transition

In this opinion piece, Mike Hayes, Global Climate Change and Decarbonization Leader at KPMG, argues that the Coal-to-Clean Initiative has the potential to revolutionize the transition from coal-powered energy to renewable energy in emerging markets. This initiative seeks to fund the early retirement and repurposing of coal-fired power plants. Hayes emphasizes that emerging economies, which account for 65% of the global population but receive only 15% of clean energy investments, face unique challenges in achieving economic growth while addressing climate goals. By engaging a broad coalition of banks, corporations, philanthropies, and development banks, the initiative aims to provide scalable financing solutions that align with just energy transition objectives, maintaining energy capacity while reducing the environmental impact of coal.

Drawing on reflections from COP29 in Baku, Hayes expresses cautious optimism about the growing role of businesses in driving climate action despite record global fossil fuel use in 2023. While renewable energy capacity is forecasted to nearly triple by 2030, he stresses that achieving this goal will not be straightforward. Hayes calls for more coordinated efforts to address the financial gaps hindering the transition in emerging markets. The World Economic Forum’s Annual Meeting in Davos is highlighted as a critical moment to advance this agenda, with tools like the Coal-to-Clean Toolkit and Decision Tree offering actionable roadmaps for transformative change.

Hayes concludes by underscoring the urgency of aligning global efforts to limit warming to 1.5°C, calling for bold decisions from both public and private sectors. He asserts that business leaders must not remain spectators but instead take active roles in shaping a sustainable future. By fostering partnerships, providing clear market incentives, and scaling impactful coal-to-clean programs, the initiative aims to create an equitable energy transition that leaves no one behind. This piece advocates for a collaborative approach to address one of the most pressing challenges of our time.