GENEVA , - A new project in which U.S. President Joe Biden has lauded companies as supporting low-carbon technology development through their purchasing power amounts to a "big transformative" U.S. climate envoy John Kerry stated Thursday.
The U.S. government spearheaded the " First Movers Coalition" to meet the increasingly difficult goal set out in 2015's Paris climate agreement to limit global warming at 1.5 degrees Celsius. Nearly three dozen companies from many industries have already committed to changing their purchasing habits to support zero-emission technologies development by 2030.
It is intended to stimulate budding technologies or not-yet existing technologies that can lower the amount of CO2 spewed into our atmosphere. This is done by leveraging the market, specifically the purchasing power and buying power of companies. Then they encourage their suppliers to do the same. Biden described the project at the U.N.-backed Climate Conference in Glasgow, COP26.
"This is a huge transformation. Kerry spoke to many corporate leaders in Glasgow about Thursday's big transformation. "Everyone I have spoken to who has heard about it says: "Wow, that makes sense. It's amazing. And you all understood it instinctively and without any arm-twisting.
The project's designers claim that half of the reduction in emissions between now and 2030 will come from innovation, such as capturing carbon from the air. The idea is that suppliers of large companies should be encouraged to reduce CO2. This will create more markets and eventually lower costs.
Kerry stated, "If we don’t get enough reduction somewhere around the 45% range in the next 10 years we are blowing by 1.5 degree -- and that’s a difficult target." He also credited the private sector with leading "in ways that even some governments aren't."
The first phase will focus on shipping, steel, trucking and aviation. Three additional industries, aluminum, cement, and chemicals, will be added later. According to WEF, these seven industries account approximately one-third global carbon emissions.
Kerry stated that Volvo said it would buy 10% -- X% of its vehicles with green steel. "And so, suddenly, people who make green steel know that there is someone out there looking to buy it."
Participating companies don't have to change their plans immediately. They can commit to making changes in at most one of their buying areas, but not necessarily across the company.
There are still questions about the monitoring and metrics, which could be considered "greenwashing", if companies try to secretly renege on their commitments.
Borge Brende is the president of the Geneva-based WEF. He stated that "we are going to have very specific metrics and strict follow up on this." The WEF is well-known for organizing the annual conference in Davos, Switzerland, of corporate and government leaders.
He said, "Rest assured. We're on it," in a telephone interview.
The initiative does not replace government regulation to curb global warming. He also said that putting pressure on suppliers could cause companies to pay higher prices. Brende stated that the idea is based on existing commitments in finance, such as carbon-reduction strategies at investment firms like Blackrock or Carlyle.
This coalition hopes to expand that effort in finance to more sectors. U.S.-based firms such as Amazon, Apple and Delta Airlines are participating, along with European plane maker Airbus and German energy company Vattenfall, and India's Dalmia Cement.
Brende stated that this means they will be quite tough, even in the difficult-to-abate sector, in the coming years. Brende was referring to those sectors where cutting carbon is particularly difficult. You must reduce your carbon footprint if you wish to sell to these companies. That signal will be heard, and I am certain it will lead technology breakthroughs.
