Rewatch the Initiative's webinar at Climate Week NYC

In September 2024, as part of Climate Week NYC 2024, the Initiative for coal regions in transition hosted a webinar on "Mobilising finance for regional just transitions from coal". Although country-specific contexts differ, coal regions around the world face similar challenges in their attempts to secure and leverage private, development, and other sources of finance to support their transitions away from coal, while also ensuring justice for vulnerable groups and communities.

Alongside interventions from the public, private, and civil society sectors, the event featured three case studies of innovations from both developed and developing countries, offering insights into practicalities and lessons learnt from existing financing transactions, tools, and mechanisms.

Key reflections from the session include:

Investment from the private sector

There is a need for greated private sector investments in just transitions – constrained public budgets cannot, and should not, bear the full cost of the investments needed to achieve a just transition in coal-dependent and other climate-vulnerable regions and communities. Mobilising private finance can be achieved without significant public investment – by leveraging sought-after public resources, such as grid access. This was highlighted in the case study of the Just Transition Tenders in Spain, where grid access was tendered on a socioeconomic basis to maximise the just transition benefits of selected projects.

Justice as a guiding principle

Energy justice principles can reshape how we allocate risk, reward, and responsibility among the public, private, and civil society sectors. Integrating energy justice principles (including distributive, procedural, restorative, recognitional and cosmopolitan justice) into policy and investment frameworks, can alter relationships between governments, companies, and civil society. In Asia, for instance, the justice element is not yet fully embedded in climate and energy planning and policymaking – with the need for timebound transition strategies from governments and the finance sector, increased renewable energy to support a faster and fairer transition, and genuine civil society engagement.

Systemic limitations

Sustained and scaled financing of just transition activities faces both broad financial ecosystem challenges as well as project-level specific barriers. In South Africa, recommendations for a just transition financing mechanism include various interventions to address these barriers, from project assessment to matchmaking, supporting small businesses, aligning public finance, socialising just transitions in the private sector, and promoting the transition within the finance sector.

Examples to inspire

A growing number of successful coal transition mechanisms provide replicable models for financing the early retirement of coal-fired power plants in both developed and developing countries. Examples from Chile and the Philippines demonstrate distinct approaches to raising funds to support the early retirement of coal plants, while also linking these transactions to increased renewable energy investment.

Rewatch the full recording of the event here.