New Report From IEA And GenZero Examines The Roles Of Carbon Credits, Public And Private Funding For Reaching Net Zero

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GenZero – a global investment firm headquartered in Singapore and the International Energy Agency have issued a joint report exploring how carbon credits could facilitate the development of novel approaches that reduce or remove emissions from the atmosphere. 

The report titled: The Role of Carbon Credits in Scaling Up Innovative Clean Energy Technologies looks into three approaches that are in need of a rapid scale in order to make a dent in emissions such as direct air capture and storage, low-emissions hydrogen, and sustainable aviation fuels (SAF).

Relevant: GenZero Launches Paper To Enhance Legal Clarity For Voluntary Carbon Credits In Singapore

The report states that by the early 2030s, annual investment of $4.5 trillion is needed per year to accelerate deployment across all clean energy technologies and infrastructure, up from $1.8 trillion in 2023.

Investment pathways are explored that can bridge the gap towards development as carbon credits are not able to fund the technologies deployment on their own. Carbon credits are seen as an enabler of attracting private capital and accelerating technology adoption while governments can unlock investment through a mix of policies and financing instruments. As the report concludes, governments and the private sector need to develop strategies to create the right environments. 

Relevant: GenZero Launches With $3.6 Billion Investment From Temasek

“Our analysis shows that low-emissions hydrogen, sustainable aviation fuels and direct air capture all have crucial roles to play if we are to limit global warming to 1.5 °C, but for the moment the underlying economics are challenging… Carbon credits cannot bridge the investment gap on their own, but our new joint work with GenZero underscores how well-designed and credible crediting mechanisms can get projects moving by improving revenues and bankability,” commented Tim Gould, Chief Energy Economist of the IEA. 

“While costs will eventually come down and technology will mature, will it happen fast enough to avert a looming climate crisis? We need to accelerate adoption by catalysing more investments and financing into these areas,” also shared Frederick Teo, CEO of GenZero.

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