ENERGY TRANSITION TO CARBON NEUTRALITY: THE ROLE OF PUBLIC AND PRIVATE SECTORS

Abstract

This paper highlights the necessity of energy transition to carbon neutrality as a response to climate, geopolitical, economic and energy crises. Achieving the ambitious goals of carbon neutrality requires effective international, public and private sector cooperation. Public sector should play a decisive role and lead in shaping and creating markets for sustainable green growth. In order to achieve carbon neutrality, public sector should define ambitious clear goals, mobilize and coordinate long-term sufficient sustainable financing, stimulate the development and spread of green technologies/ practices by incorporating private sector and civil society. Cooperation and productive relations between public, private sectors and civil society are vital to ensure ambitious decarbonization of global economy. The priority of just transition, considering the social and economic consequences for vulnerable regions, groups of people – should be an integral part of carbon neutrality policy. Private investors and businesses should also respond to climate change by adapting their investment and business strategies due to government regulation and guided by own initiative in order to obtain profits, gain long-term competitive advantages and avoid climate risks in the future. The EU's carbon neutrality policy can serve as a model with well-developed and effectively implemented programs with clear goals and well-provided investments on the scale required to decarbonize EU economies. EU simultaneously transform various sectors of the economy by effectively incorporating private sector and civil society. Implemented justice mechanism is a key tool to ensure that the transition towards a climate-neutral economy happens in a fair way, leaving no one behind in the most affected regions. Private sector shares the EU’s carbon neutrality goals by adapting its practices and strategies. EU leads in sustainable financing and practices (like in reporting – the Task Force on Climate-related Financial Disclosures) among other world regions. Ukraine as a candidate for EU membership should share the values and goals of the EU in terms of climate and energy policy and adopt successful practices in the field of regulation, stimulation and in formation of decarbonization funds. Carbon neutrality policy should be at the core of Ukraine's economy recovery and development strategy after the war.