What You Need to Know.

  • With a focus on multilevel action, urbanization, and the built environment and transport, the events of Day 7 of COP28 highlighted efforts to transition to low-carbon and resilient infrastructure, particularly in urban areas.  This thematic focus is significant; according to the UN Environmental Programme, cities are responsible for an estimated 75 percent of global CO2 emissions, primarily from transportation and buildings.

Why This Matters for Businesses.

  • Decarbonizing the transportation sector is a critical component of the energy transition.  As reported at the 2021 United Nations Sustainable Transport Conference, the transportation sector is responsible for approximately one quarter of greenhouse gas emissions and is the largest source of energy-related emissions for 45 percent of countries.  Accordingly, countries have begun making significant investments in programs and incentives designed to decarbonize surface transportation.
  • This trend holds true in the United States, where the transportation sector accounts for 29 percent of total U.S. GHG emissions.  The 2021 Bipartisan Infrastructure Law includes more than $27 billion in funding for carbon pollution reduction projects, including the National Electric Vehicle Infrastructure program, which provides $5 billion to states to develop a national electric vehicle charging network, and the Low or No Emission Vehicle Program, which provides $5 billion to replace transit buses with zero-emission electric buses.  Similarly, the 2022 Inflation Reduction Act provides tax credits to purchase qualifying electric vehicles and the development of sustainable aviation fuels, among other clean energy programs. 
  • The European Union and its Member States, where transport emissions represent around 25 percent of total EU GHG emissions, also have various programs and individual support mechanisms in place to decarbonize the transportation sector.  Examples include Important Projects of Common European Interest in the hydrogen technology value chain or in batteries (HyTech, allocating €5.4 billion to thirty-five companies, first and second IPCEI on batteries granting €6.1 billion to fifty-nine participants), the InvestEU Fund, and the Innovation Fund.  Business leaders should continue to review and monitor these U.S. EU, and incentives and funding announcements provided by other authorities to best take advantage of the market opportunities created by these programs.
  • While the nature of COPs emphasizes the importance of national-level negotiations, subnational leaders play a key role in driving climate action.  And in many cases, it is subnational leaders that are responsible for implementing national-level climate action programs.  Earlier in the week, subnational leaders, including mayors and governors and partner organizations from around the world, gathered at the first-ever Local Climate Action Summit to discuss the role and importance of local leaders in reducing emissions and addressing climate risk.  Businesses should actively engage and develop relationships with local leaders to identify areas where they can partner on climate action.

Covington Commentary.

“Government-sponsored programs and tax incentives create significant opportunities for businesses to contribute to the energy transition and expand their reach into new markets.  The global action on decarbonizing transportation and urban areas at COP28 underscores the importance of these sectors and the promise of continued public-private action in this space.” 

Lindsay Brewer, Associate, Environmental Practice Group

More News and Developments.

Covington’s multidisciplinary COP28 delegation includes leaders of Covington’s ESG, Environment, Energy, Project Development and Finance, Corporate, and Public Policy practices, as well as our unique Carbon Management and Climate Mitigation (CM2) initiative. Our comprehensive and integrated global team is ready to assist clients as they prepare for COP28, engage with key stakeholders while there, and then strategize about and successfully implement ESG corporate policies aligned with COP28 goals.  Follow our Climate Hub for Businesses to stay up to date with the latest developments from COP28.

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Bradford McGann

Bradford McGann is an associate in the firm’s Washington, DC office, where he provides strategic advice to clients as a member of the firm’s Environmental and Energy Practice Group, the Environmental, Social, and Governance (“ESG”) Practice, and the Carbon Management and Climate Mitigation…

Bradford McGann is an associate in the firm’s Washington, DC office, where he provides strategic advice to clients as a member of the firm’s Environmental and Energy Practice Group, the Environmental, Social, and Governance (“ESG”) Practice, and the Carbon Management and Climate Mitigation industry group. Bradford’s work focuses on helping clients understand and navigate multijurisdictional climate-related financial disclosure requirements. He also provides regulatory compliance support for clients engaged in carbon-reduction, renewable-energy, and net-zero efforts. His pro bono practice focuses on issues of immigration and international human rights.

Photo of Lindsay Brewer Lindsay Brewer

Lindsay advises clients on environmental, human rights, product safety, and public policy matters.

She counsels clients seeking to set sustainability goals; track their progress on environmental, social, and governance topics; and communicate their achievements to external stakeholders in a manner that mitigates legal…

Lindsay advises clients on environmental, human rights, product safety, and public policy matters.

She counsels clients seeking to set sustainability goals; track their progress on environmental, social, and governance topics; and communicate their achievements to external stakeholders in a manner that mitigates legal risk. She also advises clients seeking to engage with regulators and policymakers on environmental policy. Lindsay has extensive experience advising clients on making environmental disclosures and public marketing claims related to their products and services, including under the FTC’s Green Guides and state consumer protection laws.

Lindsay’s legal and regulatory advice spans a range of topics, including climate, air, water, human rights, environmental justice, and product safety and stewardship. She has experience with a wide range of environmental and safety regimes, including the Federal Trade Commission Act, the Clean Air Act, the Consumer Product Safety Act, the Federal Motor Vehicle Safety Standards, and the Occupational Safety and Health Act. Lindsay works with companies of various sizes and across multiple sectors, including technology, energy, financial services, and consumer products.

Photo of Carole Maczkovics Carole Maczkovics

Carole Maczkovics has developed a cutting-edge expertise in State aid law, with a strong background in the economic regulation of network industries (energy and transport) and in public contracting (EU subsidies, public procurement, concessions).

Carole has a proven track record of advising public…

Carole Maczkovics has developed a cutting-edge expertise in State aid law, with a strong background in the economic regulation of network industries (energy and transport) and in public contracting (EU subsidies, public procurement, concessions).

Carole has a proven track record of advising public and private entities, which she successfully represents in administrative and judicial proceedings on complex State aid and regulatory matters before the European Commission as well as before the Belgian and European courts. She also assists clients with the application of the new EU Foreign Subsidy Regulation and UK subsidy control regime.

Carole has published many articles on State aid law and on regulated network industries, and contributes to conferences and seminars on a regular basis. She is a visiting lecturer at King’s College London and at the Brussels School of Competition on the application of regulation and competition law (including State aid) in the railway sector. Carole gives trainings on State aid law at EFE, in Paris. She has been recently appointed as Academic Director of the European State aid Law Institute (EStALI).

Photo of Kevin Poloncarz Kevin Poloncarz

Kevin Poloncarz represents a broad range of clients on policy, regulatory, litigation, commercial, and enforcement matters involving air quality, climate change, and clean energy. He co-chairs the firm’s Environmental Practice Group and Energy Industry Group.

Mr. Poloncarz is ranked by Chambers USA among…

Kevin Poloncarz represents a broad range of clients on policy, regulatory, litigation, commercial, and enforcement matters involving air quality, climate change, and clean energy. He co-chairs the firm’s Environmental Practice Group and Energy Industry Group.

Mr. Poloncarz is ranked by Chambers USA among the nation’s leading climate change attorneys and California’s leading environmental lawyers, with sources describing him as “a phenomenal” and “tremendous lawyer.” He was named an “Energy & Environmental Trailblazer” by the National Law Journal in 2017 and was inducted as a Fellow of the American College of Environmental Lawyers in 2018.

He has extensive experience with California’s Cap-and-Trade Program, Low Carbon Fuel Standard (LCFS), Renewables Portfolio Standard (RPS), and is recognized as a leading advisor on carbon markets. He also assists energy-sector clients in obtaining and defending state and federal approvals for major projects throughout California.

Mr. Poloncarz also assists clients with the development and execution of legislative and policy strategies supporting decarbonization, including carbon capture and sequestration, low-carbon fuels, advanced transportation and energy storage, and is a registered lobbyist in California and Oregon.