Advocates for the energy transition are concerned ahead of the COP28 summit in Dubai about the high cost of capital available to make change happen, as policymakers ratchet up their rhetoric on the need for tight monetary policy.

COP28 is widely expected to focus on climate finance, specifically to build on the G20 nations' commitment to triple renewables deployment to about 11,000 gigawatts by 2030, which will need funds of around $4.5 trillion.

"I'm very worried," Gauri Singh, deputy director general at the International Renewable Energy Agency (IRENA), told the Reuters Global Markets Forum when asked about the impact of higher interest rates on funding climate initiatives.

"What used to be available at Libor plus 50 (basis points) or Libor plus 100 is not available at those rates any more."

Climate finance is going to be the "Achilles' heel" of COP28, said Vaibhav Chaturvedi, fellow at the Council on Energy, Environment and Water (CEEW).

The summit will discuss financing reforms including the Barbados-led Bridgetown Initiative, a proposal to unlock more capital for climate change targeting multilateral banks for which the World Bank has been selected to deploy new funds.

"Just because G20 accepted (the renewables goal) doesn't mean everybody will," said Chaturvedi.

"If this 'who pays' is not going to be solved, what is the point in the World Bank being the host facility when it will not get any funding?"

Linda-Eling Lee, head of the MSCI Sustainability Institute, said companies and investors cannot be expected to commit long-term capital to the energy transition if policymakers change track suddenly.

"Finance needs more policy certainty," Lee said. Index provider and data firm MSCI's Net-Zero Tracker projects a slower pace of decarbonisation this decade by listed companies in nine of the G20 nations examined.

Agreements on greater transparency in disclosures, along with innovations in finance, will help mobilise more private sector funds, Lee said.

(Reporting by Divya Chowdhury in Mumbai; Editing by Jan Harvey)