It’s that time of the year again, with nearly 200 countries gathering at the United Nations Framework Convention on Climate Change (UNFCCC) Conference of Parties (COP) to discuss climate action. This year’s COP, the 29th conference of its kind, will be hosted by Azerbaijan in its capital, Baku, from 11 November to 22 November.
The two pillars of the conference, as highlighted in COP29 President-Designate Mukhtar Babayev´s first letter to the parties, will be enhancing ambition and enabling action. Often referred to as the ‘Finance COP’, the conference this year will be heavily focused on mobilizing climate finance, with key finance initiatives including the New Collective Quantified Climate Finance Goal, the operationalisation of the Loss and Damage Fund, Climate Finance Action Fund or the Baku Initiative for Climate Finance, Investment and Trade.
The new financing initiatives will need to contain sub-goals to determine where financing should go and ensure transparency, particularly in light of new data from Oxfam that up to $41 billion of climate finance has been unaccounted for.
After being hosted in the UAE last year, the COP29 this year is taking place in a petro-state for the second year in a row. After agreeing on the UAE Consensus to transition away from fossil fuels at COP 28 last year, many have expressed concerns about the commitment of the host country, Azerbaijan, to this goal. Azerbaijan’s President Ilham Aliyev, has described the country’s abundant fossil fuel resources as a “gift from God” and defended natural gas expansion to meet Europe’s demand, raising doubts about the COP28 commitment to reduce oil and gas expansion and demand.
Further, it is the third consecutive year that the climate conference will take place in a country with questionable human rights records, as the country has shown hostility towards independent activism and journalists, according to Human Rights Watch, and restrictions on rights to freedom of expression, association, and assembly, according to Amnesty International.
After the United States´ announcement to withdraw from the Paris Agreement in 2017 during the presidency of Donald Trump, the results of the 2024 US elections, held just before the commencement of COP29, have been keenly awaited. The newly re-elected Donald Trump has reiterated his commitment to “drill, baby, drill” and plans to again withdraw from the Paris Agreement upon his presidential inauguration for his second term in January.
As one of the largest current and historical emitters, the rumored absence of President Biden at COP29 raises fears that the United States’ lack of commitment to climate action could undermine international efforts to limit warming to 1.5 degrees Celsius, secure financing pledges and increase ambition for upcoming NDCs.
Given these challenges of political uncertainty, a lack of commitment phasing out fossil fuels, and missing finance for ambitious climate actions, it is essential to focus on the critical issues that will shape the discussions and outcomes at this year’s conference.
Here are five critical issues to keep an eye on at COP29:
- Setting a new finance target for post-2025, known as the New Collective Quantified Climate Finance Goal (NCQG), will be the centrepiece of the COP29 agenda. The current climate finance goal of USD 100 billion annually was only reached in 2022, despite already having been declared as the goal at COP15 in 2009 by 2020, and thereafter reaffirmed in the Paris Agreement in 2015. The Paris Agreement provides that the COP shall set a NCQG from an annual floor of USD 100 billion prior to 2025. The NCQG will support developing countries in mitigating and adapting to climate change, which is especially important as countries prepare to submit new and more ambitious NDCs in February 2025. One especially heated discussion point will likely be the expansion of the donor base. Traditionally, only developed countries have contributed to this fund, but with the economic growth of major emitters like China, some countries, including the US and Germany, have announced plans to advocate for newly industrialising nations to also chip in.
- Further operationalising the Loss and Damage Fund, which was established at COP27, will be a central focus at this year’s conference. At COP28, the Fund took a step towards operationalisation by appointing the World Bank as its interim host, a decision that raised concerns over donor countries’ potential influence on fund management and allocation by developing countries. At this year’s conference the third review of the Warsaw International Mechanism for Loss and Damage will take place and the first report of the Fund for responding to Loss and Damage will be delivered. Unlike the NCQG, which is geared toward future investments, the Loss and Damage Fund is designed to address the immediate impacts of climate change on vulnerable communities, including slow onset events and extreme weather events, which may result in loss and damage.
- Launching the Global Matchmaking Platform that is part of the Climate Club, an initiative officially established at COP28, which focuses on international cooperation for decarbonising heavy-emitting industries like steel, cement, and concrete and is designed to accelerate industrial decarbonisation in emerging markets and developing economies (EMDEs). The platform, managed by UNIDO, will facilitate cooperation by connecting EMDEs with technology developers, financiers, and expertise needed to decarbonise their industries. The matchmaking will happen through relevant government ministries or agencies submitting a request to the platform, which will be circulated to a network of delivery partners part of the platform, resulting in a match between government, delivery partners, and donors. This is essential for ensuring that EMDEs can achieve net-zero targets while sustaining economic growth and will be open to all countries eligible for official development assistance. As highlighted in EPICO's publications (here and here), the Climate Club has significant potential to drive the decarbonisation of steel and other hard-to-abate sectors through coordinated international efforts. The launch of the Global Matchmaking Platform is a significant step in this direction.
- The “Green Energy Zones and Corridors Pledge” and “Global Energy Storage and Grids Pledge” are both crucial initiatives at the heart of fulfilling the COP28 goal of tripling renewable energy capacity by 2030. Therefore, the Green Energy Zones and Corridors Pledge will help develop hubs for renewable energy generation and improve transmission across borders. The Global Energy Storage and Grids Pledge will set a global goal of 1,500 GW of energy storage by 2030 and call for a grid expansion target of over 80 million kilometres by 2040. Both pledges will emphasise multilateral cooperation and foster energy resilience.
- The Harmoniya Climate Initiative for Farmers will provide coherence to the multitude of global and regional initiatives that have been developed over successive COPs. The initiative aims to build climate-resilient agricultural communities by fostering collaboration, knowledge sharing, and catalysing investment in climate-resilient agri-food systems. Funding needs will have to be matched with available funds and the initiative seeks to facilitate collaboration between Multilateral Development Banks and national agricultural public development banks. Financing climate-resilient agriculture is crucial in reaching climate goals - a report by the Climate Policy Initiative highlights that between 2019 and 2020 only 4% of the global climate finance reached agri-food systems, calling for a sevenfold increase from 2019 levels. Building on the first dedicated food day at COP28, this year’s COP will again commit one day of the conference, 19 November, to the agriculture, food, and water nexus.
Apart from these five thematic areas at COP29 that are likely to be quite prominent, some others also deserve honourable mentions. These include a hydrogen declaration that will be proposed by Azerbaijan in collaboration with UNIDO to seek the harmonisation and development of low-carbon hydrogen markets, as well as continued (and overdue) efforts to fully operationalise Article 6 of the Paris Agreement to create global voluntary carbon markets.
COP29 represents a critical juncture for climate change mitigation and adaptation, bringing together diverse stakeholders to tackle environmental challenges. However, differences in national priorities and potential disagreements over financial commitments may complicate consensus-building efforts at COP29. With a strong focus on mobilising essential climate finance, launching various platforms and pledges to decarbonise industries, and building resilient energy systems, the conference’s outcomes will be crucial for advancing global cooperation and progressing toward net-zero targets.
This Blog Post was written by EPICO's working student Ayana Trüper.