In light of the intensifying impact of climate disasters and the alarming rise in greenhouse gas emissions reaching an unprecedented level, the impending UN climate summit (COP29) stands as a pivotal opportunity to catalyze more aggressive climate action on a global scale.
Scheduled to take place in Baku, Azerbaijan, from November 11 to November 22, 2024, this summit will primarily concentrate on how to enhance and accelerate climate financing for nations and communities that face the greatest urgency. Additionally, it serves as a significant moment for international leaders to communicate their strategies to reinforce national climate commitments and fulfill prior pledges.
This article offers a comprehensive analysis of the forthcoming COP29 negotiations, elucidating what’s at stake and the essential actions required in Baku to propel swift advancements in critical areas:
Delivering a New Climate Finance Goal
Over the past three years, countries have been engaged in a series of intricate negotiations to outline the New Climate Finance Goal (NCQG). Yet, fundamental issues regarding the appropriate size and structure of this financial goal continue to be debated. The Baku summit will be pivotal for negotiators and political leaders to finalize a consensus on this vital topic.
Webinar: scaling up climate finance in Baku
A panel comprising experts from WRI and beyond will discuss actionable strategies for achieving an ambitious climate finance goal that adequately addresses the needs of developing nations.
Watch Here
A central decision point will involve determining the target dollar figure for the NCQG. Various countries and organizations have proposed annual climate finance goals ranging from billions to trillions. Currently, it appears that the goal will include various targets that reflect different types of financial flows, encompassing both public and private sectors. Additional critical considerations involve identifying which nations will provide funding, whether specific financial tools (such as grants or concessional loans) will receive preference, and the requisite reporting to ensure transparency.
The NCQG is not intended as a panacea for all climate finance challenges; however, it is an integral component of the solution. COP29 represents an important opportunity to adopt a robust finance target that empowers nations to elevate and fulfill their climate ambitions in forthcoming years. Additionally, the outcomes of the summit can call for transformations across all actors in climate finance, including multilateral development banks, to amplify climate finance overall, facilitate private investments, engage novel funding avenues, and guarantee that all funding sources foster an equitable transition towards low-carbon economies.
On a farm in Kenya, a woman diligently waters her crops utilizing a solar-powered water pump. The newly negotiated climate finance goal at COP29 is aimed at channeling additional resources toward clean energy projects and innovative climate solutions for countries and communities in pressing need. Photo by Jeffery M Walcott/IWMI
Showcasing More Ambitious National Climate Commitments
Countries are expected to unveil revised national climate commitments, known as nationally determined contributions (NDCs), in 2025. These critical pledges serve as the foundational elements of the global response to climate change as established under the Paris Agreement. Several key emitters, including Brazil (the host for the next UN climate summit), the United Kingdom, and the United Arab Emirates, have signaled intentions to disclose or reinforce their climate commitments during this year’s COP. The announcement of more ambitious pledges by these nations can establish a high benchmark for others and incentivize increased commitment from other countries.
Specifically, the next-generation NDCs should encompass expansive economy-wide greenhouse gas (GHG) reduction targets for 2035 as well as more stringent goals for 2030, which collectively aim to keep global temperature rises within the 1.5 degrees Celsius (2.7 degrees Fahrenheit) threshold. These near-term targets are essential; failing to achieve significant reductions in emissions by 2030 will hinder the ability to make critical gains by 2035, thereby making it impossible to limit warming to 1.5 degrees C without overshoots and risking extreme climate repercussions. Furthermore, these short-term objectives must lay out credible pathways for nations to achieve their net-zero goals by mid-century or around that time.
Committing More Funding for Loss and Damage
The climate emergency has escalated to such a critical point that some consequences have surpassed the ability of affected populations to adapt, resulting in losses of lives and livelihoods due to extreme weather events like floods and wildfires, alongside the erosion of coastal heritage owing to rising sea levels. Within the UN climate negotiations, this pressing issue is identified as “loss and damage.”
On the inaugural day of COP28, the Fund for Responding to Loss and Damage (FRLD) was officially launched to allocate financial resources to developing nations grappling with the ramifications of climate change. Since its inception, the World Bank has set up the fund’s trustee arrangements, while the Philippines was appointed as the host nation for the Fund’s board. Furthermore, Ibrahima Cheikh Diong, a prominent Senegalese-American, was designated as the inaugural Executive Director of the Fund. Ongoing institutional developments include the establishment of a resource mobilization strategy anticipated to be operational by 2025.
Catastrophic flooding in Rio Grande do Sul, Brazil, in May 2024, highlights the urgency of the matter. COP29 presents a crucial opportunity to enhance financial allocations for nations and communities contending with unavoidable loss and damage stemming from climate change. Photo by Cid Guedes/iStock
Enhancing Adaptation Finance and the Global Goal on Adaptation
At COP29, nations should prioritize closing the existing adaptation finance gap, which currently stands between $194-$366 billion annually and continues to grow. In 2021, countries formally committed to doubling adaptation financing by 2025 as outlined in the Glasgow Climate Pact. Developed nations are in the process of compiling a report that will be presented at COP29, documenting their advancement towards this goal as urged in the Global Stocktake outcome from the prior year. Simultaneously, negotiators can bolster resilience initiatives in developing countries by ensuring that the NCQG equitably prioritizes adaptation funding, treating it on par with mitigation financing, and acknowledges the necessity for adaptable, low-interest terms for such funding.
Another key focus in Baku will be enhancing the Global Goal on Adaptation (GGA), which represents a collective pledge to hasten adaptation across all countries. At COP28, nations agreed upon a framework for the GGA detailing targets to be achieved by 2030 and initiated a two-year work agenda to determine the metrics for assessing adaptation efforts. During COP29, negotiators will collaborate to agree on a practical set of indicators that will effectively track progress and finance flows at both national and local levels.
Leveraging Carbon Markets to Drive Climate Action
Article 6 of the Paris Agreement permits countries to engage in the trading of carbon credits as a means to achieve their respective climate objectives. For instance, a nation endowed with affluent tropical forests could sell carbon credits, generating funds that support forest conservation efforts, while nations that buy the credits would count the corresponding emissions reductions towards their own NDC targets. The framework for these carbon markets still requires refinement before actual trading can commence, which will be a primary task for negotiators in Baku. Establishing these regulations correctly is vital to guarantee that international carbon markets under Article 6 — distinct from voluntary markets and adhering to rigorous international standards — remain environmentally effective and do not compromise global emission reduction efforts.
Despite recently failing to finalize the Article 6 regulations at COP28, Parties have witnessed some progress in building consensus. The Supervisory Body for the newly designated Paris Agreement Crediting Mechanism (PACM), which encompasses international carbon crediting, has reached decisions regarding two essential standards (methodology requirements and activities related to emission removals) that will serve as the groundwork for carbon crediting. Moreover, they have determined that all projects within this framework must adhere to necessary environmental and human rights safeguards.
Nonetheless, several intricate yet significant discussions await resolution in Baku, including:
- the prospective advancement of the Supervisory Body’s adopted standards;
- mechanisms for authorizing carbon credits, including the potential for nations to retract authorization from previously permitted credits;
- whether carbon credits should undergo a technical review prior to utilization;
- and whether developing nations with limited capacities can access the international trading registry for credit transactions.
A worker plants a tree as part of a reforestation initiative in West Java, Indonesia. Effective carbon crediting initiatives can finance the protection and restoration of vital ecosystems, yet the rules under discussion at COP29 are essential to ensure these initiatives yield positive outcomes while avoiding unintended consequences. Photo by Pacific Imagica/Alamy Stock Photo
Boosting Transparency Around National Climate Action
COP29 is poised to be a landmark event for operationalizing the Paris Agreement’s enhanced transparency framework. Countries are mandated to submit their inaugural biennial transparency reports (BTRs) by year’s end, detailing how they are addressing climate change. These reports will provide critical information regarding their efforts to reduce GHG emissions, adaptation initiatives and plans, as well as an outline of financial support provided, generated, received or required by each country. The first reports will also exhibit the progress — or lack thereof — that countries are making towards their 2025 and 2030 NDC targets, serving as a useful resource for shaping subsequent NDCs and decision-making processes.
Drafting biennial transparency reports poses a significant challenge, particularly for developing nations that lack extensive experience in international climate reporting and therefore require capacity-building assistance. Acknowledging these hurdles, the Azerbaijani presidency has introduced the Baku Global Climate Transparency Platform to highlight the importance of transparency and enhance the reporting process, conducting several regional workshops to bolster these efforts.
Demonstrating Progress Toward Collective Climate Commitments
The COPs serve as a crucial venue for collaborations among governments, the private sector, and cities to forge commitments aimed at accelerating climate action together. The past few years have seen a dramatic increase in “cooperative initiatives,” many of which have emerged from recent summits. Key outcomes include pledges to boost renewable energy deployment, phase down fossil fuels, foster urban climate efforts, green the finance sector, halt deforestation, and more.
Despite these pledges highlighting a rising ambition, WRI research indicates that most lack adequate transparency mechanisms to evaluate whether parties are fulfilling their commitments.
COP29 acts as a vital opportunity for stakeholders to showcase measurable advancements concerning their cumulative commitments. For existing initiatives, this entails clear public communication of progress through the UNFCCC’s Global Climate Action Portal or by releasing progress reports. This process would facilitate a better understanding of the role cooperative efforts play in promoting ambitious action. Additionally, governments engaged in various initiatives should contemplate incorporating their contributions into their NDCs. Moreover, new initiatives introduced at COP29 should be structured with clear operational plans that enable transparency regarding their future progress.
COP29: Unlocking Climate Action for All
COP29 represents an extraordinary opportunity to elevate global climate ambition to unprecedented levels. A meaningful finance outcome in Baku will help ensure that all nations — particularly those that are impoverished and most vulnerable — have access to the necessary resources to pursue sustainable, low-carbon development, assist communities and workers, and safeguard themselves against escalating climate threats. To fulfill this promise, such outcomes must intertwine with unequivocal supportive signals from other international platforms and institutions, including the G20 and multilateral development banks. This requires seamless cooperation among public, private, domestic, and international financial resources to enable transformative advancements.
As nations reassess their climate commitments, COP29 additionally provides a platform for major emitting countries to demonstrate enhanced leadership by presenting more ambitious climate strategies and reaffirming their previous vows. Developed nations should exemplify forward-thinking by formulating new and refined NDCs that distinctly map a trajectory towards low-carbon, climate-resilient, and inclusive economies that also prioritize nature.
In essence, a powerful outcome in Baku can be a crucial step toward unlocking a safer, more equitable, and prosperous future for all.
