COP 29: Progress, pitfalls and the road ahead for climate action

COP 29 – the Finance COP 

In November 2024, 66,000¹ people arrived in Baku, Azerbaijan for the 29th Conference of the Parties to the UN Framework Convention on Climate Change (COP 29). The focus of COP 29 was climate finance, including the trillions of dollars needed to fund climate change mitigation and adaptation projects, loss and damage funds and the transition to net-zero by 2050. 

Parties were keen to see progress on finance topics, to build on the success of COP 28. And COP 29 was not the only set of significant talks on climate change happening. G20 leaders also met in Rio de Janeiro, Brazil to discuss climate action. In a G20 communiqué, G20 leaders reaffirmed their support for the Paris Agreement and the “ambitious and balanced outcomes of COP 28”.  

In this briefing, we reflect on the main themes of COP29: Climate Finance, Carbon Trading, Energy Transition, Nature and Methane and Digital Technologies and look forward to the themes that will be picked up at COP 30 in 2025. 

“So let’s cut the theatrics and get down to real business”²
Simon Stiell, Executive Secretary of the UNFCCC

Climate Finance 

Setting a New Collective Quantified Goal (NCQG)

Following difficult negotiations, parties set a new climate finance target to support the implementation of plans for developing countries to meet nationally determined contributions and adaptation goals to cope with extreme weather and other effects of climate change – the New Collective Quantified Goal (NCQG).

The previous goal was $100 billion per year by 2020 and according to the Independent High-Level Expert group on Climate Finance, a group of leading economists, the NCQG needed to exceed $1 trillion to be sufficient to deal with the everyday realities of climate change.

The final agreement fell far short of this, when in the late hours of Saturday morning, long into extra time, the parties reached an agreement to:

1. triple finance for developing countries’ climate action to $300 billion per year by 2035 – coming from a variety of sources including public and private, bilateral and multilateral, with developed countries taking the lead. Developing countries may make voluntary contributions; and
2. work together to scale financing to developing countries for climate action from public and private sources to at least $1.3 trillion per year by 2035.

Many countries signalled dissatisfaction and objected to adoption of the NCQG. With comments ranging from characterising the goal as an “insult” to “lamenting that the climate crisis is becoming a debt crisis as developing countries are forced to resort to loans, which widens global inequalities”. Others argued that it was in everyone’s best interest to invest in tackling climate change now, given that costs of inaction will only rise.¹

“The cost of inaction is now much higher than the cost of action…water, soil degradation will all make it on to the balance sheet."
Peter Bakker, President & CEO of the World Business Council for Sustainable Development (WBCSD)

"This new finance goal is an insurance policy for humanity, amid worsening climate impacts hitting every country. But like any insurance policy – it only works – if premiums are paid in full, and on time. Promises must be kept, to protect billions of lives.”
Simon Stiell, Executive Secretary of UN Climate Change³

Loss and Damage

Agreed at COP 27, the Loss and Damage Fund, which provides financial assistance to countries most vulnerable to the impacts of climate change, was made fully operational at COP 29 with the signing of key agreements including the Trustee and Hosting agreements. The fund will be hosted in the Republic of the Philippines where the main operations have already been established.   The total pledged financial support for the Fund exceeds $730 million and should start financing projects beginning in 2025.⁴

Carbon Trading

Article 6 of the Paris Agreement

On the first evening of COP 29, two Standards⁵ were adopted in respect of the international carbon crediting mechanism established under Article 6.4 of the Paris Agreement to establish a global crediting mechanism for emission reductions. The Standards cover methodology principles setting out the basis for claim and assessment of emission reductions or removals and specific guidelines for carbon removal projects. The adoption was controversial as the Supervisory Body adopted the Standards rather than presenting them for consideration at COP as is customary.  Although this was an unorthodox process, the Standards were adopted on the first day of COP 29.

The parties also agreed operational elements of the framework for bilateral trading of internationally transferred mitigation outcomes (ITMOs) between countries under Article 6.2 of the Paris Agreement. Countries may use these carbon credits or ITMOs to contribute to meeting nationally determined contributions (NDCs).  Agreement was reached on authorisation (both content and format), reporting and data availability, amongst other things. But work on natural climate solutions and the inclusion of Indigenous peoples continues.

Growing the carbon markets has the potential to unlock funds for climate change mitigation and adaptation as well as enabling states to meet their NDCs.

Energy Transition 

Renewable Energy 

At COP 28, countries agreed to triple renewable energy capacity and double the rate of energy efficiency improvements by 2030 and to transition away from fossil fuels in energy systems.⁶ Burning fossil fuels causes 86% of global carbon dioxide emissions⁷, so to have a chance of meeting the goals of the Paris Agreement, fossil fuels need to be phased out. 

In pursuit of this aim and the development of the renewable energy market, the following announcements were made at COP 29:

• agreement to increase annual investments on grids and renewable power generation capacity by the Utilities for Net Zero Alliance; 
• agreement by three large multi-lateral development banks on the $670 million finance of two Azerbaijani solar power plants; and 
• commitment of seven Mediterranean nations to generate one terawatt of renewable capacity by 2030 through the TeraMed initiative, having an estimated investment of $700 billion.

But although the wording “transition away from fossil fuels” was agreed at COP 28, there was push back on including this wording in COP 29 documents, sparking a wave of criticism, accusing recalcitrant countries of backsliding on their promise from COP 28. 

Nature and Methane 

At COP 16, just two weeks before, nature was discussed as an important part of the solution to climate change. But although there was a specific day set aside to discuss nature at COP 29, the topic was sidelined as it coincided with negotiations on NCQG beginning and reference to nature and alignment with the Kunming-Montreal Global Biodiversity Framework was removed from the final text agreement for NCQG.  

Forests 

At COP 29, forests did have their moment in the sun.  The Forest & Climate Leaders' Partnership issued a statement underscoring their commitment to scaling up finance for forests and reporting progress on six country packages which have been launched to date reflecting each host country’s distinct priorities and circumstances in Colombia, the Democratic Republic of Congo, Gabon and other key locations. The importance of forests in delivering emissions reductions needed to meet the 2030 climate goals is highlighted in the UN’s Emissions Gap Report 2024.

During the COP, the UK made a particular commitment on forests, announcing £239 million of new funding to help forest-rich nations tackle climate change as part of its overall £11.6 billion funding package and recognizing the crucial role of forests as carbon sinks.

Methane 

Methane emissions have been responsible for about 30% of global temperature increases⁸ since the industrial revolution. Reducing these emissions is the fastest, most cost-effective way to keep the global temperature rise below 1.5°C – and is essential to avert worsening climate damages.⁹ At COP 29, China, the US and Azerbaijan convened a Summit to accelerate actions to cut methane and other non-CO2 emissions.  A number of different nations announced regulatory and policy steps to reduce super pollutants.  For example, the US announced the finalization of the oil and gas Waste Emissions Charge and the EU announced the Methane Abatement Partnership Roadmap to enhance political support for reducing emissions from internationally traded fossil fuels.¹⁰

Digital Technologies

“[W]e can and must reduce the environmental footprint of digital technologies while leveraging their undeniable potential to tackle the climate crisis”
Doreen Bogdan-Martin, ITU Secretary-General

COP’s inaugural ‘Digitalisation Day’ saw the COP 29 Declaration on Green Digital Action being endorsed by more than 1,000 governments, corporations, international and regional organisations and other stakeholders.   

The Declaration recognises the application of digital technologies to assist in climate change mitigation and adaptation, as well as acknowledging the negative impacts of digital technology including the growing emissions from data centres and e-waste.¹¹  The Declaration includes a set of common objectives focusing on leveraging digital technologies as tools for climate action, for enhanced climate monitoring, forecasting, mobile early warning systems, developing policies and technical advancement to contribute to mitigating digitalisation’s climate impact. 

Looking forward to COP 30 

"COP30 will be our last chance to avoid an irreversible rupture in the climate system."¹²
 Luiz Inácio Lula da Silva, President of Brazil

As COP 29 closed, feedback was mixed.  But Luiz Inácio Lula da Silva, Brazil’s President, brought some optimism to the table, referring to COP30 as the “turnaround COP”. According to President Lula, we should expect to see (1) increased accountability from developed nations, (2) a greater recognition of role of indigenous and traditional communities and (3) improved integration of fragmented efforts across countries. Whilst COP 29 has been far from a universal success, there has been progress on a number of key themes and all eyes are turning to COP 30 where, following recent elections around the world, parties will meet in a potentially more challenging political environment to continue this vital work.

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This note is intended to be a general guide and covers questions of law and practice. It does not constitute legal advice.

Authored by Emily Julier, Amy Cleaves, Bryony Widdup, Eseohe Imafidon and Jessica Dhodakia.