From 11 November – 24 November 2024, the 29th United Nations Climate Change Conference of the Parties (COP29) was held in Baku, Azerbaijan. The annual conference brings countries from around the world together to discuss progress and agree goals in slowing global warming.
The focus for 2024 was on was on reaching a decision on financing, which has led to COP29 being called the ‘finance COP’. The framework for action calls on countries to “Enhance ambition and enable action”, which encourages them to set ambitious targets and provide financial support to countries in the Global South. Other elements of the framework include reinforcing the “fixed objective” of halting temperature rises at 1.5°C and recognise the importance of all countries being included, seeking an “Inclusive process for inclusive outcomes”.
This article sets out some of the key developments from COP29, focusing in particular on the new climate finance goal, other developments from COP and those seen within the UK, and look forward to what’s next on the climate change agenda.
Climate finance – The Baku Finance Goal
Reaching a decision on finance has been hailed as a ‘breakthrough’ by the COP29 Presidency. Negotiations to reach the goal extended the conference by over 32 hours, and several countries and organisations walked out during the process, including the Alliance of Small Island States and Least Developed Countries, citing an ‘unacceptable deal’ as the reason for leaving negotiations.
Despite this, a key outcome of the conference was the agreement of the New Collective Quantified Goal on Climate Finance (NCQG), which promises $300 billion USD (approx. £240 billion) per year by 2035 to be provided to developing countries for climate-related mitigation and adaptation measures. This means the money will go towards measures which seek to prevent the temperature rise by reducing emissions, and those which provide support for countries needing to adapt to new situations caused by climate change-related events.
A key rationale behind the concept of climate financing is the so-called ‘unequal burden of climate change’, which refers to the way in which the countries which have contributed the least to climate change are often the ones suffering the worst effects in the form of extreme weather events, sea level rises and displacement. The onus is therefore on the developed countries to provide assistance to small-island states and least developed countries. This is reflected in the NCQG agreement, which calls on developed countries to lead the way in financing, leaving it up to each country to decide how to source this money, suggesting that they draw from a range of sources across the public and private sphere.
This goal has been received positively by the UK government and the UN. The Executive Secretary of UN Climate Change has stated that the decision will result in “more jobs, strong growth, cheaper and cleaner energy for all”, and the UK’s Secretary of State for Energy Security and Net Zero, Ed Milliband, has expressed a similar positive sentiment around the economic opportunities this investment brings.
However, the goal has been received less positively by the Global South and representative charities and NGOs, who have expressed their disappointment at the figure and emphasised the urgency of the matter on the basis that they are already dealing with the disastrous effects of climate change. Others are calling for oil companies to foot the bill to cover any public sector funding which is allocated to climate action. In light of the walk outs during negotiations, it could be said that those most affected by climate change were not in the room when the decision was reached, and for those who were there, many countries from the Global South have expressed that they were unable to contribute meaningfully, given that no opportunity to object was presented before the decision was adopted.
Other developments at COP29
Carbon markets
A further key development at COP29 was the final negotiations around Article 6 of the Paris Agreement and agreement on the operationalisation of carbon markets. This mechanism will enable countries to trade carbon credits under a transparent framework to meet their nationally determined contributions (NDCs), with savings estimated at $250 billion per year. This is particularly significant for developing countries who will be able to transfer or sell their credits to countries which are struggling to meet their targets - the profits from which can be reinvested into climate-related measures.
Loss and damage fund
Final decisions were made on the Loss and Damage Fund, with plans for this to be up and running from next year and with $730 million pledged to the fund. This will be a positive development for countries which are most vulnerable to the effects of climate change and so will be able to benefit from this fund to aid in their recovery from climate disasters.
Developments in the UK
In light of one of Labour’s priorities being to enhance clean energy in Britain, it is perhaps unsurprising that Kier Starmer announced new NDCs one day into the conference, setting the target of reducing emissions by 81% by 2035 (compared to 1990 levels). This is a substantial development on the 2030 goal of 68% reduction and demonstrates the Government’s commitment to tackling climate change. All countries are due to finalise their NDCs early this year, and the Labour government appears to be setting the standard with its ambitious goal.
It is clear that achieving the government’s new target will require significant investment into new technologies to further develop clean energy and enhance energy security. An example of action already taken to begin delivering on these ambitions is the launch of Great British Energy, which will see an investment of £8.3 billion over the course of the current Parliament into new technologies. Further announcements from the UK government during COP29 included new funding for climate vulnerable countries to develop clean energy technology and other innovations.
These developments present opportunities for investment in emerging markets and technologies, as well as for large domestic clean energy projects. Whilst contributing to the NDCs, these investments will also stimulate the economy by providing high numbers of jobs and investment opportunities. The Labour government’s commitment to being a leader in climate action suggests that we are unlikely to see deceleration of investment in this area, at least for the foreseeable future.
What’s next for the climate change agenda?
Donald Trump’s election win the week before COP29 was highlighted as a ‘huge roadblock to progress in both cutting emissions and raising cash for developing countries’. During his last term he withdrew the US from the Paris Agreement and there are concerns that he will do so again when he comes into office. If this happens, the US will no longer be restrained by UN rules and guidance. Trump has also expressed a desire to reinvest in oil and gas, including through offshore drilling. This stance from the US could result in potentially significant setbacks to the international fight against climate change.
Demonstrated by the catastrophic climate-related weather events which took place during 2024, including flooding in Spain, Nepal and beyond, and the global rise in heat-related deaths, it is clear that there is still plenty of work to be done globally to curb the planet’s rising temperature. Looking to COP30, which is expected to take place in Brazil this year, many hope that the delegate countries to that conference will more meaningfully move the agenda forward in an inclusive way that takes account of those who are most affected by climate change.
The Labour government’s commitment to being a leader in the climate change space indicates that on a national level, the country will continue on its trajectory of aiming for ambitious targets. Whether this ambition is reflected globally will become clearer when countries submit their NDCs in due course.
This article was written by Phillipa Shepherd and Megan Firth.