Climate summit: Discussion for discussion’s sake
Finance is poised to be the central issue at COP29, taking place in Baku this month – but progress will be technical and slow.
In a nutshell
- Climate finance and carbon markets will take center stage at COP29
- Vulnerable countries want assurances on loss and damage mechanisms
- Incremental progress is the only feasible outcome
Azerbaijan is set to host the 29th session of the Conference of the Parties (COP29), gathering signatories of the United Nations Framework Convention on Climate Change. From November 11 to 22, around 50,000 people will gather in Baku to discuss global warming. Only 10,000 of these are negotiators, the rest are observers and the media.
The capital of a country whose main exports are oil and gas seems an unlikely place for a climate summit. Many have criticized the choice, saying that a country with “a vested interest in keeping the world hooked on fossil fuels” should not be overseeing crucial climate negotiations. Even more bizarre is the ratio of environmentalists to active negotiators, with protests already planned. However, such follies are typical, if not characteristic, of global climate negotiations.
Looking at the matters on the table for discussion, four critical points emerge. First, there is the “New Collective Quantified Goal,” which is related to financing the transition to low-emission economic activity. Then, there is the question of carbon markets, or in negotiator language, “cooperative approaches.” Nowadays, this very divisive topic is called “Article 6,” in reference to where it is stipulated in the Paris Agreement. As usual, the question of how to boost the ambition to reduce greenhouse gases is on the agenda. Finally, negotiators will discuss adaptation to climate change, as well as loss and damage mechanisms for countries facing effects of climate change that are now severe and irreversible. These goals are important, but they are also longstanding, and will not be solved at this one gathering despite the unrealistic expectations of many observers.
Who should finance climate goals?
The upcoming COP29 is expected to center heavily on the New Collective Quantified Goal (NCQG) for climate finance. This year’s conference has been dubbed the “finance COP,” reflecting the priority it places on establishing a robust and ambitious NCQG. The goal is to move beyond commitments of billions of dollars in climate finance, and toward trillions, an essential shift to meet the rapidly growing needs of climate action globally.
Facts & figures
COP29 agenda
At COP29, negotiators are expected to work toward a collective goal that addresses the specific needs of developing countries, enabling them to effectively implement their Nationally Determined Contributions and National Adaptation Plans.
One of the most challenging aspects of the collective goal discussions will likely be balancing the different interpretations of its scope. Those most at risk of climate damage, particularly members of the Vulnerable 20 (V20) group like Vanuatu and Barbados, advocate that the collective goal should exclusively align with Article 9 of the Paris Agreement by focusing on the finance obligations of developed nations. However, most developed nations, including EU countries and the U.S., suggest a broader mandate, potentially including contributions from countries “in a position to do so,” extending the financial responsibilities to emerging economies.
Developing countries are expected to strongly support a collective goal that responds to their needs through public finance delivered as grants and highly concessional loans, rather than through additional debt burdens. They may also advocate for a goal that addresses the various barriers they face, such as high capital costs, unsustainable debt levels, limited fiscal space, currency risk and difficulties accessing international financing. Agreeing on who should foot the bill for climate action has been an ongoing issue in the COP summits.
The structure of the collective goal is also expected to be heavily debated. Several developed nations favor a “layered approach,” with a central core of public finance targeting the specific needs of developing countries, and an outer layer encompassing global investment flows for climate action on a broader scale. In contrast, other parties support a unified, single-layer approach that integrates both elements without distinction.
The parties hope to reach a consensus on these aspects that yields a structured collective goal incorporating qualitative and quantitative elements, establishing a framework emphasizing ambitious yet practical commitments. This, too, will take time.
Cooperative carbon markets
The operationalization of Article 6 of the Paris Agreement will be another critical focal point at COP29. Article 6 establishes guidelines for international cooperation on carbon markets and non-market mechanisms, allowing countries to work together to meet their emission reduction targets. Ensuring that Article 6 is fully functional is essential to maintaining environmental integrity, credibility, transparency and, ultimately, the effectiveness of cooperative approaches in reducing emissions. However, the complexity of implementing Article 6, particularly regarding technical and procedural aspects, has led to significant delays in finalizing the necessary guidance.
The discussions at COP29 are expected to cover the two main provisions under Article 6: one facilitating direct cooperation between countries, and the other establishing a centralized UN mechanism to regulate global carbon market transactions. The successful conclusion of Article 6 guidance could enhance predictability in international carbon markets, providing more explicit rules for countries to account for and report emissions reductions achieved through cooperative approaches.
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Key areas of debate are likely to revolve around authorization, registry functionality and transparency requirements. Authorizations will determine whether countries can accommodate different approaches, changes or revocations of prior carbon commitments, a topic that has proved divisive. The infrastructure to be used to implement Article 6, particularly the international registry, is another point of contention. Some parties are pushing for a centralized digital registry for enhanced coordination and accountability, while others argue for a more flexible approach that respects national circumstances. Transparency will also be critical, with countries negotiating additional guidance on reporting and reviewing cooperative actions to ensure credibility and integrity in emissions reporting.
While much of the work on these issues may happen at the technical level, specific aspects – particularly around authorizations and the registry structure – may require higher-level political discussions to resolve. A failure to achieve consensus on these issues could lead to confusion about how countries should undertake cooperative approaches and report annual information, potentially sending negative signals to carbon markets and weakening the ambition levels of national climate commitments.
Greenhouse gas mitigation front and center
Reducing greenhouse gas emissions will once again be a key area of focus at COP29. Building on the outcomes from COP28, many parties are expected to push for further progress on mitigation, emphasizing the implementation of existing targets over the introduction of new ones. This approach reflects a broader shift away from setting additional goals toward implementing and enforcing existing commitments, particularly under the Mitigation Work Programme framework. The framework provides a platform for countries to share experiences and lessons learned, fostering collaboration to help bridge gaps in national capabilities and promote more inclusive climate action.
Facts & figures
Climate-vulnerable countries join together
An essential part of COP29’s mitigation agenda will be integrating the Global Stocktake outcomes into decision-making processes. The GST, a periodic review of global progress toward the goals of the Paris Agreement, provides a comprehensive assessment of countries’ mitigation, adaptation and financial efforts. At COP29, discussions are expected to emphasize the importance of translating the Global Stocktage findings into actionable steps, particularly regarding the 1.5 degrees Celsius warming limit outlined in the Paris Agreement. Addressing gaps in finance and means of implementation will help countries strengthen their Nationally Determined Contributions and align them more closely with the 1.5 degrees Celsius target.
This focus on implementation may include enhancing support for developing countries to adopt and scale up climate technologies, strengthen institutional capacities and build resilience in vulnerable sectors. Discussions may also revolve around creating a framework for tracking and reviewing national mitigation efforts, with an emphasis on transparency and accountability.
Adaptation, loss and damage
Adaptation, as well as loss and damage, are likely to be two of the most pressing issues at COP29, especially for countries most vulnerable to climate change. Adaptation refers to the adjustment of systems and practices to cope with climate change. Loss and damage refers to the irreversible effects of climate change, such as extreme weather events that cannot be mitigated or adapted to. These two areas have gained increasing prominence as the need for tangible progress in climate resilience becomes more urgent.
A primary expectation at COP29 is that parties will build on the progress made under the Global Goal on Adaptation, working toward establishing a clear roadmap for advancing adaptation efforts globally. Many countries anticipate that COP29 will yield actionable steps for improving adaptation finance and addressing the barriers that often limit access to funding for adaptation initiatives. These barriers include complex application processes, limited funds and insufficient coordination across funding mechanisms. By simplifying access to adaptation finance, COP29 could make it easier for vulnerable countries to implement projects that enhance their resilience to the effects of climate change.
The Loss and Damage Fund, a major topic in recent climate discussions, is also expected to feature prominently at COP29. The fund is intended to provide financial support to countries experiencing severe climate change repercussions that surpass their capacity to adapt. There is strong anticipation that the fund will be fully operationalized during COP29, providing a dedicated financial mechanism for addressing the impacts of climate change on vulnerable communities. This would mark a significant milestone in the global climate agenda, addressing a longstanding demand from developing countries for more direct support in coping with climate losses and damages.
COP29 may also explore ways to enhance coherence and coordination across various loss and damage frameworks, such as the Warsaw International Mechanism. This could include developing cross-cutting strategies that integrate loss and damage considerations into broader climate action frameworks, and creating synergies between adaptation and mitigation efforts. Many parties will likely push for a streamlined, integrated approach to effectively address the full spectrum of climate risks vulnerable countries face.
Scenarios
What will happen at COP29? There is one definitive answer: Nothing new. These climate summits are technical, bureaucratic negotiations. They are not supposed to be significant events. COP29’s agenda showcases this. These “key” topics have been on the table for years, some for decades.
Unlikely: Concrete commitments
From the Convention’s point of view, the best case is for the parties to make concrete decisions concerning NCQG, Article 6, increasing mitigation ambition and strengthening adaptation, loss and damage financing. Even in this case, these topics will still be passed on to COP30 for further discussion – they will not be closed. This scenario would mean that developed countries need to step up their financial contributions. Whether they will be able to do so is questionable. It is almost certain that they will need time to mobilize resources.
Possible: No consensus
In the worst case, from the Convention’s point of view, no consensus is found on the two main topics, NCQG and Article 6, nor on how to increase ambition in mitigation and finance adaptation. The consequences of such a scenario would simply be that these items are passed on to the agenda of COP30.
Most likely: Incremental progress
The likely case is that some progress will be made in all these items, albeit in different degrees of significance. Most importantly, the parties could agree to a framework and criteria for further discussing the NCQG. But again, even when such partial decisions are taken, these topics will also be passed on to the COP30 agenda. The reason is simple: The Convention and the Paris Agreement are dynamic and need constant development and renegotiation.
For that reason, and due to the time developed countries insist they require to mobilize climate funds, these topics will reappear in at least the next couple of COPs, and along with them, thousands of negotiators and tens of thousands of environmentalist observers.
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