The annual United Nations climate summit began Monday with countries set to face tough talks on finance and trade, after a year of weather disasters that have emboldened developing countries in their calls for climate funds.
Delegates gathered in Azerbaijan’s capital, Baku, hope to resolve the main agenda item of the COP29 summit: a deal for up to $1 trillion in annual climate finance for developing countries, replacing of the $100 billion goal.
That discussion might be hard to follow a climate denier whose campaign promised to remove the historic largest emitter of greenhouse gases and the largest producer of oil and gas from the historic 2015 Paris Agreement to fight climate change for the second time.
COP29 delegates will also seek to carry forward other agreements made at previous summits.
Here are the key issues to watch at COP29:
What is the NCQG and why is it dominating this year’s summit?
The acronym dominating this year’s summit is NCQG, which stands for New Collective Quantified Goal.
This refers to the new annual climate finance target, which is expected to come into force when the current $100 billion commitment expires at the end of this year.
As of 2020, wealthy nations have only occasionally met that annual target, leading to growing mistrust among the most climate-vulnerable nations.
As COP29 aims to set a much higher target for the years ahead, rich nations insist that the money cannot come entirely from their budgets.
Instead, they are discussing a much more complex effort that would involve reforming the global multilateral lending complex to reduce climate-related financial risks and encourage more private capital.
It is unclear how much of the total annual target would be contributed by wealthy nations. It remains unresolved whether rapidly developing nations such as China or the Gulf oil states of the Middle East should also contribute, a position supported by the United States and the European Union.
By reforming the global banking system, countries hope to increase the annual sum for climate finance. UN agencies estimate that trillions of dollars are needed each year, but officials in COP29 host Azerbaijan said a number in the “hundreds of billions” had a more realistic chance of being approved by consensus.
Will COP29 succeed in achieving the energy transition?
Last year’s COP28 summit in Dubai ended with countries agreeing to “transition away from fossil fuels in energy systems” for the first time.
Since then, however, both fossil fuel use and export sales have continued to increase globally, while new areas have been approved for oil and gas production in countries such as Azerbaijan, the United States, Namibia and Guyana .
With countries and companies unclear on their decisions to abandon coal, oil and gas, negotiators said COP29 was unlikely to provide deadlines or stronger language on fossil fuels, although some countries may push to halt the permitting of fossil fuels. new coal plants.
The countries will also discuss progress in their commitment to triple renewable energy capacity and double energy efficiency, as a way to ease demand for fossil fuels.
Finalization of global carbon market rules
Governments are eager to define the rules for trading carbon credits earned through the preservation of forests and other natural carbon sinks.
While these credits are intended to be issued to nations as optional compensation for their countries’ emissions, they can also be traded on open markets. Business leaders are calling for COP29 to establish rules to ensure transparency and environmental integrity in projects registered with the Paris Agreement Credit Mechanism (PACM).
Key issues still remain to be decided, including how the PACM watchdog will set standards, whether credits will need to be assessed before being traded, and whether and when credits can be revoked.
Increase transparency
Azerbaijan hopes that countries will present first progress reports on climate action at the summit before the December 31 deadline, but it is unclear whether countries will do so.
These so-called Biennial Transparency Reports (BTRs) are intended to describe a country’s progress in meeting its climate goals – and how much further it needs to go to set new targets by February. As it stands, national commitments to reduce emissions still fall well short of what is needed, the UN said last week.
The BTRs will also offer insights into how much financing is currently needed in developing countries, both to transition their economies away from fossil fuels and to adapt to conditions in a warmer world.
Adaptation in focus
Last year, countries committed to establishing a framework of guidelines for national plans to help people adapt to climate changes such as hotter days, rising sea levels or drying farmland.
But the adaptation framework lacks details, such as quantifiable targets to measure progress or strategies for linking projects with climate finance.
Countries hope to set more specific adaptation targets at COP29.
Money for losses and damages
Two years since Egypt’s COP27 summit agreed to help poor countries cope with the costs of climate-related disasters, such as extreme floods, storms or droughts, around $660 million has been mobilized through the Loss Response Fund and to the newly created damages, which will be based in the Philippines.
Climate-vulnerable countries will ask rich nations to offer more to the fund.
