Baku Conference Sets New Collective Climate Finance Goal

The Baku Climate Change Conference (UNFCCC COP 29) delivered what the Earth Negotiations Bulletin (ENB) describes as “a milestone agreement that will inform climate action for years to come.” Countries set a new collective quantified goal (NCQG) on climate finance. The operationalization of the market-based cooperative implementation of the Paris Agreement (Articles 6.2 and 6.4) was another major outcome. Yet, parties could not reach agreement on a number of issues.

The ENB summary report of the meeting notes that the NCQG decision “calls on all actors to work together to scale up financing to developing countries for climate action from all public and private sources to at least USD 1.3 trillion per year by 2035.” It sets a goal of at least USD 300 billion per year by 2035 for developing countries’ climate action. This money is to come from a wide variety of sources, including public and private, bilateral and multilateral, as well as alternative sources, with developed countries taking the lead. “Developing countries are encouraged to make contributions on a voluntary basis,” ENB writes.

Also in the context of the NCQG, countries agreed “to pursue efforts to at least triple annual outflows from the key climate funds from 2022 levels by 2030 at the latest.” “The decision also acknowledges the need for public and grant-based resources and highly concessional finance, particularly for adaptation and responding to loss and damage,” especially for the least developed countries (LDCs) and small island developing States (SIDS), among other vulnerable countries with significant capacity constraints, ENB notes.

The NCQG is an extension of the USD 100 billion per year by 2020 goal, and negotiations towards it were difficult. According to ENB, developed countries wanted to expand the contributor base to include “other parties in a position to contribute,” while developing countries called for a higher quantum. Some called for specific targets on the provision of public finance and finance mobilization. LDCs and SIDS called for minimum allocation floors for their groups.

The Baku Climate Change Conference saw the many years of negotiations on the modalities for setting up the Paris Agreement’s carbon markets come to conclusion. “The Article 6.2 decision will allow the Secretariat to provide registry services to countries that request it, allowing them to issue mitigation outcomes as units, and these services would be interoperable with the international registry,” the ENB analysis of the meeting explains. The Article 6.4 methodologies and removals requirements were also adopted, and “[t]he first Article 6.4 issuances can roll out as early as 2025.”

Countries also:

Extended the work programme on gender;
Provided further guidance on defining indicators for assessing progress toward the Global Goal on Adaptation (GGA);
Adopted arrangements with the new Loss and Damage Fund; and
Extended the mandate of the working group facilitating the implementation of the Local Communities and Indigenous Peoples Platform.

Parties could not reach agreement on, inter alia:

The dialogue on the implementation of the outcomes of the Global Stocktake (GST);
The just transition work programme;
Review of the progress, effectiveness, and performance of the Adaptation Committee;
Second review of the functions of the Standing Committee on Finance;
Seventh review of the Financial Mechanism;
Linkages between the Technology Mechanism and the Financial Mechanism;
Further guidance on features of nationally determined contributions (NDCs);
The report on the annual dialogue on the GST informing NDC preparation; and
Procedural and logistical elements of the overall GST process.

According to ENB, many were disappointed about the lack of agreement in Baku on whether and how to take forward the GST outcomes, especially considering the importance of the next round of NDCs, to be submitted in 2025, to avoid overshooting the 1.5°C goal.

The Baku Climate Change Conference convened from 11-22 November 2024 in Baku, Azerbaijan. It consisted of the 29th session of the Conference of the Parties (COP) to the UNFCCC, the 19th meeting of the Conference of the Parties serving as the Meeting of the Parties to the Kyoto Protocol (CMP 19), the sixth meeting of the Conference of the Parties serving as the Meeting of the Parties to the Paris Agreement (CMA 6), and the 61st sessions of the Subsidiary Body for Scientific and Technological Advice (SBSTA 61) and the Subsidiary Body for Implementation (SBI 61). [ENB Coverage of Baku Climate Change Conference]