The COP29 conference held in Baku this year aimed to address critical climate goals, including the establishment of a New Collective Quantified Goal (NCQG), the regulation of carbon markets under Article 6 of the Paris Agreement, and the advancement of outcomes from COP28's Global Stocktake in the UAE.
While significant progress was made in carbon market regulation, the NCQG agreement faced substantial criticism for falling short of the financial commitments needed by developing countries to meet their nationally determined contributions (NDCs) and adaptation plans. Observers noted a concerning regression in the transition away from fossil fuels, raising questions about the effectiveness of the negotiations.
The NCQG discussions were marked by slow deliberations in the initial week, culminating in intense negotiations during the final days. Developing nations advocated for an increase in the current annual climate financing goal from $100 billion to $1.3 trillion, emphasizing the need for developed countries to provide adequate support. However, the final agreement set a target of at least $300 billion per year by 2035, with a broader aim of $1.3 trillion annually for developing nations, which includes private sector contributions. The absence of explicit references to scaling voluntary carbon markets, previously proposed and opposed by green groups, was a notable change in the final text.
One of the most significant outcomes of COP29 was the agreement on the regulation of carbon markets under Article 6 of the Paris Agreement, a topic that has seen prolonged negotiations in previous conferences. The new methodological standards adopted for the Paris Agreement Crediting Mechanism under Article 6.4 allow for international trade of carbon credits, requiring project developers to conduct risk assessments and demonstrate contributions to sustainable development goals. This development is seen as a pivotal moment in the ongoing efforts to create a robust framework for carbon trading.
The discussions surrounding Article 6.2 focused on the technicalities of bilateral agreements for trading carbon credits, known as international transferred mitigation outcomes (ITMOs). The agreed text outlines the procedural requirements for authorizing these agreements and stipulates that revocation of authorization can only occur under specific conditions. Additionally, the establishment of an international registry for carbon credits was a contentious issue, ultimately leading to a dual-layer approach that balances data compilation with the functionality of holding ITMOs as sovereign carbon credits.
Looking forward, COP30 is set to take place in Belem, Brazil, a location that underscores the themes of nature, biodiversity, and climate loss. The Brazilian government is currently enhancing the facilities to accommodate the conference, which is expected to draw considerable international engagement, particularly given its symbolic significance as a milestone in climate negotiations. The outcomes of COP29 have left many questions unanswered, particularly regarding the implementation of the NCQG and the future of fossil fuel discussions.
Despite some progress, the overall sentiment among many countries is one of disappointment, particularly regarding the lack of commitment to phase out fossil fuels and the slow pace of negotiations on the Just Transition Work Programme. The absence of a clear path forward for these critical issues raises concerns about the effectiveness of the global climate agenda. As the world prepares for COP30, the focus will likely shift to ensuring that the commitments made at previous conferences are not only upheld but also expanded to meet the urgent challenges posed by climate change.