All the main topics discussed at the 29th UN Climate Change Conference
From November 11 to 24, 2024, the 19th United Nations Climate Change Conference, known as COP29, was held in Baku, Azerbaijan. This event gathered global leaders, companies, and organisations to address the climate crisis.
COP29 was the second of three major environmental summits in 2024, following COP16 on biodiversity in Cali, Colombia, and before discussions on desertification. While each conference focuses on specific topics, they are interconnected and influence the same ecosystem, making it important to view their outcomes from a broader perspective.
The Role of COPs: What Should We Expect?
Despite the criticism surrounding their effectiveness over the past decade, these summits remain vital platforms for global governance. COPs (Conference of the Parties) create unique opportunities for countries to collaborate on climate and environmental issues, keeping the debate about the climate crisis active. At Etifor, we believe these conferences are essential tools, especially when political responsibility and dialogue are more important than ever. While COPs may not provide definitive solutions, they are crucial for fostering political commitment, encouraging multilateralism, and balancing global needs.
Key Outcomes of COP29 in Baku
This year’s conference focused on turning the commitment to transition away from fossil fuels, made at COP28, into actionable steps. The main topic addressed was climate finance, which is seen as essential for achieving the ambitious objectives of the energy and ecological transition.
Climate Finance: New Collective Quantified Goal
The most anticipated and tense moment at COP29 was the negotiation of the new climate finance framework: the New Collective Quantified Goal. This goal outlines the budget that developed countries, which are primarily responsible for CO2 equivalent emissions, will provide to the poorest and most climate-affected countries.
This funding aims to facilitate the transition from a fossil fuel-based economy to one that utilizes alternative and less environmentally harmful energy sources. Decarbonization is a costly and challenging process for all nations, but it poses particular difficulties for developing countries and those with struggling economies. The UN Executive Secretary for Climate Change, Simon Stiell, referred to this fund as an “insurance policy for humanity.” He emphasized that “like any insurance policy, it only works if the premiums are paid in full and on time. Promises must be kept to protect billions of lives.”
Ultimately, at the conference in Baku, developing countries secured an increasing share of climate aid, which is projected to reach USD 300 billion per year by 2035. However, many countries at the Convention deemed this amount disappointing and inadequate, particularly those that are most vulnerable, such as small island states.
Financial Mix
The issue of funding inadequacy extends beyond just the quantity of funds; it also concerns their quality. Developing countries require approximately USD 1.3 trillion in annual aid, but only USD 300 billion is expected to come from low-interest public finance. The remaining funds will need to be sourced from private investments, multilateral development bank resources, and mobilized finance, which is private capital guaranteed by states.
While private finance is a valuable tool, it can lead to uncertainty regarding the commitments of developed countries, making them more susceptible to market fluctuations. Projects like climate adaptation, which demand significant resources and have long payback periods, may struggle to secure financing. As a result, they may be viewed as less attractive by the private sector.
Roadmap Baku-Belem
To tackle these challenges, the “Roadmap Baku-Belem” was created to reassess financial commitments ahead of COP30 in Belem, Brazil. The objectives include tripling funds for climate adaptation and prioritizing assistance for Least Developed Countries (LDCs) and Small Island Developing States (SIDS).
The Role of Europe and Developing Nations
Climate change Conferences of the Parties (COPs) serve as crucial negotiating platforms where geopolitics plays a significant role. At these events, discussions often focus more on financial aspects than on scientific issues, highlighting the importance of having prominent leaders present. This year, the notable absence of key world figures such as Joe Biden, Xi Jinping, and Ursula von der Leyen was particularly striking.
Following Donald Trump’s election and his promise to withdraw from the Paris Agreement, Europe has emerged as the primary spokesperson for the developed world. It has also been clear about the economic challenges stemming from inflation, the pandemic, and nearby conflicts. Europe has called for the participation of developing countries that significantly contribute to the climate crisis, including China, South Korea, Singapore, Qatar, Saudi Arabia, and the United Arab Emirates. These countries will have the opportunity to engage with the funding mechanisms on a voluntary basis, without any mandatory obligations—a compromise that can be seen as a partial victory.
Carbon Credits in the International Market
The agreements made during COP29 regarding the international carbon credit market merit a detailed discussion.
In the carbon market, carbon credits serve as the currency. A carbon credit represents a certificate equating to one tonne of CO2 equivalent that is either not emitted or absorbed. These credits are generated through projects that actively reduce or remove CO2 emissions. Such projects include replacing energy-inefficient technologies with modern, efficient ones, generating renewable energy (for example, through photovoltaic plants), or engaging in reforestation activities.
To generate carbon credits, these projects must meet certain criteria: they must be certified by an independent verification standard, validated by a third-party auditor, comply with the additionality principle (meaning the project would not have happened without funding from the credits), and be registered in a carbon credit registry.
At COP29 in Baku, after a decade of discussions, the terms of Article 6 of the Paris Agreement, which pertains to international trading of carbon credits, were finalized. Two significant developments emerged:
- New Market Rules: New, non-binding rules have been established that countries can follow when purchasing credits from other nations, meaning compliance with these rules is not mandatory.
- Quality Management System: The United Nations will establish and manage a system to assess the quality of activities that generate carbon credits. Companies can also finance these activities to offset part of their CO2 emissions.
The carbon credit market is complex and sensitive, often facing criticism and raising concerns about its transparency and effectiveness in addressing the climate crisis. The carbon credit agreement reflects political interest and a global commitment to regulate and enhance this market.
However, as noted by Carbon Market Watch, the outcome of Article 6 in Baku has resulted in a complex and non-binding system that places the responsibility for the integrity of this mechanism on the individual actors involved in the transactions. They state: “In the absence of better top-down regulation, the integrity of individual actors and active scrutiny from third parties will be make-or-break features of these markets.“
Etifor’s Projects
As we previously discussed regarding COP16 on biodiversity, carbon credits are not inherently all bad nor are they the ultimate solution to the climate crisis. They should, however, be part of a broader strategy focused on reducing emissions.
There are two key instruments for certifying the removal of CO2 from forests: environmental declarations and carbon credits. In both cases, there is typically a sponsoring party, such as a company, that funds the forestry projects responsible for generating the certified removals. Environmental declarations are not transferable; they are issued through direct sponsorship. In contrast, carbon credits are tradable in the market, allowing investors to buy and resell them.
For both environmental declarations and carbon credits, a certifying body must be involved. However, in the case of environmental declarations, organizations like the Forest Stewardship Council (FSC®) not only verify the removal of CO2 from trees but also assess all five ecosystem services: regulation of the water cycle, conservation of biodiversity, and the provision of soil and recreational services. This approach focuses on the overall well-being of the forest.
At Etifor, we prefer to embrace the complexity of nature rather than oversimplify it. That is why we rely on environmental declarations and develop projects from the ground up, leveraging our team of forestry experts and a science-based approach, rather than reselling projects that have already been implemented by others.
The Example of Burkina Faso
WOWnature, our unit dedicated to reforestation projects is working on a reforestation project in Burkina Faso focused on social reforestation to address local needs. Despite challenges like famine and drought, women are vital to rural communities and make up most of the workforce.
WOWnature is planting essential tree species such as Baobab, Shea, Moringa, and Neré to generate sustainable income. These trees produce marketable nuts and fruits for the food and cosmetic industries while providing shade and improving soil moisture.
The women from the Union de Femmes of Garango are responsible for planting and caring for the trees, promoting both environmental sustainability and economic independence. Supported by AES-CCC and funded by the Italian Agency for Development Cooperation, many products have received ECOCERT and WFTO fair-trade certifications, allowing us to pursue new sales channels in Europe, especially for cosmetic products like shea butter and baobab oil.
Discover the project here: https://www.wownature.eu/en/wow-area/burkina-faso/