Key Highlights from COP29 in Baku

The UN Climate Change Conference COP29, held in Baku, Azerbaijan, has concluded with a series of significant commitments and agreements aimed at addressing climate change. Despite the absence of key European leaders, delegates from nearly 200 countries gathered to discuss the challenges of climate and nature and develop solutions.

One of the most notable achievements at COP29 was the agreement on carbon markets. This decision makes country-to-country trading and a carbon crediting mechanism fully operational. The agreement is expected to put a price on emitting greenhouse gases and incentivise countries and companies to reduce emissions.

Another top priority for COP29 was to establish a new climate finance goal. After tough and prolonged negotiations, a goal of tripling annual finance to developing countries from the current US$100bn to US$300bn by 2035 was agreed upon. Institutions such as the World Economic Forum had dubbed the event the "Finance COP".

In addition to carbon markets and climate finance, several countries made significant pledges. The UK has pledged to cut emissions by 81% from 1990 levels by 2035. The United Arab Emirates plans to reduce its GHG emissions from 2019 levels by 47% by 2035. Brazil has pledged to reduce its CO2 emissions by 59% to 67% by 2035 compared to 2005 levels.

Business leaders ranked the 2024 conference lower than in previous years, but climate-related terms such as climate change, decarbonisation, and energy transition are still important to them. 25 countries, including the UK, Canada, France, Germany, and Australia, committed to building no new coal-fired power plants.

The key focus of COP29 was climate finance. The new finance goal of US$300bn per year by 2035 is an insurance policy for humanity amid worsening climate impacts. The decision made in Baku now provides clarity on how countries will authorise the trade of carbon credits and how registries tracking this will operate.

The achievements on carbon markets stand out as some of the most notable from this year’s event. However, COP29 failed to reaffirm the previous year’s commitment to transition away from fossil fuels. Attention is now turning to COP30, which will take place during November 2025 in Belém, Brazil. Energy transition and the role of nature for fighting climate change are expected to be key focuses at COP30.

Meanwhile, the US remains absent from the global climate change discussions. COP29 took place without the support of the US, which contributes around 13% of annual global carbon emissions. US President-Elect Donald Trump is expected to pull the United States out of the Paris climate agreement again.

Despite this setback, the Global Energy Storage and Grids Pledge was launched at COP29, aiming to increase global energy storage capacity to 1,500 gigawatts by 2030. The countries participating in the initiative include the United States, Germany, Japan, South Korea, Australia, and the United Kingdom. 11 multilateral development banks also announced that their annual collective climate financing for low- and middle-income countries will reach US$120bn by 2030.

In conclusion, while COP29 faced challenges, significant progress was made in the areas of carbon markets, climate finance, and energy storage. The commitments made by countries and the agreements reached at COP29 are crucial steps in the global fight against climate change. As we look towards COP30 in 2025, it is essential that all nations continue to work together to address this pressing issue.