COP29 left many disappointed, seen by many as a choice between failure and disaster. Fair criticism but the Paris Agreement is still delivering as it was designed to do – namely a bottom-up, consensus-driven framework.
While COP29 was mainly seen as a stepping stone to COP30, when updated national climate plans are expected to be presented, the bar was set high this year for hammering out a landmark climate finance deal. However, COP outcomes often reflect the lowest common denominator; some proposals are inevitably too modest for some and too ambitious for others.
This means success or failure is rarely a clear-cut binary. While these two weeks of COPs always capture the global spotlight, they’re merely steps in an incremental, consensus-driven process. As the European Commissioner for Climate aptly put it: ‘It is less than what we would have liked, but better than we feared’.
Climate Finance – From ‘the Rich Man Picking Up the Tab’ to ‘Passing the Buck’
High hopes this time round for a new financial framework from 2025 onwards to replace the USD 100 billion annual pledge quickly collided with reality. Estimations of annual investment needs by 2030 varied, ranging from USD 1.55 trillion to USD 6.5 trillion, and even as high as USD 9 trillion. But negotiations quickly revealed deep divides over funding levels, contribution types and the expected donor base.
The final compromise – a USD 300 billion annual target and a broader call to mobilise USD 1.3 trillion by 2035 – drew fierce criticism from developing countries and climate NGOs, with some developing nations even briefly walking out of negotiations and India delivering a scathing public rebuke. For many, the new target is both absolutely insufficient and vague.
As the European Commissioner for Climate aptly put it: ‘It is less than what we would have liked, but better than we feared’.
Yet despite attempts to throw everything but the kitchen sink during the negotiations, three core obstacles persist.
First, substantially scaling up grant-based financing, which in 2022 comprised only 28 % of public climate finance, with most of the remainder consisting of loans, will be challenging. Donors are facing fiscal tightening and increased trade tensions, and the US is expected to again withdraw from the Paris Agreement. The donor scope is another sticking point. The Annex II-based donor list from the 1992 UNFCCC is outdated, with some developing countries having since transformed into economic powerhouses. Despite divisions, voluntary contributions from non-Annex II countries will need to go further, with some ‘developing’ nations already being important contributors.
Finally, the success of the ‘Baku to Belém Roadmap to 1.3T’ will hinge on significantly increased private sector contributions. Meanwhile, private finance remains stagnant, significantly hindered by regulatory and political environment in developing countries.
Article 6, a Potential Big Win
But it’s not all doom and gloom – there were some successes at COP29. After nearly a decade of negotiations and some important groundwork laid before the conference, COP29 paved the way for an agreement on operationalising the Paris Agreement’s Article 6. This gives countries the option to collaborate on achieving their climate pledges through bilateral agreements and carbon markets, potentially cutting the costs of achieving their targets by around USD 250 billion annually by 2030.
All of this, of course, will depend on whether it’s done correctly. It’s important to ensure robust standards for international carbon credits and adequate scrutiny of bilateral agreements. These mechanisms’ effectiveness hinges on integrating strong safeguards, improving transparency and ensuring high-quality carbon credits. For the EU, all this has a limited immediate impact. Linking the EU ETS with other national emissions trading systems, as seen with the EU-Swiss ETS connection, is one pathway for encouraging cooperation. Regarding carbon markets, the EU has explicitly opted not to use international carbon credits to meet its reduction targets and doesn’t plan to reintroduce them into the EU ETS.
However, the 2026 EU ETS review will address the role of carbon removals and may open the door to discussions on international credits.
A Shaky Future for the Phase-Out Debate
COP26’s pledge to ‘phase down unabated coal’ and COP28’s call to ‘transition away’ from fossil fuels raised hopes for clearer phase-out language at COP29. However, under pressure from hydrocarbon-exporting countries and strong backing from the Azerbaijani Presidency, decisions were deferred to COP30, with the final document sidestepping the term ‘phase-out’ entirely.This echoes the G20’s recent failure to adopt phase-out language. The trend of side hydrocarbon deals and Azerbaijan’s appraisal of hydrocarbons as a ‘gift of God’ have further fuelled debates over whether fossil fuel-extracting nations should be hosting climate summits.
As such, and to much disappointment, an unequivocal commitment to a global phase-out remains unlikely within the Paris Agreement’s consensus framework. Differing views on abatement makes progress more complicated. Some countries would see this as an essential climate mitigation option alongside renewables and other clean solutions. While the IPCC has proposed definitions, political deadlock persisted through COP27 and COP28.
All of this is why we desperately need clarity on abatement. Without clear thresholds, we’ll just continue to see increasingly loud accusations of greenwashing and backsliding – and for good reason.
COPs May Not Be Fully Fit for Purpose Anymore – But the Game Isn’t Over Yet
Simply put, the world is off-track to meet climate goals. While the Paris Agreement’s ratchet mechanism aims to drive incremental ambition through good old-fashioned peer pressure and political will, there’s no guarantee that updated nationally determined contributions at COP30 will collectively deliver the emissions reductions needed to stay within the set temperature limits.
COP29 was a mixed bag because it mirrored wider geopolitical uncertainty. Many leaders didn’t attend and Donald Trump’s election definitely cast a long shadow. Initial enthusiasm for climate-neutrality pledges by 2050 has yielded to sobering realities and a rising sense of disappointment. Still, there’s reason for cautious optimism. The clean tech transition is gathering pace, supported by ambitious schemes in the US, China and the EU. Meanwhile, nations like Brazil, the UK and Indonesia have stepped up their game with more ambitious commitments, offering a glimmer of hope amidst all the uncertainty.
COP29 was a mixed bag because it mirrored wider geopolitical uncertainty.
And while the COP format guarantees broad engagement, growing dissatisfaction has spurred efforts for more ambitious actions, such as creating ‘coalitions of the willing’. But it remains to be seen whether these evolve into a parallel process.
Yes, the COP model, centred on high-profile, two-week negotiations every northern hemisphere autumn, is under increasing scrutiny for its ‘vanity fair’ optics. Despite extensive groundwork during inter-sessional meetings, last-minute COP decisions often lead to sub-optimal outcomes, with less powerful nations pressured into making concessions.
At COP29, frustration with these processes boiled over. The question is no longer if the COP framework needs an overhaul, but rather what form that overhaul might take. But regardless of how disappointing this COP was to so many, it’s far from over yet.
Irina Kustova is a Research Fellow at the Centre for European Policy Studies (CEPS) with expertise in energy transition and security, and a particular focus on EU energy markets, hydrogen and renewable gases, renewables uptake, and climate diplomacy. Christian Dietz is a Researcher in the Energy, Resources, and Climate Change (ERCC) Unit at CEPS, where he works on climate policy. Renske van Hoof is an intern in the ERCC Unit at CEPS.
This blog post was originally published on 10 December 2024 on the CEPS website.
Photo: International Renewable Energy Agency / Flickr (CC BY-NC-ND 2.0)
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