Podcast: reflections on key outcomes of COP29

Our panelists shared their reflections through the lens of specialist legal advisors spanning multiple practice areas, including Environment and Climate, Carbon Markets, Energy, Natural Resources and Infrastructure, Project Finance and International Trade.

In this article, we outline the key topics explored in the podcast (originally a live webinar which was recorded on Tuesday, November 26, 2024).

Climate ambitions and nationally determined contributions (NDCs)

Podcast timestamp: 04:24-10:15

• Parties are obliged to submit updated NDCs by February 2025, which are to contain targets and measures for 2035. A few countries, notably the U.K., Brazil and the UAE, have already announced their NDC targets.
• There was no agreement at COP29 on implementing the global stocktake outcomes and on guidance for developing updated NDCs; decisions on the content of the “UAE dialogue” established at COP28 to implement the global stocktake outcomes, was moved to COP30.
•  It remains to be seen if NDCs will reflect the global stocktake outcomes, including: (i) tripling of renewable energy capacity by 2030; (ii) doubling of the global average annual rate of energy efficiency improvements by 2030; (iii) transitioning away from fossil fuels in energy systems; and (iv) conserving, protecting and restoring nature and ecosystems.

Article 6.2 and Article 6.4 carbon trading mechanisms

Podcast timestamp: 10:15-20:24

Issues explored include:

• key developments for Article 6.2, including on transparency, integrity and inconsistencies;
• key developments for Article 6.4, notably the operationalization of the mechanism; and
• critique and next steps for Article 6.4.

New Collective Quantified Goal on climate finance (NCQG)

Podcast timestamp: 20:24-32:50

Issues explored include:

• the background to the NCQG;
• key contentious matters, including the quantum and structure of the goal and the contributor base;
• what was agreed: a USD300 billion core target for developed countries amidst a broader call for all actors to scale up financing to at least USD1.3 trillion; and
• the significance and potential impacts of the NCQG on climate finance flows, e.g. on multilateral banks and multilateral climate funds, types of funding instrument, and shifting risk appetites.

Sectoral pledges and declarations

Podcast timestamp: 32:50-36:58

Several initiatives in the COP29 Presidency’s Action Agenda allowed endorsers to voluntarily indicate an intent to contribute to implementing the outcomes of the first global stocktake. For example:

• Global Energy Storage and Grids Pledge – Building on COP28’s pledge to triple renewables installed capacity, this pledge aims at deploying 1,500 GW of energy storage in the power sector globally by 2030, more than six times the level of 2022, and to set a 2030 global grid deployment goal. The strong endorsement by national grid operators could lead to increased cross-border connections and standardization to unlock international projects.
• Hydrogen Declaration – Compared to previous pledges, this declaration does not focus on capacity targets. This is consistent with the reality check that numerous projects face as they work towards final investment decisions. The declaration calls for stronger demand-side support measures aimed at helping projects close the business case. The renewed call for greater standardization of low-carbon hydrogen definitions is also welcome. The declaration received support from several countries (including the U.S.) and industry associations.
• Declaration on Green Digital Action – The ambition in this declaration appears relatively subdued, highlighting the increasing pressure on an industry whose GHG emissions are set to rise quickly as a result of the rapid development of AI.

Mitigation and adaptation

Podcast timestamp: 36:58-39:36

COP29 did not set a strong or decisive tone for climate mitigation and adaptation. Notably:

• the decision text on the Mitigation Work Program did not send a clear signal to implement previous relevant commitments and countries did not agree on a roadmap for taking forward the outcomes of last year’s global stocktake; and
• an Adaptation Road Map will be launched but an operational framework for the Global Goal on Adaptation may only become available at COP30. The latest UN figures indicate that even the doubling of adaptation finance will be far from meeting adaptation needs.

Recent bright spots outside COP29

Podcast timestamp: 39:36-44:08

• The U.K.-led Global Clean Power Alliance (launched at the recent G20 summit): 12 countries across the global north and south signed up to its first mission to support building of investment platforms to unlock private finance to further the tripling of renewable energy and doubling of energy efficiency.
• The coalition on phasing out fossil fuel incentives including subsidies (COFFIS): The coalition’s membership grew to 16 countries who have committed to publishing an inventory of their fossil fuel subsidies and to developing national action plans for phasing out those subsidies. Members are due to present those plans at COP30.
• The U.K. Transition Finance Market Review (TFMR) recommendations: Implementing the recommendations will require public-private collaboration, including to develop granular sectoral decarbonization pathways and test innovative financing solutions. See here for our summary of the TFMR’s recommendations in October 2024, further to our role as legal advisor to the TFMR secretariat.
• There is a growing focus on transition planning by nations, corporates and financial institutions. More broadly, further policy reforms will be necessary to put economies on a pathway to hold global warming to below 1.5°C and to address biodiversity, adaptation and social issues. For an overview of recent biodiversity and COP16 developments, please refer to our recent bulletin.

U.S. climate policy predictions

Podcast timestamp: 44:08-50:33

Should you have any questions regarding the topics covered in this webinar, please get in touch with our panelists or your usual contact at A&O Shearman.