The 29th Conference of Parties on climate change (COP29), in Baku, Azerbaijan, ran from 11 to 24 November (a couple of days overtime). There are multiple fronts to the COP negotiations, including (amongst others) mitigation (reducing emissions), adaptation (making changes to live with climate change), loss and damage funding (to deal with the impacts of climate change that cannot be adapted to) and financing (largely how all of the above will be paid for).
The Paris Agreement at COP21, dictates much of the current structure of negotiations, and requires parties to agree a new transnational commitment to climate financing by the end of 2024, and for them to each submit their new national emission reduction pledges around the time of COP29. This blog summarises the developments from COP29 on the financing and mitigation fronts as well as looking at the potential climate implications of the recent US election result. It reflects on how some of these developments connect to the Scottish context.
International climate finance: a ‘new collective quantified goal’
The main topic of discussion at this COP was international climate finance. As set out in previous SPICe blogs, climate finance entails any funds, public or private, that are used for investment into projects that are at least in part intended to either mitigate the impacts of, adapt to, or compensate for, climate change. International climate finance is typically that which is provided from wealthy to less wealthy countries.
The Paris Agreement requires a new international finance target by 2025, and in Baku there was much discussion about a new collective quantified goal (NCQG). The debate and disagreements around the NCQG related to various issues – the amount, who should it come from, whether it should be grants or loans, and what it should fund. For example, the funding is meant to come from Annex I countries (‘developed’) and go to Annex II countries (‘developing’), but these groupings were decided in 1992, and some argue that countries like China should now be contributing, and countries like India, no longer need to be in receipt of funds.
As part of the Copenhagen Climate Accord in 2009, a commitment was made to $100billion per year of climate finance by 2020. This target was missed in 2020, but was thought to be passed in 2022. Although this is a large number (for context, global GDP was $105 trillion in 2023) it is thought to be at least 5 times less than what is needed. The World Resources Institute estimate that:
- ‘developing countries, after deploying their own resources, will need an additional $500 billion to $1 trillion per year in climate finance from international sources.
As mentioned, there are different uses for the finance with about two thirds currently allocated to mitigation and less than a third to adaptation. The emphasis on mitigation is thought to result from these projects often involving some form of direct financial return on investment (selling renewable electricity for example), and the critical fact that all mitigation efforts, regardless of where they take place, contribute to addressing climate change the world over, whereas adaptation efforts have decidedly localised benefits. As highlighted by the UN Secretary General, climate finance can be seen as an investment to prevent global climate change, as opposed to a ‘hand-out’
After running overtime, the finally agreed NCQG at COP29 was $300bn per year by 2035. This is not seen as ambitious with reforms of development banks likely to already boost climate finance, and inflation likely to undermine the nominal increase from the previous target. Other relevant developments in the agreement included a move to further encourage ‘developing countries’ such as China to provide funds on a voluntary basis, and the aim to produce a ‘roadmap’ to reach $1.3tn annually, in time for the next COP.
A frequently cited failing of the existing finance, is that it is mainly composed of loans rather than grants. The UK has, however, historically provided mainly grants (85% since 2011), with the UK Government pledging a total of £11.6bn in international climate finance from 2021/22 – 2025/26. The overall UK aid budget has been £11-15bn pa in recent years. In 2022, 44% of global climate finance came from multilateral banks e.g. the World Bank, 35% from bilateral banks e.g. British International Investment or the French Development Agency (banks set up in one country to finance development in other countries), with the rest from private funds. Funding for loss and damage from climate change is not to be addressed by the NCQG finance and instead is covered by a separate fund, which currently stands at around $700m. At COP26, Scotland became the first country to commit to a specific loss and damage fund.
Mitigation: new emissions reduction commitments
Similar to the last COP, this year’s presidency was held by a country with a considerable vested interest in the use of fossil fuels. Baku is sometimes referred to as the world’s first oil town, with pioneering wells in the 1840s. Oil and gas account for about 90% of Azerbaijani exports and between a third and a half of its GDP (depending on the oil price). The President of Azerbaijan was strident in his defence of the oil and gas industry, calling these resources a ‘gift from the god’ and suggesting European hypocrisy following an EU deal to buy Azerbaijani gas at the time of the gas crisis 2022. It was a relatively poorly attended COP, with none of the leaders from the biggest emitting countries, China, USA, India and Russia, in attendance.
The Paris Agreement requires signatories (all 195 of them) to commit to emissions reductions and to a so-called ‘ratchet mechanism’ (that actions to reduce emissions become more ambitious over time). The technical term for these commitments is national determined contributions (NDCs), and the first UK NDC is for a 68% reduction in emission by 2030 (from a 1990 baseline). Each country’s next NDC, for 2035, is required 9-12 months ahead of COP30 (in Brazil), and thus sometime between COP29 and the end of February 2025.
The new UK Government requested advice on their new NDC from the Climate Change Committee (CCC) in August 2024 (unlike for the UK carbon budgets this request is not a statutory obligation), and this advice was delivered on 26th October. The CCC recommended an ambition of 81% reduction by 2035, with the UK Government accepting this level in a speech from the Prime Minster at COP29. This ambition is seen as ‘aligned’ with the 78% level of ambition in the UK’s Sixth carbon budget commitment for 2033-37, as the two targets have slightly different accounting scopes, with the 81% target not including international aviation and shipping, and thus being more ambitious.
Scotland is not a signatory to the Paris Agreement but, at the time of COP26 in Glasgow, the Scottish Government produced an ‘indicative NDC’. This re-stated the then 2030 interim target of 75% reduction in emissions (including aviation and shipping).
It has been a highly significant year in Scottish climate policy. In April, the Scottish Government accepted the findings of the CCC that the 2030 interim emission reduction target was no longer credible, and between September and November a new Climate Change Bill passed through parliament, repealing this target, with a new level of ambition due to be set by secondary legislation next year.
With the recent upheaval in Scottish climate ambition, it is not clear whether the Scottish Government will match the UK NDC with their own indicative version this time round. The Scottish Government welcomed the ‘ambitious new interim target‘ and it is possible the the level of UK ambitions for 2030 and 2035 will influence the eventual new level of emission reduction in Scotland. The chart below shows the five-year UK carbon budget levels (as %s), the 2030 and 2035 UK NDC commitments, the previous level of Scottish emission reduction ambition (prior to the this years Climate Change Act) and two of the expected Scottish carbon budget periods, for which ambition will be set next year.
Sources: UK carbon budget %s from the House of Commons Library and Previous Scottish ambition from Climate Change (Scotland) Act 2009 (Interim Target) Amendment Regulations 2023
Note: Previous Scottish ambition includes international aviation and shipping, as does the UK budget 2033-37. Previous UK budgets and UK NDCs do not include intl. aviation and shipping.
Scotland at the COP
The Scottish Government is not a party to the negotiations and participates in a sub-national capacity. Scotland is a co-Chair in the Under2 coalition, a network of what is described as subnational governments ‘committed to reaching net zero emissions by 2050 or earlier’. Scotland is also the new president of Regions4 a grouping of 50 sub-national governments in ‘the fields of sustainable development, climate change and biodiversity’. The Acting Net Zero Cabinet Secretary was at COP29 to ‘set the strategic direction of Scotland’s two year term as Regions4 President’, to participate in the Under2 General Assembly, and to speak at a ‘Scottish Government panel on loss and damage’.
In previous years, the Scottish Government has positioned itself as a leader on emission reductions and in terms of support for loss and damage funding. In its recent session on climate justice the Constitution, Europe, External Affairs and Culture Committee, heard that while Scotland’s credibility on the international stage was “potentially damaged” by missed climate change targets, all was not lost, that there remained an ambitious net zero target and that Scotland could still offer lessons from its decarbonisation experience. In previous years, the Scottish Government has published a report documenting the associated ‘outcomes, achievements and costs’ from their COP attendance.
US election result
A major talking point at this year’s event was the recent US election result and the return of President Trump. The USA is the second biggest national emitter and home to much of the green technological innovation that may help to deliver net zero. The President-elect has pledged to once again withdraw the USA from the Paris Agreement (that pledges to ‘hold the increase in the global average temperature to well below 2°C above pre-industrial levels’), and join the existing outsider states; Iran, Libya and Yemen. This time round it has been reported that the new administration may also withdraw from the United Nations Framework Convention on Climate Change (UNFCCC) entirely. It is, however, unclear whether this would be legal under the US constitution, without the Senate’s approval.
The next President has also committed to more drilling for oil and gas. Although it is worth noting that the USA has been increasing annual oil and gas production almost every year since 2010, and it is now, by far the largest national producer of both.
Another area that may be affected by the election result is the competitiveness of the USA in the global ‘green industrial competition‘ (the development of the green technologies and businesses). President Biden launched the Inflation Reduction Act which could provide around $600bn worth of support to green businesses that base themselves in the USA, and has sparked responses from the EU and beyond. It is not clear what approach the new administration will take to the existing green stimulus measures.
At COP29 there were still low carbon innovation developments involving the US. For example, the country and the UK signing an agreement to pool billions of pounds worth of nuclear research and development and to support information sharing. Both countries (part of a group of 31) committed at COP28 to triple nuclear capacity by 2050.
The Scottish Government launched their own Green Industrial Strategy in September 2024. The economic impacts of the Scottish net zero transition are an increasingly contentious topic and there is a SPICe blog on the ‘Economic and supply chain impacts of wind energy in Scotland’.
Current climate synopsis
Overall, there were some calls for reform of the COP process. The Club of Rome (a non-profit organisation of ‘intellectuals and business leaders’) highlighted that although progress had been made it was not delivering the required ‘change at exponential speed and scale’. The Albanian Prime Minster gave a somewhat cynical assessment of proceedings:
- “My point is, what on Earth are we doing, gathering over and over and over if there is no political will on the horizon to go beyond words and unite for meaningful action?”
Somewhat unbelievably, after over three decades of climate change negotiations, global emissions are still rising. They are expected to increase by 0.8% this year, slightly lower than the 1.3% rise in the previous year. The IPCC have said that to have any chance of limiting warming to 1.5C, global GHG emission need to peak before 2025.
/ | Total GHG emissions in 2023 MTCO2e (% of total) | Change in emissions 1990 – 2023 | Per capita GHG emissions TCO2e (2023) | Historical CO2 emissions MTCO2 (% of total) |
China | 15,943 (30) | 311% | 11.11 | 272,531 (15) |
USA | 5,960 (11) | -4% | 17.61 | 431,853 (24) |
India | 4,133 (8) | 199% | 2.9 | 62,870 (3) |
European Union (27 member states) | 3,221 (6) | -34% | 7.26 | 298,450 (16) |
Russia | 2,672 (5) | -13% | 18.66 | 121,266 (7) |
UK | 379 (1) | -50% | 5.55 | 79,777 (4) |
World | 52,963 (100) | 62% | 6.59 | 1,812,356 (100) |
Sources: GHG emission data: EU – Emissions Database for Global Atmospheric Research (EDGAR); and Historical CO2 data: Our World in Data. All emissions are territorial rather than consumption-based.
As expressed by the IPCC Chair (Scotland’s own, Jim Skea) in his opening address to this year’s COP, climate change is
- “unfolding in front of our eyes’ with ‘more intense storms, exceptional heatwaves, devastating floods and droughts, a world where food chains are disrupted, and where diseases reach new countries”.
Globally, 2023 was the warmest year on record (in the 174-year observational record). 2024 is on track to be warmer still. Ocean temperatures are not only at the highest level on record, they have been breaking the previous records by bigger margins than have previously been seen. It is believed that the oceans are warmer than at any time in at least 100,000 years. The current level of warming is around 1.3oC (above pre-industrial levels) and the most recent UN Emissions Gap report sets out that current policies will result in 2.6 – 3.1oC of warming, .
Niall Kerr, SPICe