Cop29 seeks an off-ramp from the ‘road to ruin’

Cop29 via Flickr

You cannot accuse the Azerbaijani presidency of Cop29 – the global climate summit that opened today in Baku – of failing to take the subject seriously.

“Colleagues, we are on a road to ruin,” said Mukhtar Babayev, the president of the 10-day event, in his opening remarks. It doesn’t get much bleaker than that.

It is not just that, according to figures from the UN Environment Programme, the world is destined to warm by 3C by 2050 – double the 1.5C target in the Paris Agreement, which scientists say can mitigate the most severe impacts of climate change.

Nor is it that the world has failed to come up with the trillions of dollars needed to ease a transition to fuel sources less harmful than hydrocarbons, and is still measuring its commitment in (barely) hundreds of billions, after many years of trying.

Nor is it that attempts to establish and regulate global carbon markets have foundered on national self-interest and financial complexity.

All these present huge problems for the delegates from nearly 200 national and regional groups in Baku.

But, coming just a few days after the election of Donald Trump for a second stint in the White House, the momentum to tackle climate change has been slowed. The US – the world’s biggest economy and biggest producer of oil and gas – will be led by a self-declared denier who is planning to pull out of the lodestar Paris accord for the second time.

Unctad now estimates that energy transition will cost $5.8 trillion per year until 2030

Babayev is keen to get it all back on track, but in many ways this is not a Cop where big gestures – at least on environmental measures – can be considered.

Last year’s Cop28 in Dubai produced the “UAE consensus”, when the delegates agreed for the first time to “name and shame” fossil fuels and call for them to be phased out.

Cop29 – taking place in a major oil producer with extensive representation from the global oil industry – is unlikely to go much beyond that language.

Likewise, the Baku Cop will not be the arena where big commitments to limit greenhouse gas emissions will be announced. New nationally determined contributions (NDCs) – the voluntary mechanisms by which individual countries reduce their CO2 levels – will not be set until next year’s Cop30 in Belem, Brazil.

So, as Sultan Al Jaber, outgoing Cop president and CEO of Adnoc, made clear, this will be a “financial Cop”, seeking to deliver on and augment previous pledges essential to combat climate change.

The problem is that the gap between pledges and requirements is so huge that Baku will be hard pressed to bridge the divide.

It was way back in 2009 that the Cop first identified a target – $100 billion – for a “loss and damage” fund to compensate developing countries for the cost of global warming and help them pay for measures to adapt and mitigate the effects of excessive CO2 emissions.

It was only at Cop28 that the parties managed to get close to that figure, but already the climate change realities mean it is much too little and much too late.

The UN trade body Unctad estimates that energy transition will cost $5.8 trillion per year between now and 2030 if the 1.5C target is to remain achievable.

So, the immediate challenge for Cop29 is to show that Baku has the “convening power” to get governments – as well as the global financial system, the development banks and multinational corporations – to come up with something approaching that staggering amount.

The top priority for Babayev is to produce what has been called a “New Collective Quantified Goal”. Remember the abbreviation NCQG because you will hear it a lot in the next fortnight.

The doubts around that are legion. Who will make up for the (presumed) absence of the US? Will China – still regarded as a “developing country” in the UN taxonomy – step up to the plate?

Can the private sector be counted on to entice investors into the NCQG? How will the development banks even begin to attract such an enormous commitment from their partners and contributors?

And – no small point – which country or organisation can be entrusted with the job of administering and dispensing this mind-boggling amount of money, especially in today’s highly polarised world?

By the time Cop29 signs off its formal concluding statement on November 22, we may have inched nearer to a deal on a NCQG and away, perhaps, from the “road to ruin”.

Frank Kane is Editor-at-Large of AGBI and an award-winning business journalist. He acts as a consultant to the Ministry of Energy of Saudi Arabia and is a media adviser to First Abu Dhabi Bank of the UAE