What happened at climate COP29 in Azerbaijan?

The recent climate COP in Azerbaijan - the annual decision-making meeting for signatories to the UN Framework Convention on Climate Change (UNFCCC) - spent two weeks discussing rules for carbon markets, emissions trading and climate finance for countries in the Global South most affected by and vulnerable to climate change.

Countries, including the UK, also announced how much they pledge to reduce their emissions by in the future.

The headline from COP29 was a last-minute agreement on a climate finance goal for 2035, after unprecedented walk outs by groupings of countries - the Alliance of Small Island States (AOSIS) and Least Developed Countries (LDCs) - most affected by climate change. A new annual $300 billion target was agreed for richer countries to support Global South countries with low-carbon development and to cope with the effects of climate change. While this is an increase on the previous goal, it was some way short of the £1 trillion of investment a year many of the intended beneficiaries had called for. No specific provision is made for adapting to climate change or addressing the loss and damage from climate change within the goal. There was also frustration with the apparent reliance on the private sector to finance a significant chunk of it.

The second main development at COP29 was on carbon markets. International guidelines have been agreed allowing carbon trades between countries (Internationally Traded Mitigation Outcomes (ITMOs)) to meet targets. A new supervisory body will be created to oversee standards for carbon removals with an aim of ensuring they are credible, result in emissions reductions, and adhere to environmental and social safeguards.

It is unclear what impact this will have on UK domestic carbon markets. The Woodland Carbon Code is generally regarded as high integrity, but there are concerns that many international carbon credits achieve much lower standards¹. With the UK government considering allowing woodland carbon to be included in the UK emissions trading scheme, there is the potential for a race to the bottom on standards as UK sellers seek to remain competitive on unit costs.

Politically, some have argued that the talks took place in a parallel universe. While the consequences of climate change are increasingly clear across the world and many climate scientists anticipate the 1.5 degree target agreed at the Paris COP in 2015 will be exceeded this year², the impetus for action – particularly in the Global North – appears to be waning. This is not just a phenomenon of the United States. The UK is one of several western countries where opinion polls show a marked fall in the priority people give to the environment and climate change and a corresponding increase in concern about the cost of living³.

Given the continued failure of the annual talks to make the needed progress, some have questioned whether the whole COP process is now critically compromised⁴. Arguably, this feeling is not helped by consecutive meetings taking place in countries whose economies are heavily dependent on fossil fuel exports and the large number of delegates representing fossil fuel industries. Greta Thunberg denounced the agreement as a "death sentence" for "the countless people whose lives have been or will be ruined by the climate crisis".

Attention will now turn to COP30 which will take place in Belém, the gateway to the lower Amazon, in Brazil in November 2025. With remaining below 1.5 degrees looking increasingly unlikely, reestablishing trust and momentum will require countries to, at the very least, bring forward new emissions reduction targets, which if implemented would limit warming to less than 2 degrees.

The UK has already announced its target to reduce greenhouse gas emissions by 81% between 1990 and 2035⁵. In the spring, the Climate Change Committee will publish its Seventh Carbon Budget, setting out guidance on the actions needed to achieve this. In common with previous carbon budgets, this is likely to contain very stretching targets for woodland creation (perhaps around 50,000 hectares a year across the UK from the early 2030s, compared with 20,000 planted last year) along with better protection for existing woodland carbon.

¹Trencher, G., Nick, S., Carlson, J., & Johnson, M. (2024). Demand for low-quality offsets by major companies undermines climate integrity of the voluntary carbon market. Nature communications, 15(1), 6863.

²Mark Poynting (2024). World's first year-long breach of key 1.5C warming limit. BBC.

³YouGov (2024). The most important issues facing the country.

⁴The Elders (2024). Mary Robinson reacts to final COP29 agreement.

⁵Ed Miliband (2024). The UK’s 2035 Nationally Determined Contribution emissions reduction target under the Paris Agreement. UK government.