By Sarthak Takyar
One year ago, Renewable Watch featured a cover story on COP28, discussing the controversies surrounding it, its major achievements and its implications for India. COP28 faced criticism as Sultan Ahmed Al-Jaber, head of Abu Dhabi National Oil Company, presided over the event, precipitating concerns about conflicts of interest and greenwashing.
Nevertheless, COP28 did deliver. One of its major achievements was the release of the UAE Consensus, which included the first-ever Global Stocktake, assessing the progress since the Paris Agreement and identifying strategies for closing gaps by 2030. The key highlights of the Global Stocktake were the stated need to “transition away” from fossil fuels by tripling global renewables capacity and doubling energy efficiency by 2030. Furthermore, a Loss and Damage Fund was operationalised with $792 million in commitments, though this was well below global needs. In total, COP28 mobilised more than $85 billion in funding, including commitments to the various funds. In addition, the UAE launched the world’s largest private market climate investment fund, with a total value of $30 billion. In the energy space, the key initiatives included the Global Renewables and Energy Efficiency Pledge, which aims to establish 11,000 GW of renewable energy capacity by 2030; the Global Cooling Pledge; Mutual Recognition of Hydrogen Certification Schemes; and the Industrial Transition Accelerator, which aims to decarbonise heavy-emission sectors. New alliances and commitments included the Powering Past Coal Alliance and the Declaration to Triple Nuclear Energy by 2050.
Despite these positives, critics pointed out the risk of COP28 diluting the language in the UAE Consensus, which did not talk about phasing out fossil fuels, only transitioning away from it. Critics feared that this would create loopholes allowing for continued fossil fuel use, supported by carbon capture and “transitional fuels” such as gas. Another key criticism concerned the funding gaps, as the financial pledges fell short of the investments needed annually for global climate needs.
The diluted fossil fuel phase-out targets were in line with India’s coal dependency and national circumstances. However, developing nations such as India remained underserved due to insufficient financial commitments, impacting their ability to address climate challenges effectively.
Controversies were bound to persist in COP29, as it was to be hosted in another petrostate, Azerbaijan. But it has, perhaps, been even more controversial. While several landmark initiatives have been taken in the renewable energy and carbon market spaces, the issue of acute finance gaps was even more prominent at this COP. India categorically stated its concerns about this widening gap.
Climate finance and carbon market developments at COP29
At COP29 in Baku, Azerbaijan, which concluded on November 24, 2024, nations committed to new, ambitious funding targets, notably agreeing to triple the financial support for developing countries to $300 billion annually by 2035, up from the previous $100 billion goal. Additionally, countries committed to mobilising $1.3 trillion annually by 2035 from both public and private sources.
This agreement, formally called the New Collective Quantified Goal on Climate Finance, represents a significant step forward in global climate action. It follows important progress made at previous conferences, including COP27’s Loss and Damage Fund and COP28’s commitment to transition away from fossil fuels while expanding renewable energy.
COP29 also made significant progress on carbon markets, an area where previous conferences had struggled to reach a consensus. These developments are expected to help countries reduce emissions more efficiently and cost-effectively, supporting the goal of halving global emissions this decade.
Looking ahead, countries must submit updated nationally determined contributions (NDCs) next year, which need to be comprehensive and aligned with the target of limiting global warming to 1.5°C. According to the United Nations Framework Convention on Climate Change secretariat’s (UN Climate Change) press release on COP29, the UK and Brazil have already indicated their intention to strengthen their climate commitments in their upcoming NDCs.
Advancements in carbon markets
The conference achieved a breakthrough on carbon markets under the Paris Agreement, finalising implementation rules after nearly 10 years of negotiations. The agreement covers two main areas: bilateral carbon trading between countries (Article 6.2) and a UN-supervised carbon crediting system (Article 6.4).
For country-to-country trading, COP29 established clear protocols for authorising and tracking carbon credit exchanges, with built-in environmental safeguards and transparency requirements through technical reviews.
The new UN carbon crediting mechanism (officially called the Paris Agreement Crediting Mechanism) was approved on the first day of COP29. It includes strong environmental and human rights protections, particularly benefitting developing nations through new funding streams. The system notably requires explicit consent from indigenous peoples for projects affecting them, and provides an appeals process for affected parties. The least developed countries will receive special support enabling them to participate in the market.
The mechanism is required to align with current scientific understanding, with the supervising body mandated to incorporate the latest scientific evidence in its operations. While the framework is now established, significant work remains – the supervisory body has been given extensive tasks to complete in 2025 to fully operationalise the system.
Transparency in climate financing
Ensuring transparency in climate financing was another key highlight of COP29, with 12 countries and the EU having submitted their inaugural Biennial Transparency Reports ahead of the year-end deadline. These countries were Andorra, Azerbaijan, Germany, Guyana, Japan, Kazakhstan, Maldives, Netherlands, Panama, Singapore, Spain and Türkiye. These reports have strengthened the evidence base for climate policies and will help in identifying financing needs. Their early submission has set a precedent for other nations to follow in climate reporting transparency.
Announcements in the energy space at COP29
At COP29, several energy initiatives were announced and party and non-party stakeholders were invited to endorse them. These initiatives align with the Presidency’s commitment to advancing the outcomes of the first Global Stocktake on renewable energy and hydrogen. The initiatives are:
COP29 Global Energy Storage and Grids Pledge
Supporters pledged to collectively achieve 1,500 GW of global energy storage deployment by 2030 — over six times the capacity recorded in 2022. Additionally, they committed to adding or upgrading 25 million km of grids by 2030, with a broader goal of 65 million km by 2040.
COP29 Green Energy Pledge: Green Energy Zones and Corridors
This pledge, building on the Global Stocktake outcomes, focuses on creating interconnected power networks. The plan promotes the establishment of green energy zones and corridors to link major renewable energy generation sites with high-demand communities through expanded regional and cross-regional power grids. The aim is to facilitate reliable long-distance electricity transmission through this infrastructure.
COP29 Hydrogen Declaration
Through this pledge, endorsers committed to expanding renewable, clean and low-carbon hydrogen production while accelerating efforts to decarbonise existing hydrogen production by replacing unabated fossil fuels. This initiative aims to significantly increase annual green hydrogen production beyond the current 1 million tonnes, and reduce the 96 million tonnes of annual hydrogen production using fossil fuels.
Launch of the Global Matchmaking Platform for Industrial Decarbonisation
UNIDO and the Climate Club officially launched the Global Matchmaking Platform (GMP) for Industrial Decarbonisation. This platform, dedicated exclusively to reducing emissions in heavy-emission industries, is designed to connect the specific needs of emerging and developing economies with global technical and financial assistance. GMP is now open to receiving project and programme applications from countries, as well as expressions of interest from institutions and donors looking to join as network partners.
Launch of the Accelerated Partnership for Renewable Energy in Central Asia
The International Renewable Energy Agency, in collaboration with Azerbaijan’s Ministry of Energy, launched the Accelerated Partnership for Renewable Energy in Central Asia. This regional framework promotes cooperation among Central Asian countries to fast-track investments, enhance connectivity, and accelerate renewable energy deployment and trade.
Support for the 10 GW Lighthouse Initiative
International and national development finance institutions collectively pledged support for the 10 GW Lighthouse Initiative, which seeks to advance renewable hydrogen projects ranging from 100 MW to 1 GW in emerging markets and developing countries. The goal is to bring these projects to the final investment decision stage by 2030. As part of the COP-centred “Breakthrough Agenda”, this initiative aims to make clean hydrogen and other sustainable solutions the most cost-effective and accessible options globally by 2030.
India’s response and the way forward
COP29 highlighted a growing divide between the Global North and the Global South. India did not mince words while sharing its concerns, and made bold statements and interventions. The primary concern remained, as always, the slow and inadequate progress on climate finance commitments made by developed countries to developing countries.
At the High-Level Ministerial on Climate Finance, India, on behalf of like-minded developing countries, delivered a strong intervention. Naresh Pal Gangwar, additional secretary, Ministry of Environment, Forest and Climate Change of India and India’s lead negotiator at CoP29, stated that the increasing frequency and intensity of extreme weather events disproportionately affect people in the Global South. To this end, India called for developed countries to commit to mobilising at least $1.3 trillion annually until 2030 through grants, concessional finance and non-debt-inducing mechanisms. Such commitments, India asserted, are essential for advancing to COP30, where updated NDCs will be submitted.
India also highlighted the critical importance of transparency and trust in multilateral processes, expressing disappointment with the performance of developed countries on existing financial and technological commitments. The statement called for a clear and comprehensive definition of climate finance, aligned with the UNFCCC and the Paris Agreement, to promote transparency and build trust. It acknowledged the work of the Standing Committee on Finance but noted the need for further progress in establishing a meaningful definition.
Overall, addressing the longstanding $100 billion annual commitment from developed countries, India criticised the delay and insufficiency of the funds mobilised, which fall far short of the growing needs of developing countries.
Indian spokespersons reiterated their position at the High-Level Ministerial Dialogue on Climate Change Adaptation. Highlighting the urgent requirement for a robust flow of financial resources, India asserted, “The New Collective Quantified Goal (NCQG) for the period post-2025 needs to be an ambitious mobilisation target at grant/concessional terms. An important aspect that needs to be addressed is the slow disbursements, lack of flexibility to adapt to changing requirements and long complex approval procedures with stringent eligibility criteria that make it difficult to access climate finance.” India thus urged developed countries to fulfil their agreed financial commitments to developing countries.
Further, India emphasised that the COP28 Global Stocktake had highlighted significant shortfalls in both adaptation measures and their implementation, primarily due to insufficient resources and attention. The UAE Framework for Global Climate Resilience, adopted at COP28, recognises that developed nations must substantially increase their support to developing countries for meeting climate adaptation goals. This enhanced support should surpass previous commitments and be tailored to individual countries’ strategies, while taking into account the specific circumstances of developing nations.
At the Plenary Session of COP29, India criticised the hasty process behind the finalisation of the new finance deal (NCQG), which aims to mobilise $300 billion per annum to developing countries by 2035. India’s statement described the amount as “abysmally poor” and “a paltry sum” labelling it “too little and too distant”. Another contentious point that India flagged is the decision to raise $300 billion from various sources including private, bilateral, and multilateral, rather than relying solely on public funds from developed to developing countries. India considered it “a deflection of the responsibility of developed countries”. Another issue is NCQG’s provision that voluntary contributions can be made by developing countries to achieve the $300 billion target, which India deemed “not right”. India expressed disappointment over the shift in focus from enabling adequate climate finance to prioritising mitigation. It stated, “All countries have submitted their NDCs and will be submitting the next round of NDCs, informed by the various decisions we have taken together in the past as well as on the basis of our national circumstances and in the context of sustainable development goals and poverty eradication. What we decide here on climate finance will certainly influence what we submit next year. The attempt by some parties to further talk about mitigation is primarily a shift in focus from their own responsibilities of providing finance.” India stressed that accessible grant-based climate financing is essential for implementing new NDCs. Without proper funding mechanisms in place, climate action will be significantly hindered. India called for specific details regarding several key aspects of climate finance, including its structure, amount, quality standards, implementation timeline, accessibility, transparency measures and review processes. A total mobilisation goal of $1.3 trillion, with nearly half ($600 billion) to be provided in the form of grants or grant-equivalent resources, was advocated.
Net, net, Indian spokespersons putting forward India’s concerns at COP29 is a positive development. This is crucial, as various other developing countries in the Global South look towards India’s leadership in raising critical issues facing them, especially with respect to gaps in financial commitments made by developed countries. Despite the criticisms, COP29 saw a key victory in the form of an agreement on carbon markets, which several prior COPs had been unable to achieve. With this mixed bag of developments, it will be interesting to see what the future of climate change diplomacy will look like, as we wait for COP30 at Belém, Brazil.