COP29 review: industry experts’ take on the outcomes of COP29

Activists protest, demanding leaders “stand up for trillions, not billions” in climate finance during the final negotiations of COP29. Credit: UNclimatechange / Flickr

This November, more than 60,000 delegates from governments, industry and civil society organisations descended upon the capital city of Baku in the petrostate of Azerbaijan to advance global climate action. 

COP29 was dubbed ‘the finance COP’ due to its primary focus on deciding the New Collective Quantified Goal for Climate Finance (NCQG), a global climate target originally agreed upon at COP15 in 2009 for developed countries to fund climate mitigation and adaptation in developing countries. 

However, delegates remained in deadlock over the NCQG amount throughout the conference, which eventually ran over by more than 30 hours, until fixing a goal of $300bn – widely hailed as inadequate to halt the swiftly advancing global climate crisis.

Nevertheless, this year’s summit yielded some valuable outcomes that stakeholders found encouraging, particularly the progress on the international carbon market and new commitments to advancing green technologies.

As the dust settles on COP29, Power Technology speaks to industry experts on how the key decisions will impact the energy industry in the coming years.

According to a 2024 report released during COP29 by the Independent High Level Expert Group on Climate Finance, developing countries need $1trn a year in external climate finance by 2030 and up to $1.3trn by 2035. 

However, the conference concluded with a decision to set the NCQG at only $300bn per year by 2035, although the agreement calls on parties to scale this up to $1.3trn. 

According to Bruce Douglas, CEO of the Global Renewables Alliance, the newly agreed target is “far too modest”.  

A spokesperson from the International Energy Agency (IEA) agrees, telling Power Technology: “The goal of mobilising at least $300bn core climate finance per year sets an important foundation, but it will be essential to quickly scale this up to at least $1.3trn per year from all sources by 2035 to meet the urgent needs of emerging and developing economies.” 

Cheryl Senhouse, finance innovation director at the Caribbean Climate-Smart Accelerator, explains that not only is the amount inadequate but “the agreements surrounding the deployment of the $300bn lack sufficient detail”.  

“While the draft text acknowledges a mix of public and private sources, it does not specify binding allocations nor robust enforcement mechanisms, and it stops short of identifying the financial mechanisms that will be used to disburse funds to recipients to ensure equitable distribution,” she says. 

She also points to the over-reliance on voluntary contributions as a serious concern, before emphasising the need for greater specificity around the kinds of climate finance available and further collaboration to create economies of scale for efficient use of funding. 

Ritu Bharadwaj, principal researcher in climate governance and finance at the International Institute for Environment and Development, adds: “This funding will only be meaningful if it helps stabilise economies already under strain from mounting climate risks and doesn’t exacerbate existing debt burdens.  

“Debt relief is essential in this context. Countries struggling with both climate impacts and high debt levels cannot afford to prioritise resilience or recovery.”  

Following the 1997 Kyoto Protocol that outlined global emission reduction targets, the 2015 Paris Agreement established Article 6.2, allowing countries to voluntarily trade emission reductions, and Article 6.4, a UN-supervised centralised carbon market.  

Now, after almost a decade of work and stalled negotiations, the world has specified guidelines to manifest these plans into existence. 

COP29 reached an agreement on methodological requirements and carbon removals for Article 6.4 to make international carbon trading operational.  

The agreement detailed standards for countries to authorise carbon credit transactions and manage tracking registries, including mandating countries to publish information when they formally approve Internationally Traded Mitigation Outcomes, the units used for emissions trading, alongside mechanisms for technical reviews on environmental and human rights. 

“This will be a game-changing tool to direct resources to the developing world and help us save up to $250bn a year when implementing our climate plans,” says Yalchin Rafiyev, COP29 lead negotiator. 

Industry figures also expressed enthusiasm about the progress made at COP29, with Julien Hall, pricing director at carbon credit marketplace Climate Impact X, saying that “going forward there will be stability around carbon trading policies” thanks to this agreement and that “projects will be more bankable because there will be less uncertainty around carbon policy”. 

However, experts from independent watchdog and research organisation Carbon Market Watch (CMW) say that the original flaws of Article 6 have not been fixed. For example, there are no penalties for countries that fail to abide by rules, no deadline to act and projects originally established under the Kyoto Protocol will not face reassessment for quality of credits when transferring to the new Article 6 mechanism. 

In addition, they note that information detailing countries’ formal approval of carbon credits and trade deals may not come until late for credits purchased by companies in the Voluntary Carbon Market or the UN’s CORSIA offsetting scheme. 

“Offering marginal improvements to transparency provisions, the package does not shine enough light on an already opaque system where countries won’t be required to provide information about their deals well ahead of actual trades,” Jonathan Crook, CMW policy lead on global carbon markets, told CMW News.  

“Even worse, the last opportunity to strengthen the critically weak review process was largely missed. Countries remain free to trade carbon credits that are of low quality or even fail to comply with Article 6.2 rules, without any real oversight.” 

Federica Dossi, CMW policy expert on global carbon markets, added: “Article 6.4 credits will need to be better than the units sold as part of the Clean Development Mechanism under the Kyoto Protocol, which did not include stringent standards to take into account factors like additionality and leakage.” 

At the same time, the power sector saw progress with green technologies at COP29, with new pledges on energy storage, grids, green corridors and hydrogen. 

The Global Energy Storage and Grids Pledge targets a goal of 1.5TW of global energy storage by 2030, marking a sixfold increase from 2022 levels, in addition to doubling grid investment and developing 25 million kilometres of grid infrastructure.  

Douglas says that amid the “mix of progress and missed opportunities” at COP29, “the pledge on energy storage and grids, which has already been supported by multiple countries, sent a very strong signal”.  

“The proposed global targets, if met, have the potential to transform the energy sector,” he says. 

To supplement this commitment, the Green Energy Zones and Corridors Pledge focuses on developing larger intraregional and interregional connected power grids to better link green energy zones and corridors.  

Finally, the COP29 Hydrogen Declaration puts forward a commitment to expand the deployment of zero-emission and low-carbon hydrogen, although without specifying targets. 

Douglas adds that the sidelines of the conference saw significant action for green technologies. For instance, he describes the launch of the UK’s Global Clean Power Alliance, which 12 countries have joined, as a “meaningful step” towards international collaboration in financing renewable energy. 

“Additionally, the Clean Energy Transition Partnership’s plan to unlock $41bn in public finance for renewables was a significant outcome.”

According to Douglas, the energy sector must now focus on persuading policymakers to establish enabling conditions to scale renewable energy deployments. “This includes supporting accelerated and streamlined permitting processes and securing supply chains to meet growing demand,” he says.

While solar is booming, he believes that more attention should go towards other technologies such as long-duration energy storage, wind and geothermal energy, “which are not developing at their full potential but are critical for balancing the energy system”.

Douglas concludes by emphasising the need for fossil fuel subsidies, which still exceed $600bn annually, to be “urgently redirected to renewables” to scale the transition.

Countries are set to negotiate further details on key issues from COP29, including the NCQG, carbon markets, global stocktake and Loss and Damage Fund, at the Bonn intersessional talks in June 2025.