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All eyes on Rio: As the summit heads towards final negotiations on Friday, COP29 President Mukhtar Babayev has attention firmly fixed on the G20 summit’s conclusions today. Member countries account for 85% of global GDP and 80% of emissions, and will be critical in providing clear mandates to address the climate crisis, Babayev said at a COP Presidency presser yesterday (watch, runtime: 30:45).
The key sticking points in this final stretch? Saudi leads a group of countries that don’t want the final agreement to include steps outlining how countries will transition away from fossil fuels and embrace greener energy. Saudi, the UAE and China are also resisting pushes to contribute to a fund to help developing countries transition — backers want a USD 100 bn goal (agreed a decade ago) to be bumped up to USD 1 tn, the Financial Times notes. The primary challenge lies in reaching an agreement on the New Collective Quantified Goal (NCQG), with Egypt’s Environment Minister Yasmine Fouad and Australian Climate Change and Energy Minister Chris Bowen tapped to head negotiations, The Guardian writes.
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A HANDFUL OF FINANCE UPDATES-
#1- AIM for Climate expands investments to USD 29.2 bn: The Agriculture Innovation Mission for Climate (AIM for Climate) — co-led by the UAE and the US — announced it is beefing up its investments in climate-smart agriculture and food systems by over 70% to reach USD 29.2 bn, according to a statement (pdf) issued yesterday in COP29. The initiative also added 200 more partners and 52 new innovation projects to its pipeline, bringing the total to 800 and 129, respectively.
Green agriculture gets a boost: AIM for Climate’s projects will target smallholder farmers in low and middle income nations, emerging technologies, and methane reduction, and aims at scaling up public-private partnerships, the statement said.
#2- African nations at COP29 have called for a USD 1.3 tn in annual climate finance for developing countries by 2030, The East African reports. Led by Kenya and Tanzania, the African Group of Negotiators (AGN) reiterated their calls for reliable, grant-based funding from wealthier nations to support adaptation and mitigation efforts, rejecting debt-heavy solutions in the New Collective Quantified Goal (NCQG).
The AGN is putting its foot down: “Africa’s needs are non-negotiable,” Kenya’s climate convoy and chair of AGN said. The public call comes as frustration built up in this COP29 over slow progress on new pledges and the lack of accountability for the previous USD 100 bn pledge, reports the East African.
Sound familiar? The USD 1.3 tn figure was initially suggested back in 2021 and proposed at COP 26 in Glasgow, Reuters writes.
#3- CIF is queuing up a bond issuance: The Climate Investment Funds (CIF) has listed its bond issuance program on the London Stock Exchange, marking the final step in the design and structuring of the Capital Markets Mechanism (CCMM) first announced at COP26, according to a statement. CCMM will now begin courting investors as it lines up its inaugural bond issuance.
What is CCMM? CCMM aims to use its strong balance sheets to mobilize USD 75 bn from private capital to finance climate action in developing countries and from frontloading reflows CIF’s Clean Technology Fund (CTF). The mechanism will focus on funding low-carbon technologies, including renewable energy, energy efficiency, sustainable transport, and green industry projects in developing countries, CIF said in a statement.
ADVISORS- The bond issuance is managed by BNP Paribas, HSBC, BofA Securities, and TD Securities. The World Bank and the African Development Bank will be acting as CIF’s trustees, and the latter is set to take over as the host of the fund’s Secretariat, according to a statement last week.
ON THE POLICY SIDE-
BTRs begin rolling in at COP: The first biennial transparency reports (BTRs) were submitted by 11 countries marking the full operationalization of the enhanced transparency framework under the Paris Agreement, Azerbaijan State News Agency Azertac reports. Andorra, Guyana, Panama, Japan, Spain, Turkey, Maldives, the Netherlands, Kazakhstan, Germany, and Singapore have all submitted their reports — which are crucial for tracking achievements, identifying gaps, and refining climate policies. “The BTRs build a robust evidence base that enables governments to refine and strengthen climate policies” and build a comprehensive picture of progress and needed additional action, UNFCCC Deputy Executive Secretary Noura Hamladji said. The deadline for submissions is 31 December 2024.
FRESH INK-
#1- US + UK partner on nuclear tech: The UK and the US have signed an agreement to accelerate the deployment of advanced nuclear technologies for civilian purposes, according to a statement. The collaboration aims to pool USD bns in research and development to make advanced nuclear technologies available for industrial use by 2030. The initiative focuses on advanced modular reactors, which can help decarbonize energy-intensive and hard-to-abate industries such as aviation fuel, hydrogen, and steel production. The new agreement will be effective from March 2025.
Others may join, but Russia is not allowed: Other players are expected to join the treaty, such as Canada, France, Japan, Korea, South Africa, China, Switzerland, and Australia, while Russia was explicitly singled out as barred from future R&D collaboration on nuclear.
#2- Volts and AIC partner to build energy storage facility in Azerbaijan: The UAE’s energy storage system manufacturer Volts and the Azerbaijan Investment Company (AIC) signed an agreement last week to establish a USD 20 mn energy storage production facility in Azerbaijan, according to a press release. The facility will be funded equally by AIC and Volts UAE, each contributing USD 10 mn.
Volts has major manufacturing projects lined up: US-based conglomerate Honeywell and Volts are partnering on the UAE’s first gigafactory for the production of battery cells for Residential Energy Storage Systems (RESS) in Abu Dhabi. Schneider Electric also signed an MoU with the UAE’s energy storage system manufacturer Volts to establish a battery energy storage systems (BESS) industrial facility in Abu Dhabi last December.
