The UN Cop 29 presidency has released a new draft text on the key issue of climate finance, but entrenched positions remain with no agreement on an amount, and no explicit reference to reducing fossil fuels in energy systems.
The outcome of the finance discussions are inextricably linked to progress on mitigation, or cutting emissions. Developing countries have long said they cannot decarbonise or implement an energy transition without adequate finance. Developed countries are calling for substantially stronger global action on emissions reduction.
Countries are working at Cop 29 to decide the next stage of a climate finance goal. Developed countries agreed to deliver $100bn/yr in climate finance to developing nations over 2020-25.
The draft, released in the early hours today, streamlines previous iterations. But countries' views on details such as the amount beyond 2025 are set out in separate 'options', illustrating a lack of common ground.
The text does not overtly reference phasing out or reducing fossil fuels, although it does call on the fossil fuel industry to align itself with the Paris Agreement and for phasing out inefficient fossil fuel subsidies. It is unclear if there was wide agreement on these points. Countries agreed at Cop 28 last year to "transition away" from fossil fuels.
The first option, which roughly covers developing country views, sets out a climate finance goal of upwards of $1 trillion over 2025-35, broken down into provision and mobilisation. The provision element — which developed countries would be called on to provide — is in the billions of dollars, from a $100bn/yr floor, and should be grant or grant-equivalent, according to the draft. Mobilised finance, which could be private finance or even from carbon markets, would make up the rest — although no specific figures are in this part of the draft text.
The second option, broadly covering developed countries' position, focuses on the Paris climate agreement that seeks to limit the global rise in temperature to 1.5°C above pre-industrial levels. This option sets a floor of $100bn/yr by 2035 for "collectively mobilising" finance "from a wide range of sources". It outlines a goal of $1 trillion or more for "global finance in climate action… from all sources of finance".
The contributor base has long been a point of contention. UN climate body the UNFCCC delineated developed and developing countries in 1992, and the former group has consistently argued that economic circumstances have since changed, requesting a wider contributor base for climate finance. But positions on this appear not to have changed. The first option "invites developing country parties willing to contribute" to do so voluntarily, but says this will not be counted in the official finance goal. The second option notes that developed countries take the lead, but contributions from "countries with the economic capacity to contribute" will be counted.
"This is not a text that aims to bridge", non-profit WRI director of international climate action David Waskow said today. He sees "a lot of work to be done".
Cop 29 is scheduled to finish on 22 November, but many participants said it is likely to overrun.
