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Goal setting: Inside the COP29 NCQG
11/12/2024
8 min read
Feature
At November 2024’s UN Climate Change Conference (COP29) in Baku, Azerbaijan, countries agreed a new climate finance goal of $1.3tn/y by 2035, including $300bn/y of public finance. Together, these make up the so-called New Collective Quantified Goal on Climate Finance (NCQG). But what do these numbers mean, where do they come from, and who will have the power to make the money choices? Experts at the Grantham Institute held a webinar late last year to discuss the outcomes of the so-called ‘financial COP’, with an eye toward COP30 in November 2025 in Belem, Brazil. New Energy World Senior Editor Will Dalrymple listened in.
Head of the UK’s negotiating party at COP29 was Alison Campbell. She described the NCQG agreed in Baku as ‘imperfect’. However, she complimented the new $300bn/y sum of public finance as being ‘similar in character’ to the previous figure of $100bn/y, in that developed countries retain overall responsibility for donation. She adds that the larger $1.3tn/y target now includes outflows from (multilateral development banks (MDBs), which brings in contributions of China, Saudi Arabia and others, and encourages bilateral voluntary contributions.
‘This was important to walk a line that was true to Article 9 of the Paris agreement’s obligations’, she said, while also recognising that the world has changed since 1992, and other countries should be making donations too.
Professor Lord Nick Stern, Chair of the Grantham Research Institute on Climate Change and the Environment, pointed out that the previous $100bn figure first emerged 15 years ago, at COP15 in Copenhagen. It was derived from negotiations he was involved in as UK negotiator, with negotiators for the African Union and the US.
He recalls: ‘We had a number above $200bn and we wanted it to be public [finance], and for a medium-term target [as well in] 2015. During the course of discussions with [the US]…the numbers got changed to $100bn by 2020. And the words “and private” were added.’
He stressed that the $100bn/y figure explicitly included both government money and external finance, from the start, despite some statements to the contrary at COP29.
He went on to say, ‘It’s important to realise that this was a negotiated number, not what was necessary to deal with temperature goals.’ In fact, Stern has also been involved in what he described as a deductive process to determine the amount of investment required by geography and by sector to deliver on the Paris Agreement. (Those findings, by the Independent High-Level Expert Group on Climate Finance, were published during COP.) The figure, for emerging countries excluding China, was $400bn/y by 2035; so the present agreement fell short of that, but on the other hand, not so far off either.