The election of Donald Trump as US President is casting a long shadow over the November 11-22 UN climate summit in the Azerbaijan capital Baku. Trump — a climate denier — has made it clear that he will not provide money to developing countries reeling under the impact of climate change caused by an excess of greenhouse gases (GHG) in the atmosphere, though the US is the largest GHG polluter since the start of the Industrial Age.
Trump’s action will likely have a severe impact on the summit — called the 29th Conference of Parties or COP29 — which has climate finance from developed to developing countries as the main item on its agenda. He may even take the US out of the UN Framework Convention on Climate Change (UNFCCC).
This will have a major adverse impact on climate finance from other developed countries like Japan, Canada, the UK, Australia, New Zealand and, perhaps, even the European Union. These countries reduced climate finance during Trump’s first term, when he took the US out of the 2015 Paris Agreement until the Biden administration returned in 2021. The US did not meet most of its financial pledges from 2017 to 2020, a major reason developed countries failed to meet their goal of providing $100 billion a year to developing countries by 2020. This time, the US may renege on its $3 billion pledge to the UN’s Green Climate Fund. The US did not meet its commitments under Obama or Biden administrations either, but stayed in the negotiations.
Manjeev Puri, Distinguished Fellow at the New Delhi-based think tank The Energy and Resources Institute (TERI), said in a statement a day after Trump’s election, “While past experience hasn’t been encouraging, hope must remain for the next Trump Presidency.” Aarti Khosla, Director, Climate Trends, pointed out, “The world is different from the last time Trump came to power. Climate impacts have ravaged every part of the world… Other global leaders will be expected to rise to the challenge.” Harjeet Singh, Global Engagement Director for the Fossil Fuel Non-Proliferation Treaty Initiative, said, “With COP29 aiming to secure an ambitious new climate finance goal, Trump’s election makes the already challenging path to consensus even steeper and more uncertain. As the narrow window to prevent catastrophic climate breakdown closes, the world cannot afford for its largest historical carbon emitter and top fossil fuel producer to shirk its responsibility.”
COP29 is tasked with finalising a New Collective Quantified Goal (NCQG) for finance to enable developing countries to move to clean energy and adapt to climate impacts including more frequent and more intense storms, floods, droughts, heatwaves and coastal salinity. India has been asking that developed countries provide $1 trillion per year to developing countries. A team of experts convened by the London School of Economics has reached the same figure.
According to the latest Needs Determination Report by the UNFCCC, developing nations will need $6.852 trillion between now and 2030 to meet the climate goals they have pledged —called Nationally Determined Contributions (NDCs) — under the Paris Agreement. In contrast, developed countries have met their $100 billion pledge only once since 2009 — in 2021-22, and even that is contested by developing countries and NGOs. Many countries are supposed to update their NDCs by next February, but this can become a major point of friction at COP29 due to lack of finance.
Sanjay Vashisht, coordinator of Climate Action Network South Asia (CANSA) — an umbrella group of NGOs — says , “The minimal threshold to be agreed in Baku should be no less than $1 trillion per year as public grants.” So far, an estimated 70 per cent of climate finance has come as loans rather than grants, worsening the debt burden of developing countries. There are solutions, such as the Bridgetown Initiative proposed by Mia Mottley, Prime Minister of Barbados, but that has not received much support from developed countries.
Governments of developed countries have said at previous COPs that they do not have public finances of this magnitude, but Canada-based International Institute of Sustainable Development has pointed out that government subsidies to coal, oil and gas totalled $1.7 trillion in 2022.
India has arguably the world’s most ambitious clean energy target — to have a generation capacity of 500 gigawatts (GW) from non-fossil fuel sources by 2030. It crossed the 200-GW mark in October. The country has been attracting around $50 billion annually from public and private funding for climate-related investments, and 85 per cent of that is from domestic sources. New Delhi-based think tank Council on Energy, Environment and Water has estimated that India will need $10.1 trillion to meet its long-term goal of net zero GHG emissions by 2070 but may fall short by $3.5 trillion. The latest economic survey says India will need around $2.5 trillion by 2030 to fulfil its commitments under the Paris Agreement. The government is trying to bridge a part of the financial gap through green bonds, but will still fall short.
Need for more action
The EU’s Copernicus Climate Change Service has said the 2024 summer was the hottest on record and average global temperature was over 1.5 degrees Celsius above the pre-industrial level. This crossed the aspirational goal of the Paris Agreement. The latest bulletin of the World Meteorological Organisation says concentrations of main GHGs — carbon dioxide, methane and nitrous oxide — in the atmosphere reached new highs in 2023. The UN Environment Programme (UNEP) says the gap between current emissions and what is required to stick to the 1.5-degree ceiling is massive, according to its latest report, ‘Emission cuts of 42% are needed by 2030 and 57% by 2035 to get on track for 1.5 degrees’. The UNFCCC says current NDCs are far from enough to reach this goal.
There is a clear case for more action by all countries to avert a worse climate catastrophe, but action is largely dependent on the availability of money. Right now, not only is there not enough money to mitigate GHG emissions, but there is also hardly any money for adaptation to climate change impacts.
UNEP’s latest adaptation gap report says international public adaptation finance flows to developing countries was $28 billion in 2022, in contrast to an estimated requirement of $187-359 billion per year. A recent report said just six states in India need around ₹44,470 crore ($5.5 billion) annually from 2021 to 2030. Adaptation finance is likely to be another controversial topic at COP29.
Loss and Damage
Unable to adapt to climate change impacts, almost all countries are facing losses and damage. Still, it needed many years of lobbying by NGOs for the UN to set up a Loss and Damage Fund in 2022. At that time, it was decided that the fund would be operational by the end of 2024, but so far it has received pledges for just $792 million.
With India having to spend huge sums to cope with climate-worsened losses and damage each year, this is likely to become another cause of disagreement at COP29. Vashisht says, “The loss-and-damage fund has waited very long to shape up and, considering the urgency due to climate impacts, it should start delivering resources to communities... Developed countries need to put billions into the fund as a start.”
A potential way to raise money for climate action is through emissions trading, and this will be a big item on the COP29 agenda. The process currently suffers from two major problems —the undervaluing of carbon emissions by financial markets on one hand, and greenwashing on the other. Finding a system both efficient and equitable will not be easy. The three-decade history of global climate negotiations has been two steps forward, one-and-a-half steps backward. In the current geopolitical situation, climate-hit people around the world are perhaps hoping that the half-step forward move can be maintained at COP29.
(The writer is India Manager, Earth Journalism Network)