Note4Students
From UPSC perspective, the following things are important :
Prelims level: Climate Change; New Collective Quantitative Goal; Evolutions in Global Climate Finances;
Mains level: NA
Why in the News?
At the upcoming COP29 in Baku in November this year, Azerbaijan, the primary discussion will center on the New Collective Quantitative Goal (NCQG) for climate finance.
Recent Climate Conferences and Decisions:
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What is the New Collective Quantitative Goal (NCQG)?
- A new climate finance goal, known as the NCQG or the post-2025 climate finance goal, is being discussed by the Meeting of the Parties to the Paris Agreement (CMA).
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- All the parties of the Paris Agreement participate and review the implementation of the Agreement and make decisions. CMA is held once a year.
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- This goal will start with a target of at least $100 billion per year, focusing on the requirements and priorities of developing countries.
- It will replace the previous commitment of USD 100 billion per year that developed nations had pledged in 2009 but never delivered.
NCQG: A timeline
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Financial Requirements for Effective Climate Action:
- Current Funding Gaps: The scale of annual climate finance has consistently fallen short of the $100 billion promised by developed countries.
- Projected Needs: Developing countries require about $6 trillion annually until 2030 to implement their climate action plans, according to a 2021 UN Climate Change report. An updated version of this report is expected to raise this figure even higher.
- Global Transition Costs: A global transition to a low-carbon economy is estimated to require about $4-6 trillion every year until 2050.
- Renewable Energy Expansion: Tripling renewable energy capacity, as agreed in Dubai, is estimated to cost $30 trillion until 2030, per the International Renewable Energy Association (IRENA).
Prospects for Meeting Financial Targets:
- Realistic Expectations: Discussions are ongoing, with India suggesting a target of at least $1 trillion per year, primarily through grants and concessional finance.
- Challenges: Developed countries have historically fallen short of even lesser goals, and achieving trillions in finance is seen as ambitious.
Back2Basics: Global Initiatives for Financing Climate Action
| Established | Purpose | How it Works | |
| Green Climate Fund (GCF) | 2010 | To support developing countries in adaptation and mitigation to counter climate change. | Mobilizes funding from developed to developing countries to reduce greenhouse gas emissions and enhance climate resilience. Operates under the UNFCCC financial mechanism. |
| Global Environment Facility (GEF) | 1991 | To tackle global environmental issues while supporting national sustainable development. | Provides grants for projects related to environmental conventions (biodiversity, climate change, international waters, land degradation, ozone layer, organic pollutants). Functions as a financial mechanism for multiple conventions including the UNFCCC. |
| Climate Investment Funds (CIF) | 2008 | To bridge funding and learning gaps for cleaner technology transformations. | Offers scaled-up financing to middle-income countries to initiate cleaner technology transformations. Includes funds like the Clean Technology Fund (CTF) and the Strategic Climate Fund (SCF). |
| Adaptation Fund | 2001 | To finance concrete adaptation projects in developing countries party to the Kyoto Protocol. | Financed by a share of proceeds from CDM project activities, it supports concrete adaptation projects in vulnerable communities. |
| Special Climate Change Fund (SCCF) | 2001 | To finance projects in adaptation, technology transfer, and various management sectors. | Managed by the GEF, supports projects in sectors not directly funded through other funds such as energy, transport, and waste management. |
| Least Developed Countries Fund (LDCF) | 2001 | To support the least developed countries (LDCs) in their climate change initiatives. | Finances the preparation and implementation of National Adaptation Programmes of Action (NAPAs) which identify priority activities for LDCs to adapt to climate change. |
| Carbon Pricing Mechanisms | NA | To internalize the cost of GHG emissions, incentivizing emission reductions. | Involves setting a price on carbon emissions either through carbon taxes or emissions trading schemes (ETS), encouraging businesses to reduce emissions. |
| Nationally Determined Contributions (NDC) Partnership | 2016 | To enhance cooperation to achieve NDC goals under the Paris Agreement. | Facilitates technical and financial support to help countries implement and enhance their NDC commitments for reducing emissions. |
PYQ:[2016] With reference to the Agreement at the UNFCCC Meeting in Paris in 2015, which of the following statements is/are correct?
Select the correct answer using the code given below: (a) 1 and 3 only |
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