Last year’s COP28, hosted by the UAE, was a major milestone for climate change. Nations representing two-thirds of the global GDP committed to tripling renewable energy by 2030. Significant progress was made across several topics, including methane, agriculture, and nature.
COP29: Key achievements
Building on this momentum, COP29 in Baku concluded on November 24 with an agreement on carbon markets, finalising the last key mechanism of the 2015 Paris Agreement. This establishes the rules of a market-based mechanism for countries to trade their emissions and thereby reduce them more efficiently, potentially attracting significant amounts of capital into the system.
In addition, a landmark Insurance Policy for Humanity was established, as Simon Stiell, Executive Secretary of United Nations Framework Convention on Climate Change put it: An agreement aiming to provide $300 billion in climate finance annually by 2035, tripling the previous $100 billion goal. It also aspires to mobilise the more ambitious $1.3 trillion that climate-vulnerable countries were pushing for.
UAE’s continued leadership at COP29
At COP29, the UAE, despite being a prominent energy leader, continued to demonstrate leadership in the transition and urged nations to honour their commitments made at COP28. It announced plans to invest Dh200 billion ($55 billion) by 2030 to meet sustainable energy demand and achieve its net-zero target.
It also launched the Global Energy Efficiency Alliance, aiming to double annual energy efficiency rates by 2030. By COP28, the UAE had invested over $50 billion in renewable energy projects across 70 countries, with plans for the same projection in the next decade, according to the UAE’s First Long-Term Strategy (LTS) by the UAE Ministry of Climate Change and Environment.
Notably, the UAE significantly increased its ambition in a new, third Nationally Determined Contribution (NDC). It increases the country’s emissions reduction target from 19 per cent in 2030 to 47 per cent in 2035. F-gases are introduced in its emissions inventory, and more ambitious sectoral targets are set across industry, transport, waste, buildings, and agriculture. The new NDC also builds on COP28’s outcomes through initiatives like ALTÉRRA, a $30 billion climate investment fund, and institutionalises mechanisms for youth engagement in climate action.
To support the transition, the UAE has established comprehensive policy frameworks. A new decree mandates emissions reporting and requires organisations to contribute to a 31 per cent reduction in emissions by 2030 in line with its NDC commitments. Additionally, the UAE Energy Strategy eliminates coal and targets net-zero emissions in the power sector by 2050.
Progress in sustainable energy
The UAE is emerging as a leader in sustainable development, driving advancements in sustainable energy and industrial innovation. The Barakah Nuclear Power Plant recently became fully operational with all four units, generating 40 TWh or one-quarter of the UAE’s electricity needs. The Mohammed bin Rashid Al Maktoum Solar Park continues expansion towards its 5 GW target by 2030, while the 2 GW Al Dhafra Solar PV Plant started operations in 2023 and became the world’s largest single-site solar installation. The UAE aims to develop 100 GW of renewable capacity globally by 2030, with ambitions to later double this capacity.
In addition to these energy-related initiatives, the UAE invests heavily in technological innovation to drive sustainable growth and diversify its economy away from oil. Emirates Global Aluminum achieved a global first in producing aluminum using solar power and is developing a new generation of smelting technology that promises 22 per cent higher productivity with lower emissions. The Al Reyadah facility, the world’s first commercial-scale carbon capture plant in the steel industry, sequesters 800,000 tons of CO2 annually, with plans underway to expand carbon capture capacity to 10 million tons annually by 2030. Furthermore, the UAE is pushing for circular economy practices across key sectors such as manufacturing, food production, and infrastructure, while driving sustainable transport through the completion of its first national rail network.
The path forward
Despite the significant progress the UAE has made in advancing sustainability and climate action, the conclusion of COP29 reminds us that much more is needed on a global scale. The outcomes of COP29 highlight the urgency for all nations to accelerate their efforts and deepen collaborations to effectively combat climate change. The UAE, along with the international community, must now continue to implement its plans and increase its ambition to achieve the transformative goals necessary for a sustainable future.
— The article is co-authored by Miklos Veszpremi, Consultant, BCG
