What You Need to Know.

  • Azerbaijan is poised to host COP29 next year after receiving regional backing.  If formally confirmed, Azerbaijan’s COP Presidency would resolve months of deadlock.  It will also trigger criticism that next year’s COP will again be hosted by a nation heavily dependent on fossil fuel exports.
  • Brazil has been formally chosen to host COP30 in 2025.  The venue will be the city of Belém, located in the Amazon rainforest.  As Brazil’s Minister of the Environment and Climate Change, Marina Silva, commented: “With its immense biodiversity and vast territory threatened by climate change, the Amazon will show us the way.”
  • The UNFCCC has released a revised draft text of the negotiated outcome of the first Global Stocktake under the Paris Agreement.  The revised draft no longer mentions the “phase out” of fossil fuels and instead mentions the “substitution of unabated fossil fuels” and “tripling renewable energy capacity . . . by 2030.”
  • The inclusion of “phase out” language in the final agreement has been one of the yardsticks by which commentators have suggested the success or failure of COP28 should be measured.  Accordingly, the new draft was met by significant criticism, including by the European Union’s representatives who called elements of the text “unacceptable.”  Negotiations now center on finding a compromise, almost guaranteeing that discussions at COP28 will continue beyond the official close of the conference on Tuesday, December 12.
  • Following the official theme of the day, 154 nations signed the COP28 UAE Declaration on Sustainable Agriculture, Resilient Food Systems, and Climate Action.  The Declaration commits to “expedite the integration of agriculture and food systems into our climate action” and to “scaling-up adaptation and resilience activities and responses in order to reduce the vulnerability of all farmers, fisherfolk, and other food producers to the impacts of climate change.”  The contributions of the agriculture and forestry sectors, both as a source of emissions and as carbon sinks, are continuing to gain attention as an important part of the global efforts on climate change.

Why This Matters for Businesses.

  • The dropping of the “phase out” language from the current draft of the Global Stocktake is a sign of the deep contention around the future of hydrocarbons in energy systems.  Business should keep a close watch on how this debate progresses.
  • Of note, the current draft agreement includes a series of more specific comments on technologies such as “zero and low carbon fuels,” “low carbon hydrogen production,” and “rapid deployment of zero and low emission vehicles.”  Businesses will want to pay close attention to the language on such different technologies as a bellwether of future policy trends and the emphasis and support pro-climate technologies will receive in the years to come.
  • For businesses, the Declaration on Sustainable Agriculture, Resilient Food Systems, and Climate Action underlines the growing attention this crucial sector is receiving from policy makers and regulators.  It will be important to monitor how these goals translate into specific policies in contexts like the European Commission’s Carbon Farming initiative, and the CFTC’s emphasis on more robust rules for voluntary carbon market transactions, including those reliant on the forestry sector.

Covington Commentary.

“The emphasis on public and private funding at COP28 shows that while national-level disagreement remains on climate-mitigation policy, the operationalization of the world’s decarbonization efforts is under way.  As we look to COP29 and COP30, there will be significant opportunities for companies that can find the right mix of subsidies, climate finance, and technological innovation to harness this energy and drive global climate action forward.” 

—Bradford McGann, Associate, Carbon Management and Climate Mitigation Industry Group

More News and Developments.

Covington’s multidisciplinary COP28 delegation includes leaders of Covington’s ESG, Environment, Energy, Project Development and Finance, Corporate, and Public Policy practices, as well as our unique Carbon Management and Climate Mitigation (CM2) initiative. Our comprehensive and integrated global team is ready to assist clients as they prepare for COP28, engage with key stakeholders while there, and then strategize about and successfully implement ESG corporate policies aligned with COP28 goals.  Follow our Climate Hub for Businesses to stay up to date with the latest developments from COP28.

Tags: Azerbaijan, Brazil, COP29, Phase Out Debate
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Photo of Paul Mertenskötter Paul Mertenskötter

Paul Mertenskötter advises companies, investors, and governments on regulatory environmental, social, and governance (ESG), international trade, and public policy matters.

He has particular experience advising clients on the European Union’s Green Deal, including the Corporate Sustainability Reporting Directive (CSRD), Corporate Sustainability Due Diligence…

Paul Mertenskötter advises companies, investors, and governments on regulatory environmental, social, and governance (ESG), international trade, and public policy matters.

He has particular experience advising clients on the European Union’s Green Deal, including the Corporate Sustainability Reporting Directive (CSRD), Corporate Sustainability Due Diligence Directive (CS3D), EU Forced Labor Products Ban, and Carbon Border Adjustment Mechanism (CBAM). He also advises clients on the rules of the World Trade Organization (WTO), free trade agreements, the Paris Agreement, and general public international law.

Prior to joining the firm, Paul was a Visiting Scholar at the WTO in Geneva, clerked at the International Court of Justice in The Hague, and was a Fellow at the Institute for International Law and Justice at NYU Law School.

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Photo of Carol Browner Carol Browner

Carol M. Browner brings nearly four decades of experience advising on environmental and energy policies affecting global energy, environmental, public health, and business matters.

She provides counsel to industry leaders in the energy, transportation, and consumer product sectors on regulatory matters, environmental impact…

Carol M. Browner brings nearly four decades of experience advising on environmental and energy policies affecting global energy, environmental, public health, and business matters.

She provides counsel to industry leaders in the energy, transportation, and consumer product sectors on regulatory matters, environmental impact issues, corporate sustainability approaches, and strategic partnership development to advance clean energy, ESG, and other business priorities.

Carol joins the firm after serving as Senior Counselor in the Sustainability practice of the Albright Stonebridge Group, a global strategy firm.

Carol served as Assistant to President Barack Obama and Director of the White House Office of Energy and Climate Change Policy, where she oversaw the coordination of environmental, energy, climate, transport, and related policy across the U.S. federal government. During her tenure, the White House secured the largest investment ever in clean energy and established the national car policy that included both new automobile fuel efficiency standards and first ever greenhouse gas reduction standards.

Carol is the longest serving Administrator of the Environmental Protection Agency. As Administrator, she adopted the most stringent air pollution standards in U.S. history; set the first fine particle clean air standard; and spearheaded the reauthorization of the Safe Drinking Water Act as well as the Food Quality Protection Act. Carol was known for working with both environmentalists and industry to set science-based public health protections while providing businesses important flexibilities in how to meet those standards. She worked across the agency to ensure a focus on protecting vulnerable populations and promote environmental equity.

Additionally, Carol serves on a number of boards of directors advising on environmental and energy issues, including as Chair of the Board of the League of Conservation Voters, as Chair of the Sustainability Committee of the Board of Directors for Bunge Limited, and as a Board Member of Innovyze.

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Photo of Thomas Reilly Thomas Reilly

Ambassador Thomas Reilly, Covington’s Head of UK Public Policy and a key member of the firm’s Global Problem Solving Group, draws on over 20 years of diplomatic and commercial roles to advise clients on their strategic business objectives.

Ambassador Reilly was most recently…

Ambassador Thomas Reilly, Covington’s Head of UK Public Policy and a key member of the firm’s Global Problem Solving Group, draws on over 20 years of diplomatic and commercial roles to advise clients on their strategic business objectives.

Ambassador Reilly was most recently British Ambassador to Morocco between 2017 and 2020, and prior to this, the Senior Advisor on International Government Relations & Regulatory Affairs and Head of Government Relations at Royal Dutch Shell between 2012 and 2017. His former roles with the Foreign and Commonwealth Office included British Ambassador Morocco & Mauritania (2017-2018), Deputy Head of Mission at the British Embassy in Egypt (2010-2012), Deputy Head of the Climate Change & Energy Department (2007-2009), and Deputy Head of the Counter Terrorism Department (2005-2007). He has lived or worked in a number of countries including Jordan, Kuwait, Yemen, Libya, Iraq, Saudi Arabia, Bahrain, and Argentina.

At Covington, Ambassador Reilly works closely with our global team of lawyers and investigators as well as over 100 former diplomats and senior government officials, with significant depth of experience in dealing with the types of complex problems that involve both legal and governmental institutions.

Ambassador Reilly started his career as a solicitor specialising in EU and commercial law but no longer practices as a solicitor.

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