BRUSSELS — Azerbaijan, host of this year’s U.N. COP29 climate summit, has scrapped plans to propose a levy on fossil-fuel producers to raise climate-change funding, and instead aims to launch a new fund at the summit for green investments in poorer countries, a senior COP29 source said.
Speaking on condition of anonymity, the source said Azerbaijan had initially conceived the idea of a levy on fossil-fuel production to raise funds for tackling climate change, but that this had faced resistance from some countries.
“We had several rounds of engagements with the parties concerned – with the other potential contributors – and we needed to adjust the fund idea to make it also attractive for potential contributors,” the source said.
“Azerbaijan will be one of the main contributors of this fund,” they said, adding that the fund would also seek voluntary contributions from other fossil fuel-producing countries.
Other sources familiar with the discussions told Reuters oil and gas-producing Gulf countries had opposed the initial idea of a levy.
The revised proposal would aim to establish the fund during the COP29 summit in November, and use public-private partnerships to de-risk investments to help developing countries cut emissions and cope with worsening climate change, the COP29 source said.
Poorer nations are struggling to attract investments in clean energy because of issues including high interest rates and domestic debt burdens. Africa has received just 2% of global investments in renewable energy over the last two decades, according to the International Renewable Energy Agency.
The issue of finance is set to dominate the COP29 climate talks in Baku in November, where countries will try to agree a new global target for climate finance that rich nations will transfer to poorer countries each year from 2025.
(Reporting by Kate Abnett in Brussels; Editing by Matthew Lewis)
