Climate Club highlights progress on decarbonising heavy industry at COP29

 At their second Leaders Meeting, the members of the Climate Club, which is also supported by the International Climate Initiative, reviewed their first year of cooperation.

Chile’s Environment Minister, Maisa Rojas, and Anna Lührmann, Minister of State at the German Federal Foreign Office, hosted the second leaders meeting of Climate Club members at COP29 in Baku, one year after the official launch in Dubai, with the support of the Organisation for Economic Co-operation and Development (OECD) and the International Energy Agency (IEA) as co-hosting institutions of the Climate Club Interim Secretariat. 

In its COP29 Statement Climate Club members underlined that the industrial sector plays a pivotal role in the global transition to a 1.5°C pathway and climate neutrality at the latest by 2050. Climate Club members agreed on seeking coordinated approaches to industrial decarbonisation, sharing the conviction that they move faster, find better solutions, and achieve more emission reductions, if they move together. Since the official launch of the Climate Club, members developed a joint understanding around spillover effects of climate policies, which occur due to different speeds in the transition and a variety of policy designs. They acknowledge that a possible relocation of industrial production to countries with lower production costs, known as carbon leakage, can undermine investments in decarbonisation and agreed to explore options for coordinated policy approaches to address risks of carbon leakage.

Definitions for low-emission steel and cement 

The Climate Club is also committed to scaling up lead markets for near-zero emission materials this decade, aiming to make decarbonised industrial production the default by 2030. In their Statement, Climate Club members jointly recognised the emerging convergence on how to define near-zero steel and cement, and affirmed the IEA principles for near-zero and low-emission steel and cement, emphasizing that definitions should be ambitious, transparent, and globally consistent. Consistent definitions eliminate ambiguity in climate commitments and make their adoption easier for governments and industry. Such clarity supports coherent global markets, discourages greenwashing, and ensures that emissions reductions are genuine and measurable.

Mobilising investments in green industries

The Climate Club strives for a transition, which is truly inclusive. Mobilising investments in green industries is of key importance to accelerate emission reductions worldwide. As a key instrument of the Climate Club, the Global Matchmaking Platform (GMP) will be fully operational from COP29. The GMP, open to all emerging markets and developing economies, is a support mechanism of the Climate Club, which coordinates and matches requests for support with international technical and financial assistance. The United Nations Industrial Development Organization (UNIDO) hosts the Secretariat. Several countries have already expressed interest in the Platform, with some initial pilot projects being explored by Chile, Colombia, Indonesia, Kenya and Morocco, among others. 

Since early December 2023, the International Climate Initiative (IKI) has financed the Secretariat for the Climate Club’s Global Matchmaking Platform, beyond other things. The Secretariat coordinates the international portfolio of technical and financial support services for transitioning and developing countries with the aim of accelerating industrial decarbonisation.

In this context, the IKI also supports UNIDO’s ‘Partnership for Net Zero Industry’ programme, which is helping developing and emerging countries in developing national transformation pathways and standards, and identifying technology options and preparing pipelines for investment-ready projects.

Read the full version of the Climate Club´s press release

Background information on the Climate Club initiative for global decarbonisation

In 2022, Chancellor Olaf Scholz used the occasion of the German G7 Presidency as an opportunity to form the open and cooperative Climate Club, with the aim of supporting the rapid and ambitious implementation of the Paris Agreement and accelerating climate change measures for emissions mitigation. As an inclusive forum of ambitious developed, transitioning and developing countries, the Climate Club is helping to speed up the decarbonisation of especially emissions-intensive industrial sectors. Now numbering 43 member states, the Climate Club also offers countries an opportunity to raise domestic issues at a high-ranking policymaking level, which can then be addressed by the IKI.

How the International Climate Initiative is involved

The Climate Club is based on three pillars:
•    Advancing ambitious and transparent climate change mitigation policies
•    Transforming industries
•    Boosting international climate cooperation and partnerships

The aspects addressed by the third pillar, namely to encourage and facilitate climate action and improve the enabling environment for industrial decarbonisation in developing and emerging countries, form the central field of work for the IKI. 

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