- Nation pitches raising $1 billion from nations, companies
- Country previously weighed imposing a levy based on production

Azerbaijan, the host of this year’s United Nations climate summit, shelved a planned levy on fossil fuel production in favor of creating a voluntary fund with at least $1 billion for mitigation projects in developing countries.
The proposed Climate Finance Action Fund would raise money from voluntary contributions by oil-producing countries as well as the industry. The annual donations
It becomes operational once 10 countries pledge a combined $1 billion, with revenue from individual projects being reinvested into the fund. The donors would become shareholders and decide where to allocate the financing. Money would be used to back renewable energy projects, mitigate the ongoing impacts from climate change and help in the aftermath of natural disasters.
“We have assessed the shortcomings in financial markets,” said Yalchin Rafiyev, the COP29 chief negotiator. “This will be the first fund with both fossil fuel producing countries and companies across oil, gas and coal.”
Azerbaijan will make a contribution to the fund, but it’s unclear which other producers will sign up or what will happen if participation is lacking.
Climate finance is set to dominate the debate at COP29, which will be held in Baku in November.
Bloomberg previously reported that Azerbaijan was formulating an unprecedented levy on oil, gas and coal production with the potential to raise $6 billion a year or more. It was to be called the “North-South Financial Mechanism.”
Yet the idea faced pushback from a number of countries, including the US, the world’s largest producer of fossil fuels.
Nations agreed to transition away from fossil fuels for the first time at last year’s summit in Dubai, though Saudi Arabia has pushed back on the wording.
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