From electrification to climate finance, how will COP31 move the needle on climate action?

SINGAPORE – Nearly 200 countries will gather at Antalya in Turkey from Nov 9 to 20 for the UN climate change conference COP31, where they will discuss how the world can tackle climate change.

This year’s conference comes more than 10 years after the Paris Agreement was first adopted.

The global pact has three main targets: to limit global warming by reducing emissions, to ensure communities are protected from climate impacts, and to ensure developing countries get financial help from developed countries for low-emission, climate-resilient development.

Multiple observers have billed COP31 as an “implementation COP”.

This is a reference to how the conference is expected to provide guidance and solutions that help countries put in place policies and initiatives to tackle climate change, instead of just setting targets or making political statements.

Melissa Low, a research fellow studying global climate policy at the NUS Centre for Nature-based Climate Solutions, said: “An implementation COP should be judged less by the number of new pledges announced and more by whether existing commitments are translated into policies, investment, projects and measurable emissions reductions and resilience outcomes.”

This year’s conference will also take place against a backdrop of an escalating energy crisis due to the US-Israel war on Iran, and a spate of climate-fuelled disasters. These include the glacial floods in Nepal and Indonesian forest fires.

Ahead of the annual UN climate change conference COP31, The Straits Times highlights the key issues, their challenges and their significance for South-east Asia.

Climate finance

What it is: Climate finance refers to the flow of funds from developed countries to developing countries. These contributions can help developing nations achieve the goals of the Paris Agreement.

For example, financial contributions can help poorer nations shift away from fossil fuel energy sources towards cleaner options, such as renewable energy.

Funding can also help countries make their factories more efficient, or allow them to protect their forests.

Climate finance can also help developing countries do more on climate adaptation, like building sea walls to keep out the rising seas, or investing in early warning systems.

Earlier COPs have already set targets for climate finance.

For instance, at COP29 in Azerbaijan in 2024, developed countries agreed to provide US$300 billion (S$384 billion) a year in annual climate finance to developing countries – an increase from the previous US$100 billion target. The ultimate aim is to raise US$1.3 trillion annually by 2035 for countries in need, through various forms of finance.

At COP30 in Brazil in 2025, countries called for efforts to at least triple adaptation finance by 2035.

At COP31, the question will be how developed countries will meet these targets.

Areas of disagreement: Climate finance is one of the thorniest issues at every climate conference. Discussions usually centre around who pays, who receives, and through what mechanisms and vehicles.

For instance, developing countries have said that funding support should take the form of concessionary and non-debt creating instruments, such as grants, to prevent them from having to service loans at market interest rates.

Questions also remain over the flow of the funds as there is no specified timeline for disbursements.

At COP31, experts say they expect developing countries will want more predictable support to cope with climate impacts.

Poorer nations would also likely say that adaptation finance should not come from reducing mitigation finance.

This is because the costs of adapting to the changing climate will keep going up if emissions also keep rising.

Tan-Soo Jie-Sheng, director of the Institute for Environment and Sustainability at the Lee Kuan Yew School of Public Policy (LKYSPP) said sufficiently large and distinct financing streams are needed for both climate mitigation and adaptation.

“The more warming we fail to prevent, the greater the amount of adaptation we need, the more expensive that adaptation becomes, and eventually, there will be impacts to which adaptation is extremely difficult or impossible.”

Yet, developed countries that are also feeling the pinch from higher energy costs, may be reluctant to make firm commitments, said sustainability consultancy firm Asia Research and Engagement’s director of research Chan Wai-Shin.

Why it matters for South-east Asia: The region is highly vulnerable to climate change. It faces a medley of hazards like rising sea levels, unbearable heat and extreme weather events intensified by climate change.

Winston Chow, professor of Urban Climate at Singapore Management University, said: “We are already witnessing ourselves and our neighbours coming face to face with the impacts of climate change be it rain-driven floods in Bangkok, glacial-related floods in Nepal that affected many of us in South-east Asia, or with the wildfires driving the transboundary haze.”

At the same time, the region is developing fast and is a growing emitter of greenhouse gases.

Climate finance is crucial as it provides South-east Asian economies with the means to transition to lower-carbon options, as well as adapt to a warming region.

Moreover, some countries in the region have pledged to cut more emissions only if they receive more support in the form of finance and technology, said Melinda Martinus, a fellow at ISEAS – Yusof Ishak Institute.

For instance, the Philippines had committed to reducing its emissions by 75% between 2025 and 2035.

However, achieving this will depend on the country receiving international support. Without it, the country will only commit to achieving an up to 7% reduction in emissions.

“This means that achieving more ambitious emissions reductions depends, at least in part, on access to international finance, technology and capacity-building,” she said.

Loss and damage

What it is: Loss and damage is a specific climate finance mechanism.

It refers to the funds paid out to developing countries to compensate them for the unavoidable climate impacts that they face due to the pollution from developed countries.

Such losses and damage include the loss of lives, infrastructure and even cultural heritage.

The money pot from the loss and damage mechanism can be used to repair devastated properties affected by climate-linked disasters or relocate people threatened by rising seas.

It can also be channelled for long-term use, such as building early warning systems or resilient infrastructure to help reduce fatalities from extreme weather events.

It is one of the more controversial areas of the climate negotiations.

Negotiations on this front took decades. It was first introduced in 2007, but countries only agreed at COP27 in 2022 to create a dedicated fund for loss and damage.

Areas of disagreement: Since the UN’s Fund for Responding to Loss and Damage was created, 27 countries have pledged to contribute a total of US$822 million to it, as at March 2026.

But only about half was received by the end of Dec 2025, according to the World Bank Group, which is the fund’s financial custodian.

As at July 2026, 176 requests have been made by 119 countries for about US$2.8 billion – more than three times the amount pledged.

No funds have been paid out to date.

On Oct 22, the fund’s board said it has set aside US$21.6 million for Nepal following the Aug 26 glacial floods. That disaster claimed about 1,500 lives, affected at least 80,000 people, and destroyed homes, schools and infrastructure like hydropower facilities.

To receive the funds, Nepal must formally apply and submit a proposal to the fund.

Asia Research and Engagement’s Chan said that developing countries are likely to want to discuss the gap between pledged and delivered finance at COP31.

Access to the fund and eligibility criteria will also remain in focus.

The speed of funds being disbursed is particularly contentious – especially when disaster-hit countries urgently need support to rebuild communities, infrastructure and livelihoods.

Why it matters for South-east Asia: The region is prone to climate disasters, but some governments are fiscally strained and need more immediate resources to help in the recovery.

Tan-Soo from the LKYSPP said countries like the Philippines, Vietnam and Indonesia face substantial economic losses from climate-driven disasters.

For example, in 2025, the tropical cyclone damage for the Philippines was 42.21 billion pesos (S$845 million), according to the country’s Development Budget Coordination Committee.

Heavy rain in September also triggered flooding and landslides in northern and central Vietnam, inundating more than 16,000 homes and damaging 22,499ha – equivalent to about 31,500 football fields – of rice, vegetables and other crops.

While considered a type of climate finance, the loss and damage fund is distinct from adaptation finance.

“Adaptation helps countries prepare for and reduce future climate risks. But even with substantial adaptation investments, some losses are unavoidable,” said Tan-Soo. “The Loss and Damage Fund addresses these remaining consequences.”

A just transition

What it is: How to enable a “just transition” is likely to be one of the key issues that will be discussed at COP31.

This issue centres around people – specifically, how to ensure that the move towards a low-carbon economy will not disadvantage workers in the fossil fuel sectors, indigenous groups, and lower-income members of the community.

For example, when coal plants are shut down or forests receive more protection, workers in the factories or logging sector could lose their jobs.

Opting for cleaner energy sources in some areas could cause electricity bills to rise in the near term because of the need for new infrastructure, and this would affect lower income groups.

A just transition refers to efforts put in place to ensure these communities are not disadvantaged – through retraining programmes or governmental efforts to keep electricity prices stable, for instance.

A just transition is particularly important for developing countries, as it helps them manage the economic and social changes brought about by decarbonisation efforts.

The negotiations for this are co-chaired by Singapore’s chief negotiator for climate change Joseph Teo and Italy’s Federica Fricano.

Areas of disagreement: At COP31, countries will discuss how a just transition can be enabled. Developing countries and civil society groups will likely call for a new fund, which they can tap to design inclusive policies, train workers, and so on.

But developed countries may push back on this, saying there are many other mechanisms within the Paris Agreement that already provide funding for developing nations.

Wealthy countries favour sharing policy tools and technical expertise rather than establishing a new institution, said Climate Action Network International’s senior advisor on just transition Anabella Rosemberg.

World Resources Institute’s (WRI) director for international climate initiative David Waskow said there are many just transition initiatives under way, but they are fractured and not well-connected enough.

Currently, there are initiatives including the Just Energy Transition Partnerships in Indonesia and Vietnam, which aim to unlock financing to accelerate phasing out coal, although implementation remains challenging.

The Asian Development Bank in 2021 also launched the Energy Transition Mechanism that aims to accelerate the transition from fossil fuels to clean energy by retiring or repurposing coal-fired power plants in countries like the Philippines.

Why it matters for South-east Asia: The region has one of the world’s youngest fleets of coal plants.

An accelerated phase-out of coal could, therefore, result in stranded assets, which would mean financial losses for the operator, said ISEAS – Yusof Ishak Institute’s Martinus.

As mining and processing coal also provide hundreds of thousands of jobs, the transition away from coal could have significant implications for workers and communities that depend on the industry, she said.

Financial instruments such as concessional financing, grants and blended finance can help bridge the cost gap between continued coal operations and a transition to cleaner energy sources.

This is where new financial mechanisms, like transition credits, can help to provide an economic incentive for decarbonisation.

Singapore, for instance, is piloting a new class of carbon credits called transition credits, that aims to use revenue from the sale of carbon credits to close a coal plant early.

When a coal plant is closed early, some planet-warming emissions are prevented from being released. These “savings” can be sold as carbon credits to emitters.

Unless transition credits are factored in, it makes little financial sense to shut these coal plants ahead of time.

The expansion of renewable energy has also come at a cost to some communities in the region.

For example, in Malaysia, communities in Sarawak and Perak were affected by hydropower projects that have displaced them from their ancestral lands and disrupted their traditional livelihoods.

Such issues may be more rampant as renewable energy capacity in the region expands. South-east Asia’s renewable capacity stood at 120GW in 2024, and is projected to nearly triple by 2035 under today’s policy settings, according to the International Energy Agency.

Energy and electrification

What it is: The ongoing energy crisis due to the war in Iran has sparked a global reckoning over the world’s reliance on fossil fuels.

The Turkish presidency of COP31 has set an electrification target for countries to agree on at the conference.

The goal aims to increase the share of electricity in global energy demand from 20% currently to 35% by 2035 through electrification.

Electrification can help to reduce carbon emissions, when processes relying on fossil fuels are tweaked so they can rely on electricity generated from low-carbon sources instead.

For instance, switching from internal combustion engine vehicles to electric cars can reduce consumption of petroleum.

The Strait of Hormuz crisis, which has led to volatile fuel prices, could also strengthen the case for the transition away from fossil fuels for energy security, said Martinus.

Areas of disagreement: Electricity requires large, expensive infrastructure to generate, transport and distribute, according to IEA.

Some electrification investments may also require policy support to lower upfront costs or facilitate access to affordable capital, it said.

Martinus added that the transition will also need investments into supporting infrastructure such as the electricity grid and storage.

The Strait of Hormuz crisis could also lead to countries falling back on more affordable energy sources, which may not be clean, said Tan-Soo.

For example, some countries, such as Thailand and Vietnam, have pivoted to coal as a fallback.

But the long-term lesson from the crisis points in the opposite direction, he added.

“A geopolitical crisis thousands of kilometres away can suddenly impose enormous costs on countries that depend heavily on internationally traded fossil fuels,” he said.

“That strengthens the energy-security case for renewables, electrification, and energy efficiency.”

For example, he cited how Thailand is using the energy crisis to spur its development of clean power generation and reduce reliance on imported fuels to diversify its fuel mix for the long term, such as accelerating its floating solar projects at its dams and upgrading its transmission system to support renewable energy.

Why it matters for South-east Asia: Energy demand in the region is growing rapidly, with the ASEAN Centre for Energy estimating that energy demand in the region could more than double by 2050.

But fossil fuels, especially coal, dominate the region’s energy mix, according to IEA.

The region’s heavy reliance on Middle Eastern oil and gas left it vulnerable during the Strait of Hormuz crisis, as volatile fuel prices disrupted economies and strained energy systems.

But discussions over the ASEAN power grid have ramped up in recent years, and the electrification agenda could help to accelerate this process to overcome obstacles to its implementation, especially if new funding comes online.

“The ASEAN Power Grid therefore fits naturally into the ‘implementation COP’ story, since the region is moving towards greater cross-border interconnection, grid infrastructure enhancements… among others,” said Low, the NUS research fellow.

“This is where international climate cooperation can help,” said Tan-Soo, citing how ASEAN, the Asian Development Bank and the World Bank have already established the APG Financing Initiative which can provide concessional finance, guarantees and other instruments to de-risk projects and crowd in private capital.

“COP31 can reinforce these efforts by mobilising additional climate finance and making regional grid infrastructure a more prominent part of the energy-transition agenda,” he added.