Five things to watch at COP30

At the outset of the United Nations in 1945, US President Harry Truman acknowledged a global challenge ahead. “We all have to recognize – no matter how great our strength – that we must deny ourselves the license to do always as we please.” Truman was referring to prioritising problem-solving for the good of the world over national interests. And making climate change a priority for all countries will remain a challenge at the latest iteration of the United Nations Framework Convention on Climate Change, COP30.

Progress on lowering global carbon emissions is stubbornly slow. In our latest Energy Transition Outlook, the world is on a 2.6 °C emissions pathway, with the 1.5 °C pathway increasingly out of reach. Energy security and affordability, rather than climate, have risen to the top of the agenda for many countries around the world. Meanwhile, gas-fired power investment, primarily in the US, is surging, driven by AI.

New nationally determined contributions (NDCs) that are due at COP30 lack the ambition to meet the Paris climate accord goals. Protestors who tested COP30’s security earlier this week illustrate the challenge of managing multiple stakeholders, each with specific priorities.

With these issues on the table, COP30 has been billed as ‘the implementation COP’. This means it will develop existing climate policies, rather than announce a range of new goals. As COP30 faces the reality of changing the global energy sector, five areas are worth watching:

1. Carbon markets. COP30 will refine carbon pricing, trading and nature-based offsets regulations to support investment in low-carbon supply or abatement solutions.
2. China’s pledges. China will likely outperform its latest climate pledge to expand wind and solar capacity sixfold by 2035. Rather than its NDC, watch how fast China expands its low-carbon supply chain.
3. US policy. With the US out of the Paris Agreement for the second time, state-level policies, load growth and corporate policies will be the primary drivers of low-carbon investment in America.
4. Expanding biofuels. The Belém Commitment for Sustainable Fuels, known as Belém 4x, intends to quadruple the production and use of sustainable fuels, including hydrogen and its derivatives, biogases, biofuels and synthetic fuels, by 2035.
5. CBAM compliance. As Europe begins to scale its Carbon Border Adjustment Mechanism (CBAM), developing countries will likely seek longer phase-in periods and industry carve-outs to comply with carbon taxes over time.

For COP30, the absence of the US is the elephant in the room. As the world’s largest economy, second-largest carbon emitter and the largest oil and gas producer in the world, the US can influence the pace of low-carbon investment globally. Describing the Paris Agreement as an “unfair, one-sided rip-off”, President Donald Trump withdrew the US from it on his first day in office in 2025.

The US has an on-again, off-again relationship with global climate governance. President Bill Clinton signed the Kyoto Protocol in 1998, but the US Senate feared the Kyoto Protocol could “result in serious harm to the economy of the United States”, stopping Congressional ratification in its tracks. President George W. Bush withdrew the US from the Kyoto Protocol in 2001. Since 2015, the US has joined and exited the Paris Agreement twice.

Given the track record of US participation in global climate initiatives, what can we expect from the US at COP30?

The Wood Mackenzie view

Although the US is out of the Paris Agreement, it is still influencing global policy on climate change. For example, strong resistance from the US administration caused the International Maritime Organization to delay a vote on whether to adopt its Net Zero Framework. But while the US is out of the climate agreement now, it is not out of decarbonisation altogether. Far from it.

After the US election of President Trump in 2024, ExxonMobil urged the Trump administration to stay in the Paris Agreement to influence global carbon policy and international regulations that could impact US companies. According to a study from the UCLA Anderson School of Management, 57% of the S&P 500 companies have net zero and carbon neutrality goals. Leading hyperscalers have invested in zero carbon power technologies such as advanced nuclear power in 2025.

What is also clear is that the US power market will need renewables going forward. According to Patrick Huang, Senior Analyst, US power, “Our Lens Power platform shows that the combination of 2% to 3% per year demand growth, coal retirements and limits to natural gas-fired power means the US power grid requires several hundred gigawatts of new solar and wind capacity through 2035.”

Huang concludes: “Renewable power is still the lowest-cost option to meet power demand.”

At COP30, the leading voice for renewable power will be the US Climate Alliance, chaired by California Governor Gavin Newsom. The group’s 24 governors represent 57% of US GDP and 54% of its population, according to the group. The states within the alliance outpaced the national average in net emissions reductions by 8% between 2005 and 2023, according to its figures.

State-level policy remains critical to low-carbon investment in the transport sector. According to the California Air Resource Board, the state’s clean fuels standard supported US$4 billion in new investments in low- or zero-emissions transport technologies such as biodiesel, biogasoline and electric vehicles. Low-carbon fuel standards have expanded across the western US to include Washington, Oregon and New Mexico.

Federal government policy will no doubt change as a result of future presidential elections, but state-level autonomy remains a bedrock of the US energy sector. According to Lindsey Entwistle, coauthor of Wood Mackenzie’s Energy Transition Outlook, in our base case outlook between 2025 and 2060, US emissions fall by 60%. In our delayed transition scenario, which posits a slower investment pathway for low-carbon supply, emissions fall by 43% over the same time period.  

In brief 

‘The Art of the Deal’ for strategic sectors

In early November, Vulcan Elements and ReElement Technologies announced a US$1.4 billion private-public partnership with the US government and private investors. The partnership aims to build a new 10,000-metric tonne magnet production facility.

ReElement’s technology will recycle and refine rare-earth oxides, which Vulcan will then convert into completed high-performance magnets. While this announcement will not end China’s dominance in global rare earths production and supply, it is a step towards establishing a US-led supply chain.

This announcement reflects how the Trump administration approaches strategic sectors: moving beyond policy support, such as tax incentives, to partnering with specific companies via equity investing, profit sharing and loans. Key examples include the administration’s 10% equity stake in Intel, a 15% profit share of Nvidia chip sales to China and the potential for equity with Brookfield’s $80 billion investment announcement in US nuclear.

Tariffs are still likely despite Supreme Court review 

The US Supreme Court is reviewing President Trump’s authority to impose trade tariffs, a major challenge to the president.

The Trump administration argues that the 1977 International Emergency Economic Powers Act (IEEPA) empowers the executive branch to impose tariffs. The counterargument is that the US Constitution says tariffs are Congress’ domain unless it delegates the specific authority on tariffs to the president. According to initial reports, justices questioned the administration's argument that IEEPA's ambiguous power to “regulate” imports includes the authority to levy tariffs.

Regardless of what happens at the Supreme Court, the Trump administration has laid the groundwork for more Section 232 and 301 tariffs in the future. So far this year, the Trump administration has opened investigations that could lead to new or expanded tariffs for critical minerals, polysilicon, wind turbines and semiconductors.

Houston’s Power and Trading Conference

Wood Mackenzie presented our short-term power market analysis this week to break down how large loads are reshaping gas and power markets in the US. Rebekah Llamas, Principal Analyst, noted the scale of large loads, highlighting, for instance, Lake Mariner, a data centre in New York, which represents approximately 9% of NYISO Zone A demand.

One crucial question for power markets is how price-responsive large loads are. There is clear price-responsive behavior above US$100/MWh thresholds, with facilities reducing consumption during high-price periods and backfilling from onsite generation or storage resources. Looking at Tesla’s gigafactory in Texas, we are seeing a spike in electricity consumption ahead of congestion-driven price rises, according to Wood Mackenzie’s short-term power analysis.

Concentrated demand creates significant basis risk that must be actively managed. RTOs across the country will need to revise and update short-term load-planning methodologies to inform long-term investments. “Real-time visibility tools provide trading advantages for those who can detect unforecasted load ramps,” according to Llamas.

Wildcard of the week

Introducing a new occasional section in the Energy Pulse: the wildcard of the week. This is intended to identify a specific trend, announcement or investment that could impact the US energy sector in unanticipated ways. As we wrote about in last week’s Energy Pulse, a proposed rulemaking from the Department of Energy (DOE) could accelerate large load interconnections to the US grid.

The wildcard here will be the reaction from the power sector. According to Ben Hertz-Shargel, Director Grid Edge, greater Federal Energy Regulatory Commission (FERC) jurisdiction would be fought tooth and nail by states and utilities in the stakeholder process and then the courts. Further, the utility industry is likely to support FERC’s existing authorities over a federal takeover. Nevertheless, the real opportunity is for FERC and the states to take up the DOE's recommendations within existing jurisdictional limits.

If events go that way, we could see acceleration of large load co-location with generation and a host of new partnerships. Look out for industry comments to the DOE rulemaking from 21 November.  

Other views

From export setbacks to domestic surge: India’s solar pivot amid global trade shifts - Harshul Kanwar

Macro Oils 10-year investment horizon outlook 2025 – Douglas Thyne

SMR nuclear market update: Q3 2025 – Zoe Sulmont

Quote of the week

“We have significant lending authority at the loan program office… by far the biggest use of those dollars will be for nuclear power plants – to get those first plants built.” US Department of Energy (DOE) Secretary Chris Wright at the American Nuclear Society Conference on 10 November.

On the heels of the US$80 billion investment announcement in nuclear power last week, Secretary Wright highlighted the key role that the loan program office (LPO) will have in supporting new nuclear power investments – the DOE can redirect spending in line with the executive branch’s priorities. Nuclear power could receive a larger share of DOE grants or loans as the Trump administration shapes the LPO. The Inflation Reduction Act and Infrastructure Investment and Jobs Act appropriated around US$400 billion to the LPO, according to external sources.

Chart of the week

From our latest quarterly outlook on the global geothermal sector. Our geothermal team believes the sector is shifting its focus from expansion to execution as policy support, technological innovation and surging data centre demand converge. Data centre growth is emerging as a critical driver for US power where baseload power requirements are accelerating partnerships between technology companies and geothermal developers.

This chart shows that announced capacity growth in 2025 has been driven by data centre demand and breaks down the key companies that are leading in the geothermal sector in North America.

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