2026 marks ten whole years since the Paris Agreement united the world in the fight against climate change: a milestone that is less about reflection and more about reckoning with what comes next. The global climate agenda is entering a decisive phase, as the world moves beyond setting targets to delivering measurable outcomes at speed and scale.
Six key climate progress markers are expected to shape the global sustainability agenda in 2026
UNFCCC 30th session of the Conference of the Parties (COP30), held from 10-21 November last year in Belém, Brazil signaled this inflection point, with stakeholders across the public and private sectors mobilising around the need to accelerate climate plans into tangible actions. Despite new Nationally Determined Contributions (NDCs), countries are still falling short of meeting the 1.5°C goal, with current policies tracking towards 2.8°C of warming.
This has set the stage for the upcoming COP31, where attention will turn toward accountability, delivery frameworks, and the credibility of updated NDC 3.0s. The stakes for 2026 could not be higher as countries race to operationalise strategies across energy systems, climate finance, adaptation and resilience, all while ensuring a just and inclusive transition. Against this backdrop, six key climate progress markers are expected to shape the global sustainability agenda in 2026.
1. New COP 30 pavilions elevate regional climate action and carbon removal solutions
COP30 marked the first-ever ASEAN Pavilion , providing the region with a dedicated platform to articulate its climate priorities, showcase regional projects and strengthen cooperation. Malaysia’s participation in the Pavilion as the ASEAN Chair in 2025 reflects growing recognition of the need for a more coordinated regional voice on climate action, particularly as Southeast Asia remains highly vulnerable to the impacts of climate change.
ASEAN used the platform to highlight progress on regional initiatives such as the ASEAN Power Grid (APG), cross-border renewable energy (RE) trading and sustainable finance frameworks. The debut Pavilion also demonstrated ASEAN’s intention to play a larger role in shaping global climate discussions, rather than simply responding to them.
Alongside ASEAN Pavilion ’s debut, Carbon Dioxide Removal (CDR) Pavilion was featured with a dedicated space for the first time in the United Nations (UN) climate negotiations. Backed by more than 90 organisations, the CDR30 Pavilion was a landmark pavilion located inside COP30’s Blue Zone , placing carbon removals at the heart of global climate diplomacy.
From Iceland’s direct air capture and mineral storage in basalt to Brazilian farmers deploying biochar and enhanced rock weathering, the pavilion highlighted a wide range of land, air, ocean, and rock-based CDR solutions. These technologies are increasingly expected to play a role in balancing residual emissions, especially in hard-to-abate sectors.
2. Modern grids and storage emerge as critical infrastructure
Amid the debate on energy transition, leaders at COP30 also discussed the significance of power grids and energy storage as central elements for global electrification. “There is no transition without transmission”, reiterated Gustavo Ataide, National Secretary for Energy Transition and Planning of host nation, Brazil.
Gustavo highlighted how Brazil operates one of the world’s largest integrated power systems with 88% renewable generation , but now faces new challenges related to grid flexibility and load integration. Outdated grids are increasingly becoming a bottleneck worldwide, slowing the deployment of solar, wind and battery storage projects.
To this end, members of the Utilities for Net Zero Alliance (UNEZA) announced plans at COP30 to raise energy transition investments to nearly USD 150 billion annually. This translates to a project pipeline worth over USD1 trillion by 2030, delivering tens of thousands of kilometers of new and upgraded grid infrastructure while tripling RE capacity.
Malaysia’s leadership in the ASEAN Power Grid (APG) continues to gain regional momentum to strengthen energy security, improve resilience, and support greater cross-border electricity trade. The Laos-Thailand-Malaysia-Singapore (LTMS) power integration project was cited at COP30 as a feasible, impactful example of multilateral power trade in the region. Following the conference, the latest LTMS-PIP agreement marked the full implementation of Phase 2, enabling an additional 100MW of electricity exports from Laos to Singapore. For utilities such as Tenaga Nasional Berhad (TNB), this reinforces the importance of building a more flexible and interconnected power system capable of supporting Malaysia’s energy transition.
3. Climate finance begins shifting towards resilience and adaptation
COP30 highlighted a growing effort to close one of the biggest gaps in global climate finance : the underfunding of climate adaptation and resilience projects. While renewable energy projects have historically attracted the majority of private capital, adaptation initiatives such as flood defenses and drought-resilient agriculture have often struggled to secure financing.
This is particularly significant for developing economies, where climate impacts are becoming more severe, and adaptation needs are rising rapidly. At COP30, leaders recognised that resilience investments should be treated just as equally important as mitigation projects in vulnerable regions including Southeast Asia.
This culminated in the adoption of the Belém Package, which includes a commitment to triple adaptation finance by 2035 . Governments, development banks and multilateral institutions called for new blended finance models, concessional financing mechanisms, and insurance solutions to support further adaptation projects.
Implementation is already in motion, with The Fostering Investible National Implementation (FINI) initiative bringing together countries, development banks, insurers and private investors to unlock USD 1 trillion in adaptation project pipelines within three years, with 20% mobilised from the private sector.
4. Countries are preparing stronger NDC 3.0 targets
COP30 served as the critical deadline for countries to submit enhanced Nationally Determined Contributions or NDC 3.0s. These updated plans reflect the logic of the Paris Agreement’s “rachet mechanism”: setting a target, measuring progress, and then raising the bar to ensure alignment with the long-term pathway to 1.5°C.
For ’s NDC 3.0, the nation reached a historic milestone by setting its first absolute emissions target to cut emissions by 15 to 30 million tonnes of carbon dioxide by 2035. This moves beyond the relative emissions intensity targets that many developing countries have typically preferred, demonstrating the nation’s climate leadership.
Energy is among the major sectors identified for emissions reductions, with projects like TNB’s Hybrid Hydro Floating Solar (HHFS) already supporting the nation’s ambition. Initiatives in other critical industries include rail-based public transport, biofuels adoption, waste recycling, and sustainable forestry management. Looking ahead, Malaysia is also incorporating nuclear energy into its future power mix strategy under the 13th Malaysia Plan (13MP) to support carbon reduction and align with global climate commitments.
Setting a target is only the beginning as nations now turn towards tracking their progress through Biennial Transparency Reports (BTRs) . This ongoing monitoring will feed directly into the next round of target setting, strengthening the evidence base for future NDCs. The question for the next cycle, both for Malaysia and the world, is whether the ratchet continues to turn.
5. Tropical forests gain a new source of climate finance
For the first time in history, Global South countries took a leading role in a forest agenda with the launch of the Tropical Forest Forever Facility (TFFF) at COP30. This major new funding mechanism is aimed at supporting tropical forest preservation for more than 70 developing countries, with 20% of funds reserved for indigenous peoples and local communities.
53 countries including 19 potential sovereign investors, the TFFF aims to generate around USD 4 billion annually to reward tropical forest countries for preserving their forests.
In total, the facility covers over 90% of the tropical forests in developing countries including Brazil, Indonesia, the Democratic Republic of Congo and China. Malaysia is one of the six tropical forest countries participating in the informal Interim Steering Committee, contributing advisory input and continuously refining the mechanism.
For Southeast Asia, which is home to some of the world’s most important tropical forests, such funding could reduce deforestation and strengthen nature-based solutions. As pressure grows to address both emissions and biodiversity loss, forest protection will continue to be an essential component of national climate strategies in 2026 and beyond.
6. Just transition becomes central to climate action
Another landmark victory for developing countries at COP30 was the consensus to develop a Just Transition Mechanism (JTM). This initiative reinforced that climate action must not only reduce emissions but also deliver fair and inclusive outcomes, ensuring that workers and communities remain protected as economies move away from fossil fuels.
During negotiations, developing countries highlighted existing structural barriers to implementing just transition efforts, stressing the importance of financial and technical support. The final decision reaffirms that just transitions are multisectoral and multidimensional, requiring holistic, whole-of-economy approaches.
This includes measures such as retraining workers, creating new green jobs, and ensuring access to affordable and reliable energy. What’s more, no prior COP decision has carried such ambitious and comprehensive language on rights and inclusion, including strong references to gender equality, women’s empowerment, youth education and more.
While COP30 has set the course for developing a Just Transition Mechanism (JTM), many practical questions remain. As Parties and observers submit their views on operationalising the JTM so that a draft decision can be adopted at COP31, 2026 will become a decisive year for determining whether the mechanism can spur real action in advancing just transition pathways.
COP31 as the next chapter for climate delivery
COP30 may be remembered less for new pledges and more for signaling the beginning of a new implementation era, one defined by delivery, accountability, and real-world impact. The true test will unfold in the lead-up to COP31 held in November 2026 at Antalya, Turkey, where countries will be expected to demonstrate tangible progress against their climate commitments.
For countries like Malaysia, the challenge now is to build the infrastructure, partnerships and financing needed to achieve ambitious targets. Utilities such as TNB will play a critical role in this next phase, helping to modernise power systems and support the nation’s effective transition to a more sustainable, resilient, and inclusive low-carbon economy.