U.S. Submits Withdrawal from the Paris Agreement: Potential Implications?

The Withdrawal

The United States’ Acting Ambassador to the United Nations (U.N.) submitted a notification of withdrawal from the Paris Agreement on January 27, 2025, which is set to become effective one year after notification on January 27, 2026.¹ Rather than withdrawing from “any agreement, pact, accord, or similar commitment” made under the United Nations Framework Convention on Climate Change (UNFCCC),² as announced in an Executive Order on January 20, the withdrawal is limited to the Paris Agreement. Nevertheless, during this process, the U.S. may choose to refrain from meaningful participation in all UNFCCC-related multilateral forums.³

Immediate Effects

After January 2026, the U.S. will no longer be a party to Paris Agreement obligations such as submitting Nationally Determined Contributions (NDCs) every five years, tracking progress through biennial transparency reports and generally providing some level of climate finance.⁴ In return, the U.S. will forfeit its vote in Paris proceedings, its right to nominate members to run institutions serving the Paris Agreement and to participate in the Agreement’s emissions trading scheme. As a result, pledges and initiatives led by the U.S. in pursuit of Paris Agreement goals face an uncertain future. The Global Methane Pledge (GMP), for example, was announced at COP 26 in 2021 by the U.S. and the European Union (EU). It sets a voluntary target to reduce methane emissions by 30% by 2030 and promises financial and technical assistance for methane abatement policies and projects. The GMP has made significant advancements in recent Conferences of the Parties (COP) by ratcheting up grant funding, policy ambition and private sector commitments, for example, via the Oil and Gas Decarbonization Charter (OGDC) at COP 28,⁵ and the Declaration on Reducing Methane from Organic Waste at COP 29.⁶ However, the U.S. withdrawal signals reduced funding for the initiative; this may have a chilling and cascading effect as the other countries, as well as the private sector, weigh whether to honor or enhance their commitments.

Domestic and International Implications

Domestically, the withdrawal signals that the federal government will no longer pursue the voluntary policy measures needed to meet stated targets outlined in its NDC. In other words, the withdrawal from Paris signals U.S. intent to unwind hallmark Biden-era mitigation policies such as technology-neutral tax credits for zero-emissions electricity production, federal regulations to require power companies to control pollution from coal and new gas-fired power plants and methane leakage from oil & gas production, and federal standards to limit greenhouse gas (GHG) emissions and boost fuel economy paired with public investments to electrify transportation.⁷ 

Internationally, the withdrawal retracts U.S. climate finance pledges, condones further departures from the Agreement and creates a vacuum for other actors to have an outsized voice in negotiations. By way of climate finance, the New Collective Quantified Goal (NCQG) on climate finance reached at COP 29 sets a target of $300 billion per year by 2035, with an additional layer of up to $1.3 trillion from “crowded-in” non-public sources of capital. In 2024, the U.S. provided approximately $11 billion of climate finance from various institutions including the U.S. International Development Finance Corporation (DFC), Export-Import Bank (EXIM) and the Agency for International Development (USAID).⁸ However, President Trump’s Executive Order also instructs the Ambassador to the U.N. to, in collaboration with the Secretary of State and the Treasury, “cease or revoke any purported financial commitment made by the United States” under the UNFCCC. As such, the coming years will likely see a precipitous decline, if not a complete halt, of climate finance flows—both bilaterally to developing countries and to designated multilateral institutions, such as the Green Climate Fund and the Climate Investment Fund.

The Response

In the absence of U.S. federal policy endorsing an international climate presence, many of the same mechanisms employed by individual states and the private sector during President Trump’s first term will again be deployed during his second term. For example, the withdrawal of U.S. funding will reduce the convention’s annual operating budget by 21% (roughly $7.4 million), leading to reduced conference hours and cancellation of regional events. In response, Bloomberg Philanthropies announced a pledge from a coalition of contributors to replace the lost governmental funding to support ongoing negotiations.⁹

Furthermore, the U.S. Climate Alliance is a net-zero focused, bipartisan coalition of 24 U.S. state governors (and two territories) set up in 2017 to uphold the objectives of the Paris Agreement after President Trump withdrew from the Agreement the first time. Currently, the Alliance is on track to meet the coalition’s target of reducing collective GHG emissions 26% below 2005 levels by 2025 and reaffirmed its commitment to align longer-term commitments with the U.S. NDC, as well as attend COP in lieu of a national presence.

^{1 https://treaties.un.org/doc/Publication/CN/2025/CN.71.2025-Eng.pdf.}

^{2 https://legalresponse.org/legaladvice/us-withdrawal-from-unfccc/.}

^{3 https://www.akingump.com/en/insights/alerts/calling-in-from-cop-29-what-you-missed-and-what-comes-next.}

^{4 https://unfccc.int/sites/default/files/2024-12/United%20States%202035%20NDC.pdf}

^{5 https://www.ogdc.org/wp-content/uploads/2024/03/COP28-OG-Decarbonization-Charter.pdf}

^{6 Lowering Organic Waste Methane Initiative Supports Global Methane Pledge, COP29 Declaration on Reducing Methane from Organic Waste | Climate & Clean Air Coalition}

^{7 https://unfccc.int/sites/default/files/2024-12/United%20States%202035%20NDC.pdf}

^{8 COP 29 Update: U.S. International Public Climate Finance  - United States Department of State}

^{9 https://www.reuters.com/sustainability/bloomberg-philanthropy-cover-us-climate-dues-after-paris-withdrawal-2025-01-23/}