The world can achieve net-zero greenhouse gas emissions by the middle of this century for an annual investment of US$1 trillion-US$2 trillion, or up to US$60 trillion over the next 30 years, a coalition of major oil firms, companies in other energy-intensive industries, and banks said.
The Energy Transitions Commission (ETC) is a coalition of 45 leaders from energy producers, energy-intensive industries, financial institutions, and environmental advocates, including BP, Shell, Sinopec Capital, Rio Tinto, ArcelorMittal, Bank of America, HSBC, Iberdrola, Ørsted, and Vattenfall.
In a new report this week, ‘Making Mission Possible,’ the coalition said that “it is undoubtedly technically feasible and economically affordable for the whole world to achieve net-zero GHG emissions by mid-century, with all developed economies meeting that objective by 2050 and all developing economies within the following 10 years.”
The ETC says that countries and companies have to believe that net-zero is feasible and economically affordable to start planning the policies to get to the net-zero vision.
The price tag for reaching a global net-zero economy over the next 30 to 40 years sounds monstrously high, but according to the ETC, the additional investments required, “while huge in absolute dollar terms, are only about 1% to 2% of global GDP per annum.”
“The costs of achieving this are very small, especially compared to the large adverse consequences that unmitigated climate change would trigger by 2050 and in subsequent years,” the coalition said in the report.
The biggest investment globally will be needed to build a global power system that can deliver 100,000 TWh per year, including new renewable electricity capacity, transmission and distribution networks, battery storage for flexibility, and additional technology deployment to supply interday and seasonal flexibility. All these investments in the power system would require an additional annual investment of US$1 trillion to US$1.5 trillion per year. The ramp-up of ‘green’ hydrogen production, transport, and storage will also need massive investments of US$3.7 trillion over 30 years, or US$130 billion annually, the coalition said.