The Cost to Turn Back Global Warming

According to an article appearing in the April 4th, 2022 edition of The Wall Street Journal (WSJ), the cost to reduce global warming between now and 2050 will be US $131 trillion according to the International Renewable Energy Agency (IRENA). A breakdown of where the money needs to be spent according to WSJ goes as follows:

• 26% to be spent on renewable energy
• 22% on electrification
• 12% on coal and nuclear
• 3.5% covering others
• 2.5% on innovation

The cost of phasing out fossil fuels to transition to renewable energy will cost $24 trillion. An estimated $116 trillion will be needed to be spent to improve overall energy efficiencies across the planet and to build a 100% electrification infrastructure. And, of course, technological innovation will deliver energy and climate-resilient solutions which will only come about with more investment.

Where will the money come from? In the WSJ article, an accompanying video breaks down the investment distribution. In it, John Kerry, the current US climate change czar, notes that a partnership of governments, the financial sector, and industry will be required to pay for the fight.

No matter what we do starting today and going forward, we are living with the latent warming that will continue from legacy amounts of carbon dioxide (CO2), methane, and other anthropogenic-produced greenhouse gasses (GHG) already in the atmosphere. So mean atmospheric temperatures will continue to rise to likely exceed 1.5 Celsius (2.7 Fahrenheit) rise by the century’s end.

This last observation is being reinforced by the latest IPCC report, released on April 4th. the final in a group of three released in the last few months. This one, called the IPCC Working Group III report, focuses on mitigation requirements needed to keep the planet from overheating.

The report states that with the right policies, infrastructure, and technologies we can change our lifestyles to achieve between 40 and 70% reductions in GHG emissions by mid-century with commensurate improvements to our overall collective health and wellbeing.

It states that limiting warming to 1.5 Celsius will require us to reach peak GHG emissions in the next three years and then begin reducing them by 43% by 2030. In the same time frame, we would have to reduce methane emissions by 33%.

If we don’t meet net-zero emissions objectives in the decade of the 2050s, we will exceed 1.5 Celsius. And even if we delay getting to net-zero by 2070 when we can expect temperatures to rise by 2.0 Celsius (3.6 Fahrenheit), we still have to get started before 2025 with a much smaller emissions reduction target of 25%.

To achieve the 1.5 Celsius target, the report indicates there is sufficient global capital from both the public and private sectors to achieve the better result. So where should we be spending the money needed to get that result?

In 2019, the report states:

• 34% of GHG emissions were produced by the energy supply sector.
• 24% from industry.
• 22% from agriculture, forestry and other land use.
• 15% from transportation.
• 6% from buildings.

Industry and buildings produced 90% of indirect emissions which if reallocated to the above breakdown would increase the former’s contribution to 34%, and the latter to 16%, and reduce the energy supply sector’s contribution to 12% of the global total.

Among the report’s findings is a sustained decrease in the unit cost over the last decade of each of the following:

• Solar energy 85%.
• Wind energy 55%.
• Lithium-ion batteries 85% and a vast increase in deployment greater than 10 times for solar energy and more than 100 times for electric vehicles (EVs).

Among many other findings describing progress in the last decade include:

• Adoption of low-emissions technologies is lowest in low-income countries for many reasons, one being limited financial capacity and a lack of local support resources.
• Sensors, the Internet of Things, robotics and artificial intelligence, all fast-growing technological advances in the last decade, may help mitigate climate change, but at the same time, usage may lead to increased energy demand, and contribute to increased electronic waste.
• Consistent growth in government and institutional policies addressing climate change with over 20% of global GHG emissions being covered by carbon taxes or emission trading systems.
• The price put on carbon in countries and by institutions is insufficient to change consumer or business behaviours to make a significant difference in global GHG emissions.
• Many countries have adopted enhanced energy efficiency policies, reduced deforestation, accelerated technology deployment and seen some results in terms of reduced GHG emissions.
• Financial flows focused on climate mitigation projects have increased 60% between 2013 and 2020.
• GHG emission pathways to limit warming to no more than 2 Celsius require reduction rates of up to 700 megatons of CO2 annually between 2020 and 2030, and 1,400 to 2,000 megatons a year between 2030 and 2050.
• Based on current trends global mean temperatures will likely exceed 1.5 Celsius by an overshoot of 0.15 to 0.3 Celsius by the century’s end.
• To return to 1.5 by 2100 will require net-negative CO2 emissions of 380 Gigatons from 2050 to the century’s end.
• Projected cumulative future CO2 emissions over the lifetime of existing and planned fossil fuel projects will push us well past 1.5 and closer to 2 Celsius unless emission abatement strategies are deployed for the sector.
• The energy sector will require a major transition with the reduction in fossil fuel use, deployment of low-emission energy sources, and improvements in efficiency and conservation. Continued reliance on fossil fuels will lock in GHG emissions with consequential temperature increases exceeding 1.5 Celsius, 2.0 Celsius or higher.
• A substantial amount of existing fossil fuel resources will have to remain unburned with a considerable amount of the infrastructure stranded. Only carbon capture can prolong fossil fuel use if we are to limit warming to 2 Celsius or below.
• Fugitive methane emissions from fossil fuel production and transport (accounting for 18% of GHG global emissions) can be avoided using currently available technologies that could lead to a between 50 and 80% reduction.
• Carbon capture sequestration (CCS), and carbon capture and utilization (CCU or CCUS) for planned and existing fossil fuel projects as mentioned above need to achieve 90 to 95% efficiency to stay below the 2 Celsius rise.
• Net-zero CO2 emissions can be achieved in the industrial sector through the implementation of material efficiencies, circular material flows, transformational changes in production processes and the adoption of abatement technologies such as CCS and CCUS. Progress on basic materials and production processes implementing low to zero-GHG emissions are currently in pilot projects to near-commercial adoption at present.
• Industries are likely to relocate to where there are abundant low-GHG energy resources which will have an impact on employment.
• Urban infrastructure redesign can significantly reduce GHG emissions by adopting changes to energy sourcing, production and use, material consumption, electrification, enhancing carbon uptake and storage (green roofs, permeable surfaces, parks and green spaces, and bio-based building materials), and outside city boundaries through implementing similar policies for supply chains. This will include repurposing and retrofitting buildings, supporting walking and cycling over motor transport, increasing public transit, co-locating jobs closer to where people live

What the report is telling us is that reversing warming after a century of abusing the planet through unsustainable energy use growth, and our patterns of consumption and production, we have an obligation to the generations of humans that follow us, and to all life on the planet, to take action to create a sustainable future. And the bill to correct this century of abuse will be as much as $131 trillion, at least, according to IRENA as reported in WSJ. The IPCC doesn’t put a price tag on what we need to do but it does provide mitigation guidance that we need to heed and not a day too soon.