WHAT ABOUT THE FINANCIAL COST? A burdensome expense or a worthwhile investment?

Fossil vs Future

It’s too expensive to make the change, isn’t it? The financial cost of addressing climate change is often used as a reason not to act. However, while estimates for how much the green transition will cost are indeed high, these numbers are dwarfed by the increased social and economic costs that we will incur if we continue with business as usual.

In this episode, James and Daisy explore the financial “cost” of climate action. What are the costs of acting on climate change? What are the costs of not acting? Is it detrimental for us to delay taking action?

SOME RECOMMENDATIONS:

• The Oxford Martin Programme on the Post-Carbon Transition – James contributed to this programme that was seeking to find out how we identify, model, and trigger sensitive intervention points to rapidly transition to a post-carbon society.
• RMI have some great resources on the costs of transition and the exponential change we’re already seeing. In June 2024, they published this informative paper on The Cleantech Revolution.

OTHER ADVOCATES, FACTS, AND RESOURCES:

• Climate Policy Initiative (2023): In 2021/2022, CPI tracked USD 1.3 trillion per year in global climate finance.
• Climate Policy Initiative (2024): “CPI estimates that climate finance needs to ensure global temperatures do not rise above 1.5°C range from USD 5.4 trillion to USD 11.7 trillion per year until 2030, and between USD 9.3 trillion and USD 12.2 trillion per year over the following two decades. These needs are dwarfed by the increased social and economic costs that will be incurred under business-as-usual (BAU) warming scenarios (which CPI estimates to be at least USD 1,266 trillion) and will only worsen the longer action is delayed.”
• RMI: “Financing the energy transition is a story of capital reallocation. Over the next seven years, renewable capex will roughly double and fossil fuel capex will roughly halve under core IEA scenarios. Falling fossil fuel capex will therefore provide half of the growth in renewable capex.”
• Samsung have developed a solid-state battery that boasts a 600-mile range, 9-minute charging time, and 20-year lifespan.
• Our World in Data (2020): Why did renewables become so cheap so fast? Renewable energy technologies follow leaning curves, which means it makes sense to invest in and scale these technologies now.

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Music: “Just Because Some Bad Wind Blows” by Nick Nuttall, Reptiphon Records. Available at https://nicknuttallmusic.bandcamp.com/album/just-because-some-bad-wind-blows-3

Producer: Podshop Studios

Huge thanks to Siobhán Foster, a vital member of the team offering design advice, critical review and organisation that we depend upon.

Stay tuned for more insightful discussions on navigating the transition away from fossil fuels to a sustainable future.