Economics of climate change mitigation

For broader coverage of this topic, see Economic analysis of climate change.

Companies, governments and households have committed increasing amounts to decarbonization, including renewable energy (solar, wind), electric vehicles and associated charging infrastructure, energy storage, energy-efficient heating systems, carbon capture and storage, and hydrogen.[1][2][3]
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The economics of climate change mitigation is a contentious part of climate change mitigation – action aimed to limit the dangerous socio-economic and environmental consequences of climate change.[4]

Climate change mitigation centres on two main strategies: the reduction of greenhouse gas (GHG) emissions and the preservation and expansion of sinks which absorb greenhouse gases, including the sea and forests.

The economics of climate change mitigation are a central point of contention whose considerations significantly affect the level of climate action at every level from local to global.

For example, higher interest rates are slowing solar panel installation in developing countries.[5]

  1. ^ "Energy Transition Investment Hit $500 Billion in 2020 – For First Time". BloombergNEF. (Bloomberg New Energy Finance). 19 January 2021. Archived from the original on 19 January 2021.
  2. ^ Catsaros, Oktavia (26 January 2023). "Global Low-Carbon Energy Technology Investment Surges Past $1 Trillion for the First Time". Figure 1: Bloomberg NEF (New Energy Finance). Archived from the original on 22 May 2023. Defying supply chain disruptions and macroeconomic headwinds, 2022 energy transition investment jumped 31% to draw level with fossil fuels{{cite news}}: CS1 maint: location (link)
  3. ^ "Global Clean Energy Investment Jumps 17%, Hits $1.8 Trillion in 2023, According to BloombergNEF Report". BNEF.com. Bloomberg NEF. 30 January 2024. Archived from the original on 28 June 2024. Start years differ by sector but all sectors are present from 2020 onwards.
  4. ^ Fisher, B.S.; et al. (2007). "Issues related to mitigation in the long term context.". In B. Metz; et al. (eds.). Climate Change 2007: Mitigation. Contribution of Working Group III to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change. Cambridge University Press. Archived from the original on 16 November 2018. Retrieved 20 May 2009.
  5. ^ "The global backlash against climate policies has begun". The Economist. ISSN 0013-0613. Retrieved 11 November 2023.