Foreign Affairs

Reaching Aggressive 2050 Climate Targets Could Cost Nearly $75 Trillion, Analysis Finds

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The world will need to spend nearly $75 trillion by 2050 in order to achieve aggressive international climate change goals, according to a new report from energy consultancy and research firm Wood Mackenzie.

Cumulatively, investments would need to total $75 trillion, or about $2.7 trillion annually, if the world is to meet the 2050 net-zero carbon emission goals set forth by the United Nations (UN) Intergovernmental Panel on Climate Change (IPCC), according to the analysis. Additionally, global oil demand would need to peak in 2023, and it would need to drop to 30 million barrels per day (bpd) from its current level of about 102 million bpd in order to reach the targets established by the IPCC, according to the report.

The UN IPCC asserts that achieving net-zero by 2050 is the best way to keep global temperatures from rising by more than 1.5 degrees Celsius relative to pre-industrial levels, according to its website.

Global energy-related emissions would need to peak in 2023 to achieve global net-zero emissions by 2050, according to the analysis. While the U.S. and Western Europe have embraced expensive efforts to decarbonize their energy sectors, China permitted an average of two new coal plants each week in 2022, according to a report by the Centre for Research on Energy and Clean Air, and the global demand for energy is set to grow by 50% by 2050 relative to 2020 levels, according to the U.S. Energy Information Administration.

The share of global power generated by fossil fuels would need to fall from its current level of about 80% to 20% by 2050 if the net-zero goal is to be achieved, and the West would presumably need to overcompensate to account for the failures of countries in the Middle East, Africa and Southeast Asia to reach net-zero by 2050, according to Wood Mackenzie’s analysis.

The more likely scenario is that the world will not meet the IPCC’s targets, according to Wood Mackenzie’s analysis. In that base case, the governments of the world are projected to still spend about $2 trillion combined each year toward climate goals, even though the IPCC’s targets would be missed.

Beyond these considerable changes and expenditures, about 90% of all new vehicle sales worldwide would need to be electric vehicles (EVs) in order to reach the IPCC’s goal of limiting the total global temperature increase to 1.5 degrees Celsius relative to pre-industrial levels, according to the Wood Mackenzie analysis.

Representatives for the UN IPCC did not respond immediately to the Daily Caller News Foundation’s request for comment.