Global energy transition would create overall economic gains

Changing the world’s energy supply from fossil fuels to renewable sources would result in net economic gains, according to a study by the International Renewable Energy Agency (IRENA) and the International Energy Agency (IEA). The agencies’ study, published in the context of the international conference Berlin Energy Transition Dialogue, argues that global CO₂ emissions can be reduced by as much as 70 percent by 2050 “and completely phased-out by 2060 with a net positive economic outlook.” “The economic case for the energy transition has never been stronger,” IRENA director Adnan Z. Amin said, adding that delaying the transition will only result in greater costs. The study estimates that investments needed for decarbonising the world’s energy sector amounted to less than 30 trillion dollars until 2050, a mere 0.4 percent of global GDP, which in turn would generate a 0.8 percent boost in GDP. IEA director Fatih Birol argued that in order to achieve an emissions reduction in line with the Paris Climate Agreement goals would require “95 percent of electricity to come from low-carbon sources, 70 percent of all cars to run on electricity and the entire world’s building stock to be  retrofitted.” The study holds that inevitable job losses in the fossil fuels-based industry associated with this substantial shift would be more than offset by new jobs generated in the renewables sector.

Find a press release on the IRENA / IEA study in English here.