“While preventing more extreme warming is likely to have a positive economic impact over the next 30 years, the action required to deliver it could have an offsetting negative effect. Net, we estimate that keeping warming to 1.5°C would shave 2% off our base-case GDP forecast for 2050,” says Peter Martin, WoodMac’s chief economist.
Things will get worse before they get better — it seems the analyst’s pet phrase now applies to climate finance too.
At today’s pace, global temperatures are set to reach 2.5–2.7°C above pre-industrial levels by mid-century. While the world has the means to cap global warming to the 1.5°C limit agreed in the Paris Accords, the accelerated energy transition will come with a hefty price tag, warns UK-based natural resource research and consultancy group Wood Mackenzie.
