The net-zero transition requires the rapid development at scale of new technologies, energy-efficient infrastructure, and carbon capture and storage. A carbon price, together with the elimination of fossil-fuel subsidies, would give investors powerful incentives to finance these and other imperatives.
The quest for carbon neutrality has begun in earnest. More than 70 countries1, including the world’s biggest polluters, have set net-zero targets for carbon dioxide emissions, with hundreds of cities, companies, and investors committing to complementary strategies. But a successful net-zero transition will require a fundamental transformation of the real economy. Russia’s invasion of Ukraine, which has roiled global energy markets, has reawakened concern with energy independence. Now is the time to put a price on carbon as it is essential to drive the shift from our current overwhelming dependence on fossil fuels.
Read the full article to understand why it is vital for investors to understand climate risks, what information is lacking today and how carbon pricing can give investors powerful incentives to finance the energy transition.
- Source: United Nations, Net zero coalition.