In order to limit global warming to 2°C, the world needs to transition to a clean energy economy by investing an additional $1 trillion per year until 2050. Ceres calls this clean energy investment gap the “Clean Trillion”.
In 2010, world governments agreed to limit the increase in global temperature to 2°C to avoid the worst impacts of climate change. The International Energy Agency estimates an extra $36 trillion in clean energy investment is needed until 2050 to achieve this goal. This is an average of $1 trillion more per year compared to the ‘business as usual’ scenario over the next 36 years – equating to an approximate four-fold increase from current investment levels.
Ceres, which has coined the term “Clean Trillion”, outlines the challenge in a new report, Investing in the Clean Trillion: Closing the Clean Energy Investment Gap, released in January 2014. The report provides 10 recommendations for investors, companies and policymakers on the ways to reach the “Clean Trillion” goal:
The report outlines the importance of generating new investments in clean energy sources such as solar, wind and geothermal energy; energy efficiency; and energy smart technology such as power storage, fuel cells and carbon capture and storage. In addition to halving greenhouse gas emissions by 2050, investment will yield significant returns in the form of reduced fuel costs. Compared to fossil fuels, energy efficiency and renewable energy has greater job-creation potential.
Closer to home, Westpac has recently announced a partnership with the New Zealand CleanTech industry to establish a certification programme as it targets a 15% increase in its lending to the sector over the next two years. The bank currently lends more than $1 billion to the New Zealand CleanTech sector and it is aiming to add at least $150 million in new lending by the end of 2015.
For detailed recommendations regarding to clean energy investment, you can download Ceres’ whitepaper “Investing in the Clean Trillion”.