The Great Carbon Arbitrage

Alissa Kleinnijenhuis, Tobias Adrian and Patrick Bolton

INET Oxford Working Papers from Institute for New Economic Thinking at the Oxford Martin School, University of Oxford

Abstract: We measure the gains from phasing out coal as the social cost of carbon times the quantity of avoided emissions. By comparing the present value of the benefits from avoided emissions against the present value of costs of ending coal plus the costs of replacing it with renewable energy, our baseline estimate is that the world can realize a net gain of 77.89 trillion USD. This represents around 1.2% of current world GDP every year until 2100. The net benefits from ending coal are so large that renewed efforts, carbon pricing, and other financing policies we discuss, should be pursued. The IMF working paper can be found here: https://www.imf.org/en/Publications/WP/Issues/2022/05/31/The-Great-Carbon-Arbitrage-518464

Pages: 65 pages
Date: 2022-06
New Economics Papers: this item is included in nep-ene and nep-env
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Citations: View citations in EconPapers (3)

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Working Paper: The Great Carbon Arbitrage (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:amz:wpaper:2022-07

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