THE ECONOMICS OF CLIMATE CHANGE
THE ECONOMICS OF CLIMATE CHANGE
Here's how painful the economic loss will be for the U.S. from unchecked climate change (Deloitte)
There will be a stinging period of economic transition, creating "winners" and "losers", then a breakeven point, and finally a newly competitive economy, the researchers argue. This once-in-a-generation transformation could add nearly 1 million more jobs to the U.S. economy by 2070, according to the report, "The Turning Point: A new economic climate in the United States."
"If the U.S. chooses to adopt an ambitious, holistic path towards decarbonization it could see net economic gains by 2048." - Deloitte's Scott Corwin
The U.S. economy from now to 2070 will have a new green Industrial Revolution. Climate action could deliver $3 trillion over the next 50 years if it accelerates towards a path of low emissions growth, says the Deloitte Economics Institute.
The choice is easy between a prosperous, decarbonized future or allowing the economic impact of climate change to disrupt our growth but getting to net-zero will require coordination, collaboration and upfront financial investment to rapidly transform existing industries into a series of complex, interconnected, emissions free systems.
If were able to keep climate change to below 2 degrees and we take that once in a generation transformation, we could see $3 trillion added to the economy, more than one million new jobs that otherwise wouldn't have existed compared to a world where climate change goes unmitigated.
"The report makes the case for another industrial revolution in the U.S - one built on low-emissions growth - to avoid significant losses from the climate crisis and to create a more dynamic, prosperous economy for the U.S.," said Alicia Rose, deputy CEO for Deloitte U.S. "The analysis shows that the battle to slow climate change is not only an aspirational goal, but an economic imperative for the U.S."
In this report, the Deloitte Economics Institute presents a different view of the economic future for the US, based on economic modeling from Deloittes Regional Climate Integrated Assessment Computable General Equilibrium Model (D.Climate). By explicitly accounting for the impacts of climate change on future productivity, economic output, and growth, the result is a new starting point that makes the costs and benefits of climate policy responses and investment decisions easier to see. Deloitte's analysis also shows how the US can rapidly shift its economy onto a dynamic, productive, and decarbonized growth pathway to achieve net-zero emissions by midcentury.
The report sets out a scenario with four key stages for the U.S. climate transition: Between now and 2025, the public and private sectors make bold decisions to rapidly transition to renewable energy. This involves transforming the electricity value chain, such as storage and transmission, that enables parallel and synchronized advances in the mobility, industrial and food systems.
From 2026 to 2040, the acceleration to net-zero creates major economic shifts in policy, energy systems, investment priorities and consumer behavior. From 2041 to 2050 - which is the turning point where the benefits of transition outweigh the costs - decarbonization of high-emission industries is almost complete. The costs of sustainable technologies decrease, and wider net economic gains are realized.
In 2050 and beyond, the U.S. economy is radically transformed and is more globally competitive in core industries. The economy achieves net-zero emissions, operating in a world that keeps global warming to below 2 C.
For more information: Deloitte: The Turning Point: A New Economic Climate in the United States
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