Investments and financial flows induced by climate mitigation policies

Arbeitspapier

In this paper we use the hybrid integrated model WITCH to quantify and analyze the investments and financial flows stimulated by a climate policy to stabilize Greenhouse Gases concentrations at 550ppm CO2-eq at the end of the century. We focus on investments to decarbonize the power sector and on investments in knowledge creation. We examine the financial flows associated with the carbon market and the implications for the international trade of oil. Criticalities in investment requirements will emerge when coal power plants with carbon capture and sequestration and nuclear power plants are deployed around 2020-2040, both in high and low income regions. Investments in energy related R&D increase sharply and might cause stress in the short term. However, the transition to a low-carbon world, although costly, appears to be manageable from a financial point of view. In particular, R&D financial needs can easily be accommodated using revenues from the carbon market, which is expected to eventually become more important than the oil market in terms of traded value.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Nota di Lavoro ; No. 2010,13

Classification and Topics

• Classification: Wirtschaft ; Sustainable Development ; Energy and the Macroeconomy ; Climate; Natural Disasters and Their Management; Global Warming ; Management of Technological Innovation and R&D ; Macroeconomic Analyses of Economic Development
• Subject: Climate Change ; Mitigation ; Carbon Finance ; Emission Trading ; Energy Investments

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Bastianin, Andrea ; Favero, Alice ; Massetti, Emanuele
• Event: Veröffentlichung
• (who): Fondazione Eni Enrico Mattei (FEEM)
• (where): Milano
• (when): 2010

Further information

• Handle: http://hdl.handle.net/10419/43552
• Last update: 10.03.2025, 11:43 AM CET