New Delhi: The world needs to invest a total of $ 275 trillion or around $ 9.2 trillion every year for almost three decades to stretch the economy to limit the increase in global temperatures to 1.5 degrees Celsius in an ambitious ‘zero’ emission plan in 2050 and the annual India And the annual capital expenditure for this transition will be around 11% of GDP compared to the global average of around 7.5% of GDP, the consultation group said, McKinsey, in his report on the ‘Net Zero Transition’, was released on Tuesday.
Annual expenditure on average $ 9.2 trillion will be an annual increase of $ 3.5 trillion from the current level.
“$ 3.5 trillion is approximately equivalent, by 2020, to be half of the profits of global companies, a quarter of total tax revenues, and 7% of household expenditure,” said the report while issuing increased expenditure in comparative terms.
Very large cumulative expenses, estimated by McKinsey, maybe almost two to three times higher than the previous climate economists, reflecting concerns about developing countries that exceed the target ‘zero zero’.
Most countries, including India, consistently said that they would need financial support from rich countries to move towards a carbon neutral future.
The report comes at most developed and developing countries have begun to move to the target of each ‘zero zero’, find out the cost of energy transitions and work prospects in the renewable sector.
McKinsey in his analysis views implications for demand, capital expenditure, production costs, and work in sectors that produce 85% overall emissions, with in-depth analysis of 69 countries.
Noted the amount needed for the investment in India, the report said annual capital expenditure on physical assets in the country would rise from around $ 300 billion by 2020 to an average of $ 600 billion between 2021 and 2050.
“Many capital will be used To reduce the use of existing coal power and expand the capacity of renewable electricity.
In India, almost 40% of expenditures will be in power, “said the report.
Record how India needs to invest most GDP to decarbonization, the report said, “In addition to capital expenditure for low-emission technology, India may also have to invest heavily than other countries in climate adaptation measures relatively high exposure to physical risks climate change “.
It underlines that the stranding of assets will be an acute risk in India because the average age of coal power plants in India is less than 15 years, compared with more than 30 years in the United States.
“Geography exposed includes in the Sub-Saharan Africa and India need to invest 1.5 times or more of the sophisticated economy as part of GDP today to support economic development and build low carbon infrastructure,” the report said, noted that the highest level.
Exposure is in countries with relatively lower per capita GDP, such as Bangladesh, India, and Kenya.
In energy demand in the mid-century, the report said that the biggest increase in demand globally would be in sub-Saharan Africa (a seven-fold increase compared to today) followed by India (fourfold) and developing country markets in Asia (three times Fold in Asia (three -Melipat).
“About 95% of the electricity generation globally in this scenario in 2050 will come from sources in addition to burning fossil fuels,” he said.
At the front of the job, McKinsey’s analysis showed that around 200 million jobs Direct and indirectly will be obtained and 185 million lost in 2050 from zero transition.
“The scale of the real location of the workforce may be smaller than that of other trends such as agricultural transition to non-agriculture, and automation,” he said.