Business Leaders: Electrify the U.S. Economy to Reduce Climate Change Risks

Clean energy a major private sector investment opportunity say Bloomberg, Paulson, and Steyer

NEW YORK – Reducing the risk posed by climate change is both economically and technically achievable, according to a new report by the Risky Business Project, and would create significant new opportunities for American business. To do so would require building a clean energy economy in America – meaning widespread electrification, including of cars and homes, electricity generation from zero or low-carbon sources, and energy efficiency upgrades. A clear and consistent policy framework can unlock the investments needed for this transition.

“Companies and governments across the globe need to reduce their vulnerability to climate change and work to curb carbon emissions,” said Risky Business Project Co-Chair Henry M. Paulson. “Transforming the U.S. economy to rely on low-carbon, clean energy would be a massive undertaking, but this report shows we can achieve this vision with existing technologies.”

The new report, From Risk to Return: Investing in a Clean Energy Economy, finds that an average of $320 billion a year in private sector investment is needed through 2050 to build a clean energy economy and achieve the emissions reductions necessary to avoid the worst economic impacts of climate change. These necessary investments would be similar in scale to other major recent investments made by American business, including in computers and software at $350 billion per year over the past decade. Investments in clean energy could yield on average up to $366 billion in savings per year from reductions in spending on fossil fuels.

The country would gain over 1 million new jobs by 2030, with utilities, construction, and manufacturing seeing the largest gains. But 270,000 jobs would be lost in coal mining, oil, and gas related jobs, primarily in Southern and Mountain states.

“Coal is dying because cheaper and cleaner forms of energy are replacing it. This transition is both saving lives and saving us money, and the faster we can accelerate it, the better off our country will be,” said Michael R. Bloomberg, Co-Chair of the Risky Business Project.

The report calls on business leaders to put in place actionable plans for incorporating climate risk into their decision-making, including using an internal price on carbon in their calculations, and conducting detailed analyses of company exposure to climate risk.

“The stakes for our planet are higher than they have ever been and the cost of inaction is one our economy simply cannot afford,” said Risky Business Project Co-Chair Thomas F. Steyer. “Moving to clean energy will help mitigate the worst negative impacts of climate change and create enormous opportunity for American businesses. Now, more than ever, business must lead this transition for the sake of our climate, our country, and our economic security.”

The report outlines a series of policy principles necessary to achieve a transition to a clean energy economy. These include government removing subsidies for activities that increase climate risk, and providing incentives for innovation and for the deployment of clean energy. One way of accelerating the transition would be to put a price on carbon that accounts for the true costs of carbon pollution. The report also suggests that with global momentum moving towards reducing carbon emissions, U.S. competitiveness is at risk if American businesses do not invest in low-carbon technologies.

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