McKinsey Global Institute has issued a new report on the global cost of transitioning to net-zero carbon emissions by 2050 that says the world will need to spend $275 trillion, or an average of $9.2 trillion per year in new capital spending to transition physical assets for energy and land use in order to achieve the goal.
McKinsey's Net-Zero Transition Report says its new "order-of-magnitude" cost estimate for a worldwide economic transition to net-zero is "front-loaded," with spending rising from 6.8 percent of global GDP to as much as 8.8 percent of GDP between 2026 and 2030 before falling.
MGI says its estimate is based on the "simulation" of a "relatively orderly transition" that will be "universal" in scope but which will have uneven effects on sectors, geographies and communities as it creates growth opportunities.
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