What is the cost of going green? Actually no one really knows for sure and it depends on the scope of the transition. But a recent study by the consultancy, McKinsey & Company said this: “We found that if you look at those (energy) systems today, we’re spending about $5.7 trillion (annually) on both high-emissions spending (gas power or internal-combustion-engine-based vehicles) and some low-emissions spending. Under a transition scenario, over the next three decades, that $5.7 trillion would need to rise to $9.2 trillion (a year). Also, about 75 percent of that $5.7 trillion is going to high-emissions spending. Going forward, 75 percent would need to go toward low-emissions spending. So it’s not just a scale-up of capital; it’s a reallocation of capital.” The finance system is integrating net zero with new financing commitments and mechanisms, but a $41 trillion funding gap remains. We already spend a lot of money for the current energy economy based on fossil fuels. Another challenge is to keep the lights on and manufacturing plants working while others are building a new energy infrastructure. There are even carbon taxes in some places. The topic of climate finance isn’t something we think much about so we am glad to see that we have Brad Handler from the Sustainable finance Lab of the Payne Institute for Public Policy at the Colorado School of Mines on the episode to help us better understand where the public and private investments are going to come from.ReferencesSustainable Finance Lab at the Payne Institute for Public Policy https://payneinstitute.mines.edu/payne-institutes-latest-initiative-sustainable-finance-lab/World Economic Forum https://www.weforum.org/stories/2022/01/net-zero-cost-3-5-trillion-a-year/