We measure the gains from phasing out coal as the average social cost of carbon times the quantity of avoided emissions. By comparing the present value of benefits from avoided emissions against the present value of costs of ending coal and replacing it with renewables, our conservative baseline estimate is that the world can realize a net gain of $85 trillion. This global net social benefit can be attained through an international agreement to phase out coal. We also explore how this net benefit is distributed across countries and find that most countries would benefit from a global coal phase-out even without any compensatory cross-country transfers. Finally, we estimate the size of public funds that must be committed under a blended finance arrangement to finance the cost of replacing coal with renewables.

The main result of the paper can be explored in this page. Additionally, you can explore the climate financing needed to phase out coal by country or region, or as an annual timeseries. Feel free to pick your own parameters to generate the results (the parameters are set to the baseline settings of the paper by default).

To get an overview of how the numbers are calculated, you may read the brief back-of-the envelope calculation of the cost and benefit using only public data from IEA, NGFS, and Our World in Data.

  80 USD/tCO2


Present value of benefits of phasing out coal (in trillion dollars) 114.04
Present value of costs of phasing out coal (in trillion dollars) 29.03
       Opportunity costs (in trillion dollars) 0.05
       Investment costs (in trillion dollars) 28.98
Carbon arbitrage (in trillion dollars) 85.01
Carbon arbitrage relative to world GDP 1.3 %
Carbon arbitrage (in dollars) per tonne of coal production 136
Carbon arbitrage (in dollars) per tCO2 60
Total coal production prevented (Giga Tonnes) 623.62
Total emissions prevented (GtCO2) 1425.55
Further temperature increase — on top of 1.1 ℃
already observed — prevented