Report

How big is the Net Zero financing gap?

Decarbonizing the global economy is the greatest challenge of our times – and the biggest investment opportunity in history - we assess the scale of the financing needed to deliver Net Zero. 

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The net-zero finance gap

Global overview

For investors and policymakers, deciding where to focus requires better climate finance data. That’s why A&O Shearman, in partnership with Climate Policy Initiative, embarked on a landmark study to assess the scale of the financing needed to deliver Net Zero. Below you can explore the data, which breaks down the investment needed each year between now and 2050 across a range of technologies. You can also read our report for the full context, and view the methodology that underpins the numbers.

Institutions that are well prepared to embark on Net Zero pathways will be able to take full advantage of decarbonization-focused policy shifts and avoid being stuck with stranded assets. In this interactive report, produced in partnership with Climate Policy Initiative, we identify which policies can accelerate financial flows, as well as the public and private organizations best positioned to help deliver ambitious goals. Our teams examine the sectors requiring the greatest investment, the interplay between public and private finance, and the infrastructure that will enable the green transition. 
Summary

We estimate that delivering Net Zero will require USD6.2 trillion of climate finance per year between now and 2030, and USD7.3trn per year by 2050 – a total of almost USD200trn.

The sectors with the greatest climate finance needs are transport (50%) and energy systems (32%). The top priorities for investment are building energy efficiency, decarbonizing industrial processes, developing clean energy storage solutions, and bolstering carbon capture, utilization, and storage.

Public financial institutions should channel their funding to mobilize private finance and achieve higher impact, as well as provide political risk support, guarantees to reduce foreign exchange risk, and liquidity to increase funding for less commercially viable sectors and regions.

Related people

This report was developed by lawyers across our global network with leadership roles in infrastructure, environment, climate & regulatory, international trade, international arbitration, public law, financial services, energy and Consulting.