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Article

Funding of the Energy Transition by Monetary Sovereign Countries

by 1,* and 2,3
1
Faculty of Arts, Design & Architecture, School of Humanities & Languages, UNSW Sydney, Sydney, NSW 2052, Australia
2
Business School, Torrens University, Wakefield Street, Adelaide, SA 5000, Australia
3
Modern Money Lab, Adelaide, SA 5000, Australia
*
Author to whom correspondence should be addressed.
Academic Editor: Giacomo Di Foggia
Energies 2022, 15(16), 5908; https://doi.org/10.3390/en15165908
Received: 30 June 2022 / Revised: 4 August 2022 / Accepted: 12 August 2022 / Published: 15 August 2022
If global energy consumption returns to its pre-pandemic growth rate, it will be almost impossible to transition to a zero-emission or net-zero-emission energy system by 2050 in the absence of large-scale CO2 removal. Since relying on unproven technologies for CO2 removal is speculative and risky, this paper considers an energy descent scenario for reaching zero greenhouse gas emissions from energy by 2050. To drive the rapid transition from fossil fuels to carbon-free energy sources and ensure demand reduction, funding is needed urgently in order to implement four strategies: (i) technology change, i.e., implementing the growth of zero-carbon energy production, end-use energy efficiency and ‘green’ energy carriers, together with ongoing R&D on CO2 removal; (ii) reducing climate impacts; (iii) reducing energy consumption by social and behavioural changes; and (iv) improving human wellbeing while increasing social justice. Modern monetary theory explains how monetary sovereign governments, with their own fiat currencies, can create the necessary funding without financial constraints, although constraints do result from the productive capacities of their economies. The energy transition could be part-funded by a significant transfer of resources from monetary sovereign countries of the global North to the global South, financed by currency issuance. View Full-Text
Keywords: energy transition; energy descent; renewable energy; energy consumption; steady-state economy; monetary sovereignty; modern monetary theory energy transition; energy descent; renewable energy; energy consumption; steady-state economy; monetary sovereignty; modern monetary theory
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MDPI and ACS Style

Diesendorf, M.; Hail, S. Funding of the Energy Transition by Monetary Sovereign Countries. Energies 2022, 15, 5908. https://doi.org/10.3390/en15165908

AMA Style

Diesendorf M, Hail S. Funding of the Energy Transition by Monetary Sovereign Countries. Energies. 2022; 15(16):5908. https://doi.org/10.3390/en15165908

Chicago/Turabian Style

Diesendorf, Mark, and Steven Hail. 2022. "Funding of the Energy Transition by Monetary Sovereign Countries" Energies 15, no. 16: 5908. https://doi.org/10.3390/en15165908

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