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Chalmers University of Technology

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New study examines the price tag of phasing-out coal.

Coal phase-out is critical for addressing climate change, but poses risks to workers and communities dependent on coal. Researchers from Chalmers University of Technology in Sweden and Central European University in Austria found that over half of global coal phase-out plans include monetary compensation for affected parties, totaling USD 200 billion, excluding China and India. If these two major coal users adopt similar plans, compensation could exceed USD 2 trillion.
Governments, particularly in Europe, have begun phasing out coal, implementing 'just transition' strategies to support impacted workers and regions. Germany, for instance, has allocated over EUR 40 billion for this purpose. The study highlights that the cost of compensation per tonne of avoided CO2 emissions (USD 29-46) is below recent European carbon prices.
To meet Paris climate targets, participation from China and India, which have over half the world’s coal plants, is essential. Estimated compensation for these countries ranges from USD 2.4 trillion for the 2°C target to USD 3.2 trillion for the 1.5°C target. These figures are substantial compared to their economic capacities and current international climate finance.
International funding, such as Just Energy Transition Partnerships (JETPs), plays a crucial role in supporting coal phase-out in countries like Vietnam, Indonesia, and South Africa. However, the required compensation for China and India alone surpasses current international development aid and climate finance.
Addressing the social impacts of fossil fuel decline is vital to enabling rapid transitions and meeting climate goals.


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  • Jane Wangui

    4 d

    Wow...all nations should phase -out coal so as to reduce the emissions that come about due to the use of coal.

    1
    • Kevin

      1 w

      This is a very good study.India and China should follow suit in phasing out fossil fuels from their countries.

      2
      • We Don't Have Time

        1 w

        Dear Princess Your climate love has received over 50 agrees! We have reached out to Chalmers University of Technology by email and requested a response. I will keep you updated on any progress! To reach more people and increase the chance of a response, click the Share button above to share the review on your social accounts. For every new member that joins We Don't Have Time from your network, we will plant a tree and attribute it to you! /Adam, We Don't Have Time

        2
        • johnte ndeto

          1 w

          It's heartening to see that over half of global coal phase-out plans include monetary compensation, reflecting a commitment to fairness and equity in the transition process.

          6
          • George Kariuki

            2 w

            Yes, a just transition can help address the social costs of phasing out coal.

            6
            • johnte ndeto

              1 w

              @george_kariuki acknowledging and addressing the needs of affected parties, we can foster a smoother transition towards cleaner energy sources.

              4
            • Joseph Githinji

              2 w

              This is a great research to show the roadmap of coal phaseout and how the affected communities are compensated. This is the right way to go for Europe countries and I hope India and China would join in this campaign.

              6
              • johnte ndeto

                1 w

                @joseph_githinji Such initiatives highlight a broader understanding of the interconnectedness between environmental sustainability and social justice.

                4
              • Rukia Ahmed Abdi

                2 w

                This is an incredible research.I argue china and india to follow in the footsteps of Europe which has demonstrated "just transition" mechanism from coal to green energy.

                10
                • johnte ndeto

                  1 w

                  @rukia_ahmed_abdi it's paving the way for a more inclusive and resilient future.

                  4
                • walter lungayi

                  2 w

                  China and India should follow footsteps of Europe in phasing out fossil fuels. The substantial costs of compensating workers and communities affected by the phase-out of coal necessitate a concerted international effort. Increased global funding, tailored regional strategies, worker retraining programs, and collaborative public-private initiatives are needed to facilitate a just and effective energy transition that addresses the social impacts of fossil fuel decline.

                  10
                  • Rukia Ahmed Abdi

                    2 w

                    @walter_lungayi I agree with you.The fact that Europe in succeeding in transition from coal is a testimony that india and china can too succeed if the decide to follow suit

                    6
                    • johnte ndeto

                      1 w

                      @walter_lungayi addressing the socio-economic implications for affected workers and communities is quite commendable.

                      4

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