In Energy and Investing, Cornell (2019), I stressed that a critical aspect of the transitions from fossil fuels to renewable sources of energy was the sheer size and scope of the undertaking.  It involves not only a massive switch in the sources of energy but construction of extensive new infrastructure, reworking many manufacturing processes, and replacing a large part of the capital stock such as fossil fuel vehicles, and making significant lifestyle alterations.  The price tag of this undertaking that I called the “great transformation” reaches into the tens of trillions of dollars.  As the paper explored, such a massive undertaking raised numerous questions as to how it could be financed. 

            Data now becoming available on energy usage in 2018 underscore the point.  In light of all the talk about advancement in renewable technology, falling prices for green energy, and government proclamations to fight climate change, one might have expected a substantial drop in global CO2 emissions in 2018.  No such luck.  As the exhibit below taken from Fortune magazine summarizes, worldwide emissions rose 1.7% in 2018 to a record high.  It was the largest rate of growth seen since 2013.  Even the usage of coal rose.  The biggest growth in emissions was 4.8% in India, driven by a combination of economic expansion and continued population growth.  Chinese emissions also increased by 2.5%.  The bright spot was Europe where emissions fell 1.3%, but this was more than offset by a 3.1% growth in U.S. emissions.  All of makes it clear both how reliant the world economy is on fossil fuels and how difficult and expensive the great transformation is going to be. 


Cornell, Bradford, 2019, Energy and investing, Cornell Capital Group,

Fortune, 2019, Analytics: Seeing trends in the data, May 1, p. 15.

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