A recent study by European researchers reveals that the compensation planned for workers affected by the coal phase-out aligns with or is lower than current carbon prices in regions like the European Union. The study, published in Nature Communications, assesses 23 countries with existing phase-out plans, estimating the compensation cost at $US200 billion. This expense is justified by approximately 6 gigatons of avoided CO2 emissions, making the cost per ton of CO2 much lower than European carbon prices.
Despite this progress, significant challenges remain, especially with major coal users like China and India, which lack phase-out plans and would require trillions in compensation to meet Paris Climate Agreement goals. The researchers emphasize the critical role of international funding, such as Just Energy Transition Partnerships (JETPs), to support these transitions. However, financing these compensations poses a significant challenge to global climate efforts.
