The World Bank has called for an additional $30 trillion investment to achieve global net-zero emissions goals by 2050.

In its “Net-Zero Industry Tracker 2024 Edition” report released on Friday, the global financial institution emphasised that without this significant capital injection, efforts to decarbonise hard-to-abate industries such as cement, steel, aviation, and heavy manufacturing could face substantial setbacks.

These sectors, critical to the global economy yet difficult to decarbonise, require extensive funding to transition to low-carbon alternatives and realise the ambitious net-zero goals.

“To remain on track for net-zero targets, an estimated $30 trillion in additional capital will be required by 2050 for the sectors under consideration. This represents approximately 45 per cent of the total incremental investment needed for the global net-zero transition by 2050,” the report stated.

Despite some progress, including reductions in emissions intensity and energy consumption across key sectors, the report warned that the scale of the challenge remains immense.

“Sectors must generate returns sufficient to attract investments in energy transition initiatives, which represent an 80 per cent increase in investment compared to current levels,” it added.

In particular, industries within the hard-to-abate category face significant barriers, ranging from high operational costs to the limited availability of commercially viable technologies capable of substantially reducing emissions.

The World Bank noted that this investment gap is exacerbated by the limited capacity of these sectors to absorb the substantial costs of transitioning while maintaining profitability.

The report also highlighted the crucial role of emerging technologies, such as artificial intelligence, in reducing costs. It pointed out that generative AI could enhance capital efficiency by 5–7 per cent, potentially lowering capital requirements for these sectors by $1.5–$2 trillion.

However, the World Bank warned that achieving these goals would require not only substantial investments but also stronger policy support and enhanced cross-regional collaboration.

The report argued that with many of these sectors already operating on thin profit margins, “policymakers must introduce stronger incentives that align with the objectives of hard-to-abate industries, energy providers, and consumers.”