This paper assesses the impact of a potential transition, looking not just at the investment required and the impact of a transition on the value of existing assets, but also looking more broadly at other factors that could affect the financial capacity of the global financial system, including operating expenses, risk, and the lifespan of investments. A savings in operating costs, for instance, could provide investors additional cash that could then be invested back into the economy.
Lower risk frees up reserves and enables investment in further growth. And longer asset life means that investments need not be replaced as often, freeing cash for investment that would otherwise be needed for asset replacement.