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The Australian economy could save $549 billion over the next decade if successfully transitioned to a clean economy and reduced emissions, according to researchers.

The University of Melbourne found the cost savings when comparing building clean, sustainable power sources to current policies.

And the longer-term savings potential is even more eye-catching: if the status quo — the current trajectory towards a four-degree increase in global temperatures by 2100 — is maintained, it will cost the economy $762 billion by 2050, blowing out to more than $5 trillion by the beginning of the next decade.

The costs of emission reduction and fears of lost jobs in traditional fossil fuel industries are minuscule compared to the damage climate change is expected to have, says Professor Tom Kompas from the university.

“Our work shows that meeting the Paris target of a 26 per cent reduction in emissions by 2030 would result in a 0.14 per cent fall in Australia’s cumulative GDP from 2019 to 2030 of $35.5 billion. On the other hand, the potential damages from climate change over the same period with current global and Australian policy would result in more than $584 billion in losses from infrastructure damage and losses in agricultural and labour productivity,” he said.

“The cost of renewable energy is falling very fast and we need to take advantage of this, putting price instruments or renewable targets in place to reap lower costs for electricity.”

The ASX offers investors exposure to a number of clean energy stocks, including Carbonxt (ASX:CG1), which develops and markets specialised activated carbon (AC) products, primarily focused on the capture of mercury and sulphur in industrial processes that emit substantial amounts of harmful air pollutants.

This content is produced by Star Investing in commercial partnership with Carbonxt. This content does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.