Socioeconomic Tipping Points in the Energy Transition: Expanding Climate Transition Risk Scenario

About This Report iii
Summary v
Figures vii
Tables ix

Socioeconomic Tipping Points in the Energy Transition: Expanding Climate Transition Risk Scenarios for Financial Stress Testing 1

Key Findings 2

Background 3

Approaches to Modeling Transition Risk 6

Regulatory Developments Regarding Climate Transition Risk 9

Scenario Narratives 11

Moonshot Overload: Aggressive Policies, Inflationary Backlash, and Political Polarization 11

The Great Awakening: Years of Preparation and a System Shock Rapidly Shift Public Opinion 18

Loop the Loop: Material Scarcity, Price Spikes, and Industry Transformation 25

Discussion 32

Modeling Gaps and Limitations 35

Socioeconomic Tipping Point Scenarios and the NGFS Framework 38

APPENDIX A – Approach to Arrive at Scenario Narratives 41

APPENDIX B – Modeling Material Flows and Technology Life-Cycle Assessment 46

Abbreviations 49

Notes 51

References 57