The Green Agenda Would Punish Lower-Income Households the Most, Experts Say
Story by James Lynch • 15h
The costs of rapidly transitioning the world economy from natural gas to green energy sources over the coming decades will fall onto lower-income households the most, experts say.
The governor of the Bank of Italy, Fabio Panetta, acknowledged the potential negative impacts of a transition to “net-zero” carbon emissions while addressing an international energy conference on Monday.
“In fact, most climate change mitigation policies, such as carbon pricing, put pressure on the energy bills of businesses and households,” said Panetta, a former member of the European Central Bank governing council. “The consumption baskets of less affluent households are heavily weighted toward energy goods. They will therefore be disproportionately affected by the gradual increase in energy costs required for the transition.”
European and American consumers felt the burden of higher energy costs when oil prices spiked two years ago during the start of Russia’s war against Ukraine and inflation reached levels not seen since the 1970s. Inflation remains a top issue for American and European voters, as incumbent parties across Europe face difficult election prospects because of populist backlash.
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