What is the Green Premium?
The Green Premium is the additional cost of choosing a clean technology over one that emits more greenhouse gases.
Right now, clean solutions are usually more expensive than high-emissions ones, in part because we don’t factor the true economic and environmental costs of existing options like fossil fuels into the price we pay for them.
For instance: The average retail price of ground beef is $3.79 per pound, while a plant-based burger is $5.76 per pound. The Green Premium for a zero-carbon burger is the difference in cost between the two, or $1.97. But the regular burger doesn’t reflect the true cost of emissions generated in its production (usually in the form of methane released by livestock.)
Moving our immense energy economy to net-zero solutions will cost something—but with the right policies and focus, we can lower the Green Premium. Ultimately, we need that premium to be so low that everyone everywhere can choose the clean alternative. It’s crucial to understand what getting there will cost.