The Net-Zero Transitions in Energy and Finance

Net-zero energy transition requires a paradigm shift that entails multiple and simultaneous transitions of different sociotechnical systems and swift, radical, and active pushes by many key societal actors. Commitments to net-zero emissions have reinforced the momentum for climate action and widened the inclusion of sectors involved. In particular, the financial sector is expected to reinforce the momentum by changing portfolios, institutions and business models. Against this backdrop, this book tackles multiple transitions in finance and energy systems to explore how such transitions might overcome coal lock-ins. This chapter elaborates on how finance and energy sectors have responded to commitments to net-zero emissions within and across sectors and have been pressured to undergo system transformation. The chapters presents an overview of the opportunities and risks of two bridging technologies – natural gas and transition finance – and raises the book’s two research questions: why the Paris–Glasgow financial regime for financing net zero has been slow in progress, and why highly coal-dependent small EMDEs are attracted to the shift to natural-gas-based electricity systems instead of those based on renewable energy sources. The chapter’s conclusion presents the structure of the book, abstracts of the chapters, and scholarly contributions.