Climate economics
Marginal Abatement Cost (MAC)
Definition
Marginal abatement cost is the incremental cost of avoiding one additional unit (typically a tonne of CO2-equivalent) of emissions with a given measure, compared with a baseline. Arranging measures in ascending cost order produces the marginal abatement cost curve (MACC), popularised by McKinsey's 2007 global curve and since expanded to cover more than a thousand abatement levers.
References
2007 first global MACC, 1,400+ levers in current versions
calculation method, origins, interpretation
Overview
What it means
Options left of the zero line (insulation, efficient lighting) have negative cost — they save money. The curve shows how much abatement is available at or below any carbon price, and where policy must push.
How it is used
Governments and companies use MACCs to prioritise decarbonisation portfolios, set internal carbon prices and compare sector pathways; critics note curves omit transaction costs, co-benefits and dynamic effects.
Why it matters
MAC thinking underpins cost-effective climate policy: it reveals that deep cuts are often cheaper than assumed and identifies the most economical sequence of action. **Note:** In-batch merges: 1703 and 1704 (marginal abatement cost duplicates) → this entry.