A large electric utility company releases 62 million tons of greenhouse gases in to the environment each year. A company has committed to spending $1.2 billion in capital over the next 5 years to reduce its annual emissions by 5%. More will be spent after 5 years to reduce greenhouse gases further.
If the implicit cost of a ton of greenhouse gas is $387.10 per ton, how many billion dollars must be spent to reduce total emissions by 3% over the next 5 years?