• About
    • Which Energy Mix is this?
  • Climate News Network Archive
  • Contact
The climate news that makes a difference.
No Result
View All Result
The Energy Mix
  • Canada
  • UK & Europe
  • Fossil Fuels
  • Ending Emissions
  • Community Climate Finance
  • Clean Electricity Grid
  • Cities & Communities
SUBSCRIBE
DONATE
  • Canada
  • UK & Europe
  • Fossil Fuels
  • Ending Emissions
  • Community Climate Finance
  • Clean Electricity Grid
  • Cities & Communities
SUBSCRIBE
DONATE
No Result
View All Result
The Energy Mix
No Result
View All Result
  • Canada
  • UK & Europe
  • Fossil Fuels
  • Ending Emissions
  • Community Climate Finance
  • Clean Electricity Grid
  • Cities & Communities
  FEATURED
Renewables ‘Set to Soar’ with 440 GW of New Installations in 2023: IEA June 4, 2023
Greek Industrial Giant Announces 1.4-GW Alberta Solar Farm, Canada’s Biggest June 4, 2023
Shift to Remote Work Cuts Commutes, Frees Downtown Space for Affordable Housing June 4, 2023
2.7M Hectares Lost, Nova Scotia at Ground Zero in ‘Unprecedented’ Early Wildfire Season June 4, 2023
Is Equinor’s Bay du Nord ‘Delay’ a Cancellation in Slow Motion? June 1, 2023
Next
Prev

Fossil fuels ‘may prove worthless’

February 15, 2013
Reading time: 3 minutes
Primary Author: Alex Kirby

 

EMBARGOED until 0001 GMT on Friday 15 February A leading UK university is launching a research programme to help businesses and policy-makers to protect themselves from investments which could be left worthless by climate change. LONDON, 15 February – The University of Oxford has begun a programme of research to identify high-carbon sectors and assets that could be devalued or written off if the world takes resolute action to limit emissions of greenhouse gases. It seeks to help investors to avoid sinking money in potentially useless assets that might ultimately lose their entire value, turning into what are known as “stranded assets”. Assets become stranded if they are replaced by greener alternatives or new technologies, or are subject to new regulations or resource constraints. In 2012 the International Energy Agency said the world was on course for average temperature rises of at least 4°C, double the limit agreed by world governments. So, it said, a significant part of the world’s known fossil fuel stores would have to stay in the ground to fulfil international climate commitments and reduce dangerous impacts. The Potsdam Institute for Climate Impact Research has calculated that to reduce the chance of exceeding 2°C warming to 20%, the global carbon budget for 2000-50 is 886 gigatonnes of CO2. Discounting emissions from the first decade of this century leaves a budget of 565 gigatonnes for the remaining 40 years to mid-century. However, the known fossil fuel reserves declared by energy and mining companies is equivalent to 2,795 gigatonnes of CO2. If the world wants to keep climate change to below 2°C, then, 80% of those reserves can never be burned: they are in fact valueless. According to the Carbon Tracker Initiative, “this means that governments and global markets are currently treating as assets reserves equivalent to nearly five times the carbon budget for the next 40 years. The investment consequences of using only 20% of these reserves have not yet been assessed.’’

Safer homes for funds

  Asset stranding is currently little understood, but the implications are potentially very significant. It could have a direct effect on millions of small savers too, as many universities and pension funds have big investments in hydrocarbon companies (and see our story on 1 February). The researchers, from Oxford’s Smith School of Enterprise and the Environment, will try to find out which assets and sectors are most at risk and how to respond to the challenges. The former MP John Gummer, now Lord Deben, chairs the Committee on Climate Change, an independent group which advises the UK Government. Speaking at the School, he stressed the need for businesses and policy makers to adapt to the new economic landscape. He said: “Investors continue to deploy hundreds of billions of pounds into polluting and unsustainable sectors. In many cases these investments will not be worth what investors think. “Climate change, scarcer resources and new disruptive technologies will reduce value and strand assets. If investors better understand the risks of investing in these assets they will be attracted to greener alternatives and see them as better business propositions and safer places for their funds.” Professor Gordon Clark, director of the Smith School, said: “We are looking at how changes in regulation, pricing, technology, society and climate could be a risk to a range of polluting assets.. Our new programme is creating a critically important space for these issues to be understood and for appropriate responses to be developed.” The four-year research programme’s first project is to focus on the international supply chain for the agricultural sector, examining methods of transport and production. Later projects will probably include transport, power generation, real estate and a range of commodities. The researchers aim to create new tools to understand and manage the risks of asset stranding. They will also analyse  investor portfolios to learn about risk exposures and will compile case studies of best practice. The programme is being supported by Aviva Investors, Bunge Ltd, Climate Change Capital Ltd and HSBC Holdings plc, with non-financial partners including the Carbon Tracker Initiative, Trucost and WWF-UK. – Climate News Network

  • The climate news you need. Subscribe now to our engaging new weekly digest.
  • You’ll receive exclusive, never-before-seen-content, distilled and delivered to your inbox every weekend.
  • The Weekender: Succinct, solutions-focused, and designed with the discerning reader in mind.
Subscribe



in Climate News Network

The latest climate news and analysis, direct to your inbox

Subscribe

Related Posts

moerschy / Pixabay
Biodiversity & Habitat

Planetary Weight Study Shows Humans Taking Most of Earth’s Resources

March 19, 2023
42
U.S. Geological Survey/wikimedia commons
Biodiversity & Habitat

Climate Change Amplifies Risk of ‘Insect Apocalypse’

December 1, 2022
57
Alaa Abd El-Fatah/wikimedia commons
COP Conferences

Rights Abuses, Intrusive Conference App Put Egypt Under Spotlight as COP 27 Host

November 14, 2022
30

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

I agree to the Terms & Conditions and Privacy Policy.

Trending Stories

/MaxPixels

‘Substantial Damage’, No Injuries as Freight Train Hits Wind Turbine Blade

May 25, 2022
14.7k
Natural Resources Canada

2.7M Hectares Lost, Nova Scotia at Ground Zero in ‘Unprecedented’ Early Wildfire Season

June 4, 2023
207
sunrise windmill

Renewables ‘Set to Soar’ with 440 GW of New Installations in 2023: IEA

June 5, 2023
169
Pixabay

Greek Industrial Giant Announces 1.4-GW Alberta Solar Farm, Canada’s Biggest

June 4, 2023
140
Equinor

Is Equinor’s Bay du Nord ‘Delay’ a Cancellation in Slow Motion?

June 1, 2023
893
Neal Alderson/Twitter

Out-of-Control Wildfire Burns Homes, Forces Evacuations Outside Halifax

May 29, 2023
2.7k

Recent Posts

Oregon Department of Transportation/flickr

Shift to Remote Work Cuts Commutes, Frees Downtown Space for Affordable Housing

June 5, 2023
95
Clairewych/Pixabay

Demand Surges for Giant Heat Pumps as Europe Turns to District Heating

June 4, 2023
104
nicolasdebraypointcom/pixabay

Factor Gender into Transportation Planning, IISD Analyst Urges Policy-Makers

June 4, 2023
40
moerschy / Pixabay

Federal Climate Plans Must Embrace Community-Driven Resilience

June 4, 2023
65
debannja/Pixabay

Austin, Texas Council Committee Backs Fossil Non-Proliferation Treaty

June 4, 2023
97
Ottawa Renewable Energy Co-op/Facebook

‘Hinge Moment’ for Humanity Demands ‘YIMBY’ Mentality: McKibben

June 1, 2023
81
Next Post

Fossil fuels 'may prove worthless'

The Energy Mix - The climate news you need

Copyright 2023 © Energy Mix Productions Inc. All rights reserved.

  • About
  • Contact
  • Privacy Policy and Copyright
  • Cookie Policy

Proudly partnering with…

scf_withtagline
No Result
View All Result
  • Canada
  • UK & Europe
  • Fossil Fuels
  • Ending Emissions
  • Community Climate Finance
  • Clean Electricity Grid
  • Cities & Communities

Copyright 2022 © Smarter Shift Inc. and Energy Mix Productions Inc. All rights reserved.

Manage Cookie Consent
To provide the best experiences, we use technologies like cookies to store and/or access device information. Consenting to these technologies will allow us to process data such as browsing behaviour or unique IDs on this site. Not consenting or withdrawing consent, may adversely affect certain features and functions.
Functional Always active
The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.
Preferences
The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.
Statistics
The technical storage or access that is used exclusively for statistical purposes. The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.
Marketing
The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.
Manage options Manage services Manage vendors Read more about these purposes
View preferences
{title} {title} {title}