FacebookTwitterGoogle+RedditEmail

Fossil Fuels and the Impending Market Crisis

Pension funds need to be asked to stop investing in oil, coal and gas–conventional and unconventional forms alike.

While visions of billions dance in CEOs’ heads, the rapid melting of Arctic sea ice and permafrost threatens to unlock methane emissions that will incur costs in the tens of trillions, much of it associated with floods, droughts and storms in vulnerable regions.  So why are financially affluent nations still spending hundreds of billions subsiding fossil fuels? The U.S. government facilitates carbon-related investments in other ways too; consider the special rules enabling oil companies to avoid sanctions if they happen to kill a polar bear in the Chukchi Sea when prospecting.

The economic comeuppance might not be instant, but it’s on the way.  The 2°C global carbon budget—a key climate-change goal agreed at UN-led talks in Copenhagen in 2009—has a ceiling of 545 gigatons in carbon dioxide emissions to 2050; today’s national and private reserves amount to three times that level. Past 2°C, there is a risk of nonlinear tipping elements. Even a less ambitious, riskier target of 3°C would restrict known fossil fuel reserves significantly.

Having developed a Carbon Tracker concept to “improve the transparency of the carbon embedded in equity markets,” Investor Watch  asserts that we must leave 60-80% of listed corporations’known fossil fuel reserves untouched between now and 2050 if we are to have an 80% chance of keeping our atmosphere within of an average 2°C over pre-industrial levels.

The International Energy Agency accepts that zero energy-related emissions by 2075 is needed. Investments in clean energy have to double by 2020, the IEA claims (with the spending offset by fossil fuel purchases spared). But at the same time, the IEA says: “Fossil fuels remain dominant and demand continues to grow, locking in high-carbon infrastructure.”

Investor Watch challenges this, asserting that the presumed assets lack the market value claimed on the balance sheets, and may wind up stranded rather than locked in. For example, coal plants may be left inoperative when emissions regulations and alternative fuels render them worthless.

Many investment advisers have no idea about their clients’ exposure to carbon assets. Call one and find out. A more formal example of helpful pressure would be a shareholder confronting a financial-services company with information about stranded assets, and asking for a response.

As the clock ticks up to the 2015 UN climate negotiations, the obvious will be stated: fossil-fuel reserves being sought by Big Oil would increase greenhouse gases disastrously. We need to support a low-carbon economy if worldwide climate-sustaining negotiations would succeed—as they must. It’s high time for bold measures to prevent further ocean acidification, sea-level rise, and loss of glaciers and ice sheets—sources of water and life.

That means we must stop the coal, oil and gas prospecting now, not tomorrow. And the sooner investments in fossil fuels stop, the less harm the “carbon bubble” will do.

Lee Hall is a candidate for Vermont Law School’s LL.M. in environmental law (2014). Previously, Lee taught animal law and immigration law, and worked for more than a decade in environmental and animal advocacy. Follow Lee on Twitter:  @Animal_Law 

 

More articles by:

Lee Hall, J.D., LL.M., is an independent author, an adjunct professor of law and legal studies, a retail worker, and the creator of a studio for the Art of Animal Liberation on Patreon, for which support is always welcome and deeply appreciated.

Weekend Edition
February 15, 2019
Friday - Sunday
Matthew Hoh
Time for Peace in Afghanistan and an End to the Lies
Chris Floyd
Pence and the Benjamins: An Eternity of Anti-Semitism
Rob Urie
The Green New Deal, Capitalism and the State
Jim Kavanagh
The Siege of Venezuela and the Travails of Empire
Paul Street
Someone Needs to Teach These As$#oles a Lesson
Andrew Levine
World Historical Donald: Unwitting and Unwilling Author of The Green New Deal
Jeffrey St. Clair
Roaming Charges: Third Rail-Roaded
Eric Draitser
Impacts of Exploding US Oil Production on Climate and Foreign Policy
Ron Jacobs
Maduro, Guaidó and American Exceptionalism
John Laforge
Nuclear Power Can’t Survive, Much Less Slow Climate Disruption
Joyce Nelson
Venezuela & The Mighty Wurlitzer
Jonathan Cook
In Hebron, Israel Removes the Last Restraint on Its Settlers’ Reign of Terror
Ramzy Baroud
Enough Western Meddling and Interventions: Let the Venezuelan People Decide
Robert Fantina
Congress, Israel and the Politics of “Righteous Indignation”
Dave Lindorff
Using Students, Teachers, Journalists and other Professionals as Spies Puts Everyone in Jeopardy
Kathy Kelly
What it Really Takes to Secure Peace in Afghanistan
Brian Cloughley
In Libya, “We Came, We Saw, He Died.” Now, Maduro?
Nicky Reid
The Councils Before Maduro!
Gary Leupp
“It’s All About the Benjamins, Baby”
Jon Rynn
What a Green New Deal Should Look Like: Filling in the Details
David Swanson
Will the U.S. Senate Let the People of Yemen Live?
Dana E. Abizaid
On Candace Owens’s Praise of Hitler
Raouf Halaby
‘Tiz Kosher for Elected Jewish U.S. Officials to Malign
Rev. William Alberts
Trump’s Deceitful God-Talk at the Annual National Prayer Breakfast
W. T. Whitney
Caribbean Crosswinds: Revolutionary Turmoil and Social Change 
ADRIAN KUZMINSKI
Avoiding Authoritarian Socialism
Howard Lisnoff
Anti-Semitism, Racism, and Anti-immigrant Hate
Ralph Nader
The Realized Temptations of NPR and PBS
Cindy Garcia
Trump Pledged to Protect Families, Then He Deported My Husband
Thomas Knapp
Judicial Secrecy: Where Justice Goes to Die
Louis Proyect
The Revolutionary Films of Raymundo Gleyzer
Sarah Anderson
If You Hate Campaign Season, Blame Money in Politics
Victor Grossman
Contrary Creatures
Tamara Pearson
Children Battling Unhealthy Body Images Need a Different Narrative About Beauty
Peter Knutson
The Salmon Wars in the Pacific Northwest: Banning the Rough Customer
Binoy Kampmark
Means of Control: Russia’s Attempt to Hive Off the Internet
Robert Koehler
The Music That’s in All of Us
Norah Vawter
The Kids Might Save Us
Tracey L. Rogers
Freedom for All Begins With Freedom for the Most Marginalized
Paul Armentano
Marijuana Can Help Fight Opioid Abuse
Tom Clifford
Britain’s Return to the South China Sea
Graham Peebles
Young People Lead the Charge to Change the World
Matthew Stevenson
A Pacific Odyssey: Around General MacArthur’s Manila Stage Set
B. R. Gowani
Starbucks Guy Comes Out to Preserve Billionaire Species
David Yearsley
Bogart Weather
FacebookTwitterGoogle+RedditEmail