Investors risk $6tn carbon ‘bubble’, warns report
Economies will see over $6tn in wasted capital as investments exploiting coal, oil and gas reserves are proved stranded as policies aim to limit global warming.
New research by Carbon Tracker Initiative and the Grantham Research Institute on Climate Change and the Environment at London School of Economics and Political Science reveals that despite fossil fuel reserves already far exceeding the carbon budget to avoid global warming of more than 2°C, $674bn was spent last year finding and developing new potentially stranded assets.
Between 60 per cent and 80 per cent of coal, oil and gas reserves of publicly listed companies could be classified ‘unburnable’ if the world is to achieve emissions reductions that mean an 80 per cent probability of not exceeding global warming of 2°C.
The research highlights that the 200 listed companies analysed in the study own 762 billion tonnes of carbon dioxide (CO2) through their reserves of coal, oil and gas which supports share value of $4tn and services $1.5tn in outstanding corporate debt.
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