Carbon budgets and sub-prime assets

kristyReforming Global Finance, SRI/ESG News

The concept of fossil fuel reserves exceeding the carbon budget continues to gather acceptance. Last week the IEA published its World Energy Outlook 2011. In the Climate Change Chapter, the IEA uses the same approach as Carbon Tracker to show that thee numbers don’t add up. See attached extract for more information.

Al Gore has talked about stranded assets before, but reiterated his belief that fossil fuels are the new sub-prime assets in the economy due to the short-termism of investors:

“We now have about $7 trillion’ worth of sub-prime carbon assets in the global economy,” he said. “Their value, like the sub-prime mortgages, is based on an assumption that is highly questionable. The assumption is that it is perfectly O.K. to dump 90 million tons of heat-trapping pollution into the thin shell of the atmosphere surrounding our planet every 24 hours as if the atmosphere is an open sewer.”

Read the full article at: http://www.greenbiz.com/blog/2011/11/02/bsr-2011-al-gore-says-short-term-thinking-functionally-insane

Carbon Tracker is continuing to disseminate its thinking through opportunities to present at UNEPFI in Washington, Long Finance in London, the Institute of Chartered Accountants & Compta-Durable in Paris, and OccupyLSX in London.