Macroeconomic impact of stranded fossil fuel assets

  title={Macroeconomic impact of stranded fossil fuel assets},
  author={Jean-François Mercure and Hector Pollitt and Jorge E. Vi{\~n}uales and Neil Robert Edwards and Philip B. Holden and Unnada Chewpreecha and Pablo Salas and Ida Sognnaes and A. Lam and Florian Knobloch},
  journal={Nature Climate Change},
Several major economies rely heavily on fossil fuel production and exports, yet current low-carbon technology diffusion, energy efficiency and climate policy may be substantially reducing global demand for fossil fuels1–4. This trend is inconsistent with observed investment in new fossil fuel ventures1,2, which could become stranded as a result. Here, we use an integrated global economy–environment simulation model to study the macroeconomic impact of stranded fossil fuel assets (SFFA). Our… 
Stranded fossil-fuel assets translate to major losses for investors in advanced economies
The distribution of ownership of transition risk associated with stranded fossil-fuel assets remains poorly understood. We calculate that global stranded assets as present value of future lost
Reframing incentives for climate policy action
With the prospects of renewable energies cap-turing markets previously dominated by fossil fuels, energy commodity exporters, in some cases affected by the resource curse 37 , lose export markets.
Reframing the climate policy game
A key aim of climate policy is to progressively substitute renewables and energy efficiency for fossil fuel use. The associated rapid depreciation and replacement of fossil fuel-related physical
Low‐carbon transition risks for finance
The transition to a low‐carbon economy will entail a large‐scale structural change. Some industries will have to expand their relative economic weight, while other industries, especially those
Climate Actions and Stranded Assets: The Role of Financial Regulation and Monetary Policy
Limiting global warming to well below 20C may result in the stranding of carbon-sensitive assets. This could pose substantial threats to financial and macroeconomic stability. We use a dynamic
Divestment may burst the carbon bubble if investors' beliefs tip to anticipating strong future climate policy
To achieve the ambitious aims of the Paris climate agreement, the majority of fossil-fuel reserves needs to remain underground. As current national government commitments to mitigate greenhouse gas
The public costs of climate-induced financial instability
Recent evidence suggests that climate change will significantly affect economic growth and several productive elements of modern economies, such as workers and land1–4. Although historical records
How Colombia can plan for a future without coal
Many countries – even those that recognise the need to curb global greenhouse gas emissions – continue to rely on fossil fuel exploitation as part of their economic development strategies and to


GDP and employment effects of policies to close the 2020 emissions gap
Four policies might close the gap between the global GHG emissions expected for 2020 on the basis of current (2013) policies and the reduced emissions that will be needed if the long-term global
The role of money and the financial sector in energy-economy models used for assessing climate and energy policy
ABSTRACT This article outlines a critical gap in the assessment methodology used to estimate the macroeconomic costs and benefits of climate and energy policy, which could lead to misleading
Macroeconomic analysis of the employment impacts of future EU climate policies
This article gives a detailed account of part of the modelling that was carried out for the assessment of the EU's proposed energy and climate targets for 2030. Using the macro-econometric simulation
Quantifying uncertainties influencing the long-term impacts of oil prices on energy markets and carbon emissions
Oil prices have fluctuated remarkably in recent years. Previous studies have analysed the impacts of future oil prices on the energy system and greenhouse gas emissions, but none have quantitatively
The geographical distribution of fossil fuels unused when limiting global warming to 2 °C
It is shown that development of resources in the Arctic and any increase in unconventional oil production are incommensurate with efforts to limit average global warming to 2 °C, and policy makers’ instincts to exploit rapidly and completely their territorial fossil fuels are inconsistent with this temperature limit.