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3,641,114
MILLION TONS OF CO₂E IN THE ATMOSPHERE IN 2009
Atmospheric concentrations of CO₂e are rising due to increasing anthropogenic emissions. Unchecked, rising concentrations of CO₂e in the atmosphere will lead to catastrophic climate change.
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6,682,199
THOUSAND TONS OF CO₂E EMISSIONS IN 2007
Public electricity and heating in Annex I countries accounted for over 6.68 billion tons of CO₂e emissions annually in 2007.
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4,626,841
THOUSAND TONS OF CO₂E IN 2007
Transport is responsible for approximately 20% of global anthropogenic emissions, or more than 4.63 billion tons of CO₂e annually. Source: UNFCCC, 2009.
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1,449,778
THOUSAND TONS OF CO₂E IN 2007
Buildings are responsible for an estimated 1.45 billion tons of CO₂e in Annex I nations and over 20% of global anthropogenic emissions annually. Source: UNFCCC, 2009.
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1,301,663
THOUSAND TONS OF CO₂E EMITTED ANNUALLY IN 2007
Annex I industry emissions are over 1.3 billion tons of CO₂e annually. Global industry emissions account for approximately 24% of annual anthropogenic emissions. Source: UNFCCC, 2009.
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1,304,628
THOUSAND TONS OF CO₂E IN 2007
Emisisons from agriculture in Annex I countries totaled more than 1.43 billion in 2007 CO₂e emissions.
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7,613,844
THOUSAND TONS OF CO₂E IN 2006 FROM INDIA AND CHINA
The EIA estimates that 2006 energy-related emissions from non-OECD countries accounted for approximately 30%, of global anthropogenic CO₂e emissions, or 15.4 billion tons. Source: EIA, 2009.
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1,000,000
THOUSAND TONS OF CO₂E EMISSIONS
Biochar could potentially remove over 1 billion tons of CO₂e annually. In general, carbon management solutions could remove billions of tons of CO₂e from the atmosphere annually.
high carbon assets pose a risk
Investment in high-carbon assets that results in continual increases in annual CO2e emissions that lead to catastrophic climate change will lead to collateral losses of a much larger magnitude than experienced in the 2008 melt down.
Models Must Include Climate Risk
Financial and insurance models must be updated. Conventional energy and technology assets are being overvalued due to incorrect assessment of energy prices, volatility of fuel prices, security risk, and climate change risk.
Finance and Insurance
The finance and insurance industries govern the flows of capital and ultimately determine which technologies get developed and what infrastructure gets built. Influencing these decisions to shift capital to low-carbon sustainable investment is at the core of the Carbon War Room’s operations.
The finance and insurance industries govern the flows of capital and ultimately determine which technologies get developed and what infrastructure gets built. Influencing these decisions to shift capital to low-carbon sustainable investment is at the core of the Carbon War Room’s operations.
Under the current system, investments in fossil-based energy generation and conventional industry are increasing CO2e emissions globally that lead to catastrophic climate change. The IPCC projects global emissions increase of 16 billion tons of CO2e by 2020 under business-as-usual.
Investment in high-carbon assets that results in continual increases in annual CO2e emissions that lead to catastrophic climate change will lead to collateral losses of a much larger magnitude than experienced in the 2008 melt down. Low-carbon energy and technology assets poses significantly less risk and will increasingly gain the interest of investors looking for high return-low risk investments, of which pension funds and endowments are two important examples.
It is the mission of the Carbon War Room to redirect capital flows from fossil-based energy generation and conventional industry into sustainable low-carbon technologies that can generate and preserve wealth in the long term. These technologies offer higher returns to investors and society.
It is the mission of the Carbon War Room to redirect capital flows from fossil-based energy generation and conventional industry into sustainable low-carbon technologies that can generate and preserve wealth in the long term. These technologies offer higher returns to investors and society.
Redirecting investment to low-carbon technologies is critical to achieving CO2e stabilization targets that require avoiding the projected 16 billion ton annual increase in emissions by 2020.
Investment and insurance decisions are made based on risk-reward trade-offs. Existing asset classes are valued largely based on historical performance, which is problematic when systemic shifts affect the future risk profile. Conventional energy and technology assets are being overvalued based on inaccurate assessment of four key factors: (1) energy prices, (2) volatility of fuel prices, (3) security risk, and (4) climate change risk.
Market-based Approaches
Three key areas of development are needed to affect change in the finance and insurance industries:
- New risk evaluation. Out of these new partnerships need to come new approaches to assessing risk to take account of both the immediate risks, in terms of increasing energy demand and fuel price volatility, and the long-term massive portfolio risk under business-as-usual approaches that result in catastrophic climate change.
- New partnerships. New partnerships – both formal and informal – between finance experts and entrepreneurs, technologists, and scientists in order to update the understanding of low-carbon technologies and the risks associated with these technologies as well as conventional high-carbon technologies. The entrepreneurs, technologists, and scientists have critical information and insights regarding this new market that has not yet penetrated the financial world.
- Demonstrations projects. Deployment examples for new and emerging technologies are critical to attract institutional investors. Many will require government support.
There is also an important regulatory role for government to play. As the economics of low-carbon technologies are proven across sectors, low-carbon technology standards should be introduced in order to accelerate scale up. These technology standards mandate emissions below a certain level, based on available cost-effective technologies.