Two new major campaigns have emerged in recent weeks in the never-ending battle against human-caused climate change.
The first is an organized movement to encourage divestment of shares in fossil fuel companies. This had some success in the campaign against South Africa’s apartheid regime, although other factors (like the dramatic drop in gold prices) had quite a bit to do with it as well. Similar campaigns have not worked well against Israel or tobacco companies. The second ‘campaign’ is a more general exhortation to unite in forcing the world to leave fossil fuels in the ground unburned.
As I recently wrote, I have no problem with people or institutions reconfiguring their portfolio to move away from business sectors that trouble them. However, some of their additional justifications for doing so don’t really make sense.
They warn that fossil fuel reserves may become stranded assets as political bans against fossil fuels may at some point make the reserves inaccessible. Although there are no such bans at present, nor are any under consideration, I suppose that is possible.
However, India, China, Indonesia, Brazil and Mexico are not likely to sign on to such initiatives. Indeed, the use of fossil fuels is projected to double by 2040. Instead of assets being stranded, it seems clear they will be sweated.
For every shareholder looking to clear their conscience by selling their shares in Exxon, there will be a willing buyer who looks to the increased demand as an opportunity.
As for the idea of leaving fossil fuels in the ground, some are pushing this as a replacement meme following unsuccessful attempts to generate concern about concentrations of CO2 in the atmosphere. It is a simpler, cruder campaign–Fossil fuels are bad. We must quit using them. There are X amount of tonnes of fossil fuels that we can use without exceeding our Carbon Budget–all the rest must lie untouched.
I don’t know why these campaigners would move away from science and towards bombast and politics. The Carbon Budget is an accounting fiction, much in the way 350 ppm and 2C were accounting fictions. It may just be a way of gathering fracked natural gas into the fold of condemned substances–I don’t know.
But the science behind the focus on CO2 concentrations is clearer and better understood. The Keeling Curve is the most trusted metric in the climate change debate. Sidelining it in favor of a mythical Carbon Budget is acknowledging only that you cannot make headway using science.
It’s a bad move.
I also don’t understand why climate activists want to let private companies off the hook regarding climate change. The owners of the big reserves of fossil fuels are predominantly national governments–70%, according to Forbes magazine. I wonder which government will be the first to abandon the billions they get from fossil fuels. Nigeria? Saudi Arabia? Kuwait? Russia? The U.S.?
Bear in mind that those countries that do not abandon fossil fuels will become even richer if some do. I don’t think incentives line up for success of this initiative.
Back to the drawing board, folks.