Some place in England called Oxford University today begins a four-year study to identify assets that could be left "stranded" by climate change. That's stranded as in suddenly worthless - or worse.
Guess what? Bitumen is probably top of the list. Here's the photo The Guardian ran with the story. Yeah, that's right, it's one of Syncrude's operations in Athabasca.
Backed by HSBC, Aviva, WWF-UK and Climate Change Capital, the four-year University of Oxford research programme is attempting to flag up high-carbon sectors and assets that could be dramatically devalued or written off by the continuing shift towards a greener economy.
Initially it will focus on transportation and production methods in the agricultural supply chain, while later studies, set to be commissioned as the programme develops, are likely to include transport, power generation, real estate and a range of commodities.
The researchers aim to create tools to manage the risk of asset stranding, as well as analyse investor portfolios, better understand risk exposure and inform investment decision making for businesses and policy makers.
Asset stranding traditionally results from changes in technology and regulation that reduce demand for established products or services. But, according to a growing group of campaigners concerned about the development of a so-called "carbon bubble", the relatively rapid pace of new developments in clean energy and low-carbon technology have put environmentally unsustainable assets, such as fossil fuel resources, at a greater risk than previously thought. (Which has obvious implications when you're peddling seriously high-carbon that's also seriously high-cost to extract, process and transport)
A report published earlier this year by HSBC found current internationally agreed carbon targets could see oil and gas majors, including BP, Shell and Statoil, lose up to 60 per cent of their market value.
...In a speech to mark the launch of the new research programme later today, Lord Deben, chairman of the Committee on Climate Change, will urge businesses and governments to take steps to adapt to the new economic realities presented by the emergence of low-carbon technologies and increasingly ambitious climate change policies.
"Investors continue to deploy hundreds of billions of pounds into polluting and unsustainable sectors," he is expected to say. "In many cases these investments will not be worth what investors think. If investors better understand the risks of investing in these assets they will be attracted to greener alternatives and see them as better business propositions and safer places for their funds."
It seems like just yesterday - why, it was just yesterday (and for years before that) that I wrote of the danger to which the Canadian economy was being exposed by our foolish "all or nothing" high-stakes gamble on sub-prime bitumen. Now Oxford is going to carry that ball.
And it seems like just yesterday that I heard the great Liberal leader Ignatieff proclaim Athabasca the "beating heart of the Canadian economy for the 21st century." Dolt.
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