However, new research suggests that the momentum behind technological change in the global power and transportation sectors will lead to a dramatic decline in demand for fossil fuels in the near future.
The study indicates that this will now happen regardless of apparent market certainty or the adoption of climate policies - or lack thereof - by major nations.
Detailed simulations produced by an international team of economists and policy experts show this fall in demand has the potential to leave vast reserves of fossil fuels as "stranded assets": abruptly shifting from high to low value sometime before 2035.
Such a sharp slump in fossil fuel price could cause a huge "carbon bubble" built on long-term investments to burst. According to the study, the equivalent of between one and four trillion US dollars could be wiped off the global economy in fossil fuel assets alone. A loss of US$0.25 trillion triggered the crash of 2008 by comparison.
Publishing their findings Monday in the journal Nature Climate Change, researchers from Cambridge University (UK), Radboud University (NL), the Open University (UK), Macau University, and Cambridge Econometrics, argue that there will be clear economic winners and losers as a consequence.
Japan, China, and many EU nations currently rely on high-cost fossil fuel imports to meet energy needs. They could see national expenditure fall and - with the right investment in low-carbon technologies - a boost to Gross Domestic Product (GDP) as well as increased employment in sustainable industries.
However, major carbon exporters with relatively high production costs, such as Canada, the United States, and Russia, would see domestic fossil fuel industries collapse. Researchers warn that losses will only be exacerbated if incumbent governments continue to neglect renewable energy in favor of carbon-intensive economies.
Read more at 'Carbon Bubble' Coming that Could Wipe Trillions from the Global Economy -- Study
No comments:
Post a Comment