April 18, 2017 (Investorideas.com Newswire) Commercial activity in fossil fuels is increasingly at odds with global actions to reduce the threat of climate change. Burning coal, oil, and natural gas is responsible for two-thirds of humanity's emissions of greenhouse gases, and yet provides more than 20% of GDP in two dozen nation states. By Citicorp's estimate, current commitments to reduce these emissions could mean forgoing $100 trillion in fossil fuel revenues by 2050—representing a huge disruption to global affairs, undermining national budgets and corporate balance sheets while exposing stakeholders, including pension holders and ordinary citizens in resource-exporting states, to myriad risks.
Two seminal articles by energy experts in the latest issue of MRS Energy and Sustainability (MRS E&S) examine the climate-related risks facing the fossil fuel industry and conclude that the sustainability train has already well and truly left the station – and is not coming back.
An in-depth analysis by Jim Krane (Wallace S. Wilson Fellow for Energy Studies at Rice University in Houston) is very timely in the light of last month's announcement from Exxon Mobil that it will invest $20 billion through 2022 to expand its chemical and oil refining plants on the US Gulf Coast.
The former Associated Press Gulf correspondent finds, however, that climate changes risks vary according to different sectors of the energy industry. Demand for oil seems to be insulated from the very immediate risks facing other sectors of the industry, due to its unique role in transportation and the lack of viable alternatives, he writes. Citing a study by McGlade and Ekins, he concludes that oil reserves are the least exposed of the three fuels. Just a third of current conventional crude oil reserves would probably be abandoned to meet current global climate change targets, as opposed to half of gas and 82% of coal reserves.
For coal, the threats posed by climate action are already being felt. Coal firms have lost a combined 31,000 jobs and $30 billion in share value since 2010 in the US alone, according to Krane. Coal's fortunes now rest with developing countries, where decisions to seek China-style, coal-led development will be met by increasing international pressure to choose an alternate path, Krane writes.
At the other end of the spectrum, climate action seems to have improved the medium-term viability of low-carbon natural gas, given the fuel's reduced carbon content, according to Krane. Many anticarbon policies that target coal cede market share to gas, he writes. Longer term, however, gas is vulnerable to replacement by lower-carbon substitutes.
Krane predicts that some businesses, and perhaps even some governments, may not survive the increasing pressures facing the energy industry as a result of climate change actions.
"Unless a technological breakthrough can restrict carbon releases, the fortunes of the fossil fuel industry and the stability of Earth's climate will be locked in a zero-sum game," he concludes. "Climate's gain is the industry's loss and vice versa."
"It is clear that carbon-based businesses and economies face increasing impediments to the consumption of their products," he writes. "Whether through taxes, legal restrictions, moral arguments, favoritism for competitors, or hampered access to financial markets, the industry faces a future that is less accepting of current practice."
In his commentary on Krane's article in the same volume of MRS E&S , Ritchie D. Priddy, a seasoned energy industry veteran who has published more than 200 papers on clean energy and sustainability issues, agrees with the majority of Krane's thesis. He argues that what he calls the "sustainability movement" has already had a substantial impact on the practices of energy companies and governments and will continue to grow, in spite of the outcry over some countries backpedaling from the Paris Accord. The sustainability train has already left the station, he writes, and although the pace may slow, sustainability actions will continue around the world regardless of which governments are in place in the US and elsewhere. The main driver for action is peer pressure, he adds, rather than any government action.
"As [sustainability efforts] become more ingrained in the daily operations of all companies—primarily through peer pressure—they will, collectively, become more powerful than any international treaty, and something that cannot easily be removed," Priddy concludes.
MRS E&S, a journal of the Materials Research Society and Cambridge University Press, encourages contributions that provide viewpoints and perspectives on the all-important issue of how humankind can work towards, and build, a sustainable future.
The contents of this press release refer to the following articles which are freely available online:
Climate change and fossil fuel: An examination of risks for the energy industry and producer states by Jim Krane
Sustainability: The train has left the station
by Ritchie D. Priddy
For more information, please contact Jo Skelton at firstname.lastname@example.org or at +44-1223-32-6165.
About MRS Energy & Sustainability
MRS Energy & Sustainability publishes reviews on key topics in materials research and development as they relate to energy and sustainability. Topics to be reviewed are new R&D of both established and new areas; interdisciplinary systems integration; and objective application of economic, sociological, and governmental models, enabling research and technological developments. The reviews are set in an integrated context of scientific, technological and sociological complexities relating to environment and sustainability.
The intended readership is a broad spectrum of scientists, academics, policy makers and industry professionals, all interested in the interdisciplinary nature of the science, technology and policy aspects of energy and sustainability. It is published by the Materials Research Society and Cambridge University Press.
David S. Ginley, National Renewable Energy Laboratory, USA
David Cahen, Weizmann Institute of Science, Israel
Elizabeth A. Kócs, University of Illinois at Chicago, USA
For further information, go to https://www.cambridge.org/core/journals/mrs-energy-and-sustainability
About the Materials Research Society
The Materials Research Society (MRS) is an international organization of almost 14,000 materials researchers from academia, industry and government, and a recognized leader in promoting the advancement of interdisciplinary materials research to improve the quality of life. MRS members are engaged and enthusiastic professionals hailing from physics, chemistry, biology, mathematics and engineering–the full spectrum of materials research. Headquartered in Warrendale, Pennsylvania (USA), MRS membership now spans over 90 countries, with approximately 48% of members residing outside the United States. In addition to its communications and publications portfolio, MRS organizes high-quality scientific meetings, attracting over 13,000 attendees annually and facilitating interactions among a wide range of experts from the cutting edge of the global materials community. MRS is also a recognized leader in education outreach and advocacy for scientific research.
For further information, go to: www.mrs.org
About Cambridge University PressCambridge University Press is the publishing business of the University of Cambridge. Dedicated to excellence, its purpose is to further the University's objective of advancing knowledge, education, learning, and research. Its extensive peer-reviewed publishing lists comprise 45,000 titles covering academic research, professional development, more than 380 research journals, school-level education, English language teaching and bible publishing. Playing a leading role in today's international market place, Cambridge University Press has more than 50 offices around the globe, and it distributes its products to nearly every country in the world.
For more information, go to www.cambridge.org
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