Exxon and Shell conclude that society get serious about climate adaptation. Mitigation just is not working. These two corporations—two of the largest economic entities in the world with access to the best science and analysts that money can by—now admit that Earth will warm at least 2 degrees.
The admission comes in response to inquiries from investors worried that preventing climate change requires reducing green house gas emission and thus leaving huge amounts of carbon in the ground. These “stranded assets” could reduce fossil fuel industry profits and hurt shareholders.
The logic behind this conclusion is simple and transparent:
- Population is increasing, wealth is increasing, and consumption is increasing—so demand for energy is increasing.
- Even remarkable rates of growth in non-fossil fuel energy sources will be insufficient to meet this increased demand.
- Governments are evidencing little political will to regulate green house gas emissions.
Shareholders in fossil fuel companies should continue to enjoy stock dividends into the foreseeable future. But we should all worry about the economic catastrophe that might result from a 4 degree warmer world.
(For more details see “The elephant in the atmosphere,” The Economist, July 19 2014)